Global Next Generation Firewall (NGFW) Market Outlook to 2030

Global Next Generation Firewall (NGFW) Market Overview

• The Global Next Generation Firewall (NGFW) Market was valued at USD 10 Bn in 2023, driven by the growing demand for advanced security solutions due to increasing cyber threats and data breaches. The rapid adoption of cloud-based services and the proliferation of connected devices have also necessitated robust security measures, thus fueling the demand for NGFWs.
• Major players in the NGFW market include Palo Alto Networks, Fortinet, Cisco Systems, Check Point Software Technologies, and Juniper Networks. These companies have a significant market share due to their strong product portfolios and extensive customer base. Palo Alto Networks, in particular, dominates with its innovative features and extensive global presence.
• Check Point introduced several new products in 2023, including enhancements to its Quantum SD-WAN and the Horizon XDR platform. These innovations aim to provide comprehensive security solutions that integrate connectivity and threat prevention across various environments, reinforcing Check Point's commitment to cybersecurity excellence.
• Major cities like San Francisco, New York, and London dominate the NGFW market due to their concentration of large enterprises and tech startups, which are primary consumers of advanced cybersecurity solutions. San Francisco, being a hub for technology companies, has a high demand for NGFWs to protect against sophisticated cyber threats.

Global Next Generation Firewall (NGFW) Market Segmentation

The Global Next Generation Firewall (NGFW) Market can be segmented based on several factors:

By Deployment Type: The market is segmented by deployment type into On-Premise, Cloud-based & Hybrid. In 2023, On-Premise accounts for the largest value share. This dominance is attributed to the preference of large enterprises and government organizations for maintaining control over their security infrastructure. On-premises NGFWs are favored due to their ability to provide high levels of customization and integration with existing network systems.

By Industry Vertical: The market is segmented by industry verticals into BFSI, Healthcare, IT & Telecom, Retail & Government. In 2023, BFSI dominates the market due to the industry's stringent regulatory requirements and the critical need for protecting sensitive financial data from cyber-attacks. The BFSI sector's ongoing digital transformation and increasing adoption of cloud services further necessitate advanced NGFW solutions to safeguard against potential security breaches.

By Region: The market is segmented by region into North America, Europe, Asia-Pacific, LAMEA and Middle East & Africa (MEA). In 2023, North America dominates the Global Next Generation Firewall (NGFW) market due to the presence of key NGFW vendors, a high level of cybersecurity awareness, and significant investments in network security infrastructure. The increasing frequency of cyberattacks on critical infrastructure and enterprises has led to heightened demand for NGFWs in the USA, making it the largest market globally.

Global Next Generation Firewall (NGFW) Market Competitive Landscape

• Palo Alto Network: In 2024, Palo Alto Networks introduced new security solutions powered by Precision AI. The company is emphasizing the importance of integrated capabilities to streamline security operations and improve efficiency in response to the growing volume of cyber threats, which includes an average of 2.3 million new threats daily.
• Cisco & Tech Mahindra Partnership: In 2024, Tech Mahindra has expanded its collaboration with Cisco to deliver an AI-powered NGFW modernization solution for their global customers. This initiative enhances traditional firewall capabilities by integrating advanced features such as unified policy management across both on-premises and cloud environments, as well as incorporating Cisco's Talos threat intelligence for comprehensive malware defense.

Global Next Generation Firewall (NGFW) Industry Analysis

Growth Drivers:

• Rising Cybersecurity Threats: The increasing frequency and sophistication of cyber-attacks globally are driving the demand for Next Generation Firewalls (NGFW). In 2023, Internet Crime Complaint Centre received 880,418 complaints with potential losses exceeding $12.5 billion. This surge has led organizations to invest heavily in advanced NGFW solutions to protect sensitive data and ensure compliance with regulatory frameworks.
• Expansion of Cloud-Based Services: Organisations are migrating to cloud environments require advanced firewalls that can offer real-time protection and scalability. AWS alone offers over 200 distinct cloud services, while Azure and GCP provide similar offerings across various models like Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS), and Software-as-a-Service (SaaS). NGFWs are particularly critical in hybrid cloud environments where traditional firewalls fall short.
• Regulatory Compliance Requirements: Governments worldwide are imposing stringent regulations to protect data and ensure cybersecurity resilience. The European Unions General Data Protection Regulation (GDPR) has imposed heavy fines for data breaches, incentivizing organizations to adopt robust security measures like NGFWs. In 2023 fines related to GDPR violations amounted to 1.2 billion on Meta, pushing them to enhance their security infrastructures.

Challenges:

• Complexity in Integration: Integrating NGFWs into existing IT infrastructure can be a complex process, particularly for organizations with legacy systems. This complexity often necessitates additional investments in IT staff training and system upgrades, further complicating the adoption process and delaying the realization of security benefits.
• Evolving Cyber Threat Landscape: The constantly evolving nature of cyber threats poses a significant challenge to the effectiveness of NGFWs. This rapid evolution of threats requires continuous updates and enhancements to NGFW technologies, putting pressure on vendors to innovate at a fast pace. Failure to keep up with these advancements can render NGFWs ineffective, leading to potential breaches and loss of customer trust.

Government Initiatives:

• European Union Cybersecurity Resilience Act: The European Union introduced the Cybersecurity Resilience Act in 2024, aimed at strengthening the cybersecurity posture of critical infrastructure operators across member states. Security incidents and vulnerabilities must be reported to ENISA, the EU's cybersecurity agency, within 21-36 months. This legislative push is expected to significantly boost the NGFW market in Europe.
• Indias National Cybersecurity Strategy (2021-2024): India's National Cybersecurity Strategy aims to ensure a safe, secure, trusted, resilient, and vibrant cyberspace for the country. India witnessed a 218% increase in ransomware attacks in 2021, making it the 10th most targeted country globally and 2nd in the Asia-Pacific region after Australia. The strategy also includes provisions for training and capacity building to ensure the effective deployment and management of NGFWs, thereby supporting market growth.

Global Next Generation Firewall (NGFW) Future Market Outlook

The market is expected to reach USD 16 Bn by 2030 driven by the increasing demand for advanced cybersecurity solutions in the face of evolving cyber threats. The integration of machine learning and AI into NGFWs will enable organizations to proactively defend against sophisticated attacks, reducing response times and improving overall network security.

Future Market Trends

• AI and Machine Learning Integration: Over the next five years, the integration of AI and machine learning into NGFWs will become a standard feature, enabling firewalls to autonomously detect and respond to emerging threats. These technologies will allow NGFWs to adapt to new attack vectors in real-time, reducing the need for manual intervention and enhancing overall security effectiveness.
• Cloud-Native Security Solutions: As organizations continue to migrate to cloud environments, the demand for cloud-native NGFW solutions will increase. Future NGFWs will be designed to seamlessly integrate with cloud platforms, offering unified security management across hybrid and multi-cloud deployments. This trend will be driven by the need for scalable security solutions that can protect dynamic cloud workloads.