Hardware Security Modules Market Size, Share, Opportunities, And Trends By Type (LAN based, PCle based, USB based), By End User Industry (BFSI, Retail, Communication and Technology, Automotive, Others), And By Geography - Forecasts From 2023 To 2028

The global hardware security module (HSM) market is expected to grow at a CAGR of 11.33% to reach a value of US$2.658 billion by 2028, from US$1.256 billion in 2021.

There is an increase in the adoption of communication, data encryption, and cybersecurity solutions across different industries, including BFSI, telecom, and automotive, among others, to achieve scalability, protect identities and transactions, reduce operational costs, and prevent data breaches. This has increased the demand for effective encryption solutions owing to which the demand for hardware security modules is increasing across these industries.

However, there is an availability of a substitute for hardware security modules in the market, hindering market growth. The key management software is designed to manage cryptographic keys in a cryptosystem and deals with keys' generation, exchange, storage, use, destruction, and replacement. This is the same function the hardware security module (HSM) performs, thus acting as a restraining factor in the growth of the hardware security module (HSM).

Market Drivers:

• Favorable investments in cryptocurrency and crypto wallets

The growing use of cryptocurrency and crypto-wallets such as "HSMWallet," which provide additional security of data, passwords, transactions, and key information, supported by increasing investments in the cryptocurrency platforms, provides a great opportunity for the hardware security market players to expand their market share, thereby leading to overall market growth during the next five years.

Some major players like Google and Amazon are offering their "Google Cloud HSM" and "AWS Cloud HSM" as-a-service solutions. Furthermore, other market players are launching new and enhanced products to boost their market share and contribute to market growth. For example, in May 2019, Atos, one of the leading companies in providing digital transformation services and solutions, announced the launch of its new product, "Hardware Security Module," to address the problems of the IoT industry. It is a high-performance security device that can protect the IoT industrial landscape via cryptographic features.

• Favorable government initiatives

Moreover, the government is contributing to market growth by taking initiatives and actions to boost the adoption of these hardware security modules to keep the users' data safe and secure. For example, in the wake of increasing cybersecurity threats, on May 25, 2018, the General Data Protection Regulations (GDPR), set by the EU, were made effective, under which EU residents were provided greater control over their data. These regulations applied to all the member states of the EU, and it was highlighted that all the organizations within the EU were required to comply with them, with the major objective of providing overall protection and encryption of sensitive data.

The global hardware security module market is segmented based on type, end-user industry, and geography. By type, the market is segmented as LAN-based, PCIe-based, and USB-based. The end-user industry segments the global hardware security module market as BFSI, retail, communication, technology, automotive, etc.

USB-based to hold a significant market share

The USB-based hardware security module is estimated to hold a significant share of the hardware security module market, which is attributable to it being an easier solution to integrate. The USB-based hardware security module can be directly attached to the computer and provides access to all the features. For example, Yubico provides its product "YubiHSM," which facilitates rapid integration due to the Open-source SDK (software development kit) and allows developers to support hardware-based activities for various applications. It can be easily integrated into the front USB slot of computers and servers and can provide security for Microsoft Active Directory certificates.

• BFSI industry to contribute significantly to the market growth over the forecast period.

The BFSI industry holds a significant market share throughout the forecast period. The increasing number of online transactions is leading to a rise in the volume of users' financial and personal sensitive data, encouraging the BFSI industry players to use hardware security modules to protect the customer's transactions and identities. The demand for hardware security modules across the global communication and technology sectors is also expanding owing to the growing volume of user data and the rising incidence of cybersecurity threats.

North America is one of the major regional markets for hardware security module vendors.

The global hardware security module market is geographically segmented into North America, South America, Europe, the Middle East, Africa, and the Asia Pacific. The North American regional market held a significant market share in 2019 owing to the early adoption of advanced technologies and the presence of major market players in the region. Increasing R&D investments for improving and enhancing this solution's capabilities, with players attempting to integrate it into every aspect of the end-user industries, is also contributing to market growth in this region.

Key Developments:

• February 2022: A strategic partnership between Securosys and Randtronics was formed to combine the former's CloudsHSM portfolio with the latter's data privacy manager (DPM). To manage their cryptographic keys securely throughout their enterprises, businesses can combine the Securosys hardware security module with the DPM from Randtronics.
• February 2020: Through a partnership with Fujitsu (Japan), Thales would offer its Cloud Hardware Security Modules (HSM) and Data Protection on Demand (PKI) that would support Fujitsu’s new PKI security and enterprise data encryption solutions.

Impact of COVID-19 on the Hardware Security Modules Market

The COVID-19 outbreak has substantially impacted the global hardware security module business. A global slowdown in new projects has resulted in a drop in demand for analog semiconductors. Workers stayed at home, making it difficult for multinational firms to integrate new hardware security modules, disrupting supply chains worldwide. Only the production and supply chain is stalled. Therefore COVID-19's effects on this market are only transitory. Production, supply chains, and demand for hardware security modules will all steadily rise as soon as the situation improves. Companies should consider more sophisticated hardware security modules to increase productivity during the COVID-19 lockdown.

Hardware Security Modules Market Scope:

 

Report Metric	Details
Market Size Value in 2021	US$1.256 billion
Market Size Value in 2028	US$2.658 billion
Growth Rate	CAGR of 11.33% from 2021 to 2028
Base Year	2021
Forecast Period	2023–2028
Forecast Unit (Value)	USD Billion
Segments Covered	Type, End-User Industry, and Geography
Regions Covered	North America, South America, Europe, Middle East and Africa, Asia Pacific
Companies Covered	Futurex, Thales Group, Yubico, Entrust Corporation, IBM, Amazon Web Services, Inc, Atos SE, Google, Utimaco
Customization Scope	Free report customization with purchase

 

Segmentation:

• By Type
  • LAN based
  • PCle based
  • USB based
• By End-User Industry
  • BFSI
  • Retail
  • Automotive
  • Communication and Technology
  • Others
• By Geography
  • North America
    • USA
    • Canada
    • Mexico
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • Germany
    • France
    • United Kingdom
    • Spain
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • Israel
    • UAE
    • Others
  • Asia Pacific
    • China
    • Japan
    • South Korea
    • India
    • Thailand
    • Taiwan
    • Indonesia
    • Others

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1. INTRODUCTION

1.1. Market Overview

1.2. Market Definition

1.3. Scope of the Study

1.4. Market Segmentation

1.5. Currency

1.6. Assumptions

1.7. Base, and Forecast Years Timeline

2. RESEARCH METHODOLOGY  

2.1. Research Data

2.2. Research Process

3. EXECUTIVE SUMMARY

3.1. Research Highlights

4. MARKET DYNAMICS

4.1. Market Drivers

4.2. Market Restraints

4.3. Market Opportunities

4.4. Porter’s Five Force Analysis

4.4.1. Bargaining Power of Suppliers

4.4.2. Bargaining Power of Buyers

4.4.3. Threat of New Entrants

4.4.4. Threat of Substitutes

4.4.5. Competitive Rivalry in the Industry

4.5. Industry Value Chain Analysis

5. HARDWARE SECURITY MODULES MARKET BY TYPE

5.1. Introduction

5.2. LAN Based

5.3. PCLe Based

5.4. USB Based

6. HARDWARE SECURITY MODULES MARKET BY END-USE INDUSTRY

6.1. Introduction

6.2. BFSI

6.3. Retail

6.4. Automotive

6.5. Communication & Technology

6.6. Others

7. HARDWARE SECURITY MODULES MARKET BY GEOGRAPHY

7.1. Introduction

7.2. North America

7.2.1. USA

7.2.2. Canada

7.2.3. Mexico

7.3. South America

7.3.1.  Brazil

7.3.2. Argentina

7.3.3. Others

7.4. Europe

7.4.1. Germany

7.4.2. France

7.4.3. United Kingdom

7.4.4. Spain

7.4.5. Others

7.5. Middle East and Africa

7.5.1. Saudi Arabia

7.5.2. Israel

7.5.3. UAE

7.5.4. Others

7.6. Asia Pacific

7.6.1. China

7.6.2. Japan

7.6.3. South Korea

7.6.4. India

7.6.5. Thailand

7.6.6. Taiwan

7.6.7. Indonesia

7.6.8. Others

8. COMPETITIVE ENVIRONMENT AND ANALYSIS

8.1. Major Players and Strategy Analysis

8.2. Market Share Analysis

8.3. Mergers, Acquisitions, Agreements, and Collaborations

9. COMPANY PROFILES

9.1. Futurex

9.2. Thales Group

9.3. Yubico

9.4. Entrust Corporation

9.5. IBM

9.6. Amazon Web Services, Inc

9.7. Atos SE

9.8. Google

9.9. Utimaco

Futurex

Thales Group

Yubicon

Entrust Corporation

IBM

Amazon Web Service Inc.

Atos SE

Google

Utimaco