Virtual Private Network (VPN) Market Size By Component (Hardware, Software, Services), By Type (IP, MPLS(Multiprotocol Label Switching), Cloud VPN, Mobile VPN), By Connectivity (Site-to-site, Remote Access, Extranet), By Application (Consumer [Smartphones, Tablets, Laptops/PCs], Commercial [BFSI, Healthcare, IT, Government, Manufacturing], Service Providers) Industry Analysis Report, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2018 – 2024

Published Date: Nov 2018  |  Report ID: GMI2756  |  Authors: Ankita Bhutani, Preeti Wadhwani

Report Format: PDF   |   Pages: 300   |   Base Year: 2017

Summary Table of Contents Industry Coverage Methodology

Industry Trends

VPN Market size was estimated to be over USD 17 Billion in 2017 and is anticipated to grow at a CAGR of more than 15% over the forecast timespan.

VPN Market

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The increasing adoption of VPN solutions across various industry verticals is fostering the VPN market growth. The businesses are leveraging on VPN to boost their security and access sensitive information from remote locations. It encrypts any data, which is transferred over the public internet connection to secure company resources. It also saves unnecessary expenses by eliminating the need for leased lines and call trafficking equipment for business establishments.   

The emergence of trends such as BYOD is also driving the growth of the VPN market. Allowing employees to connect their own devices to the company network leads to a significant increase in security concerns and vulnerabilities. This makes organizations more vulnerable to data thefts and provides unauthorized access to sensitive information. To address these challenges, organizations are looking for more advanced solutions to secure their data. VPN allows organizations to encrypt their data on the employee’s device. It also scans devices for malware or trojans to shield the company’s sensitive data from any unauthorized access.

Virtual Private Network (VPN) Market Report Coverage
Report Coverage Details
Base Year: 2017 Market Size in 2017: 17 Billion (USD)
Historical Data for: 2013 to 2017 Forecast Period: 2018 to 2024
Forecast Period 2018 to 2024 CAGR: 15% 2024 Value Projection: 54 Billion (USD)
Pages: 300 Tables, Charts & Figures: 374
Geographies covered (18): U.S., Canada, UK, Germany, France, Italy, Spain, Netherlands, Australia & New Zealand, China, India, Japan, South Korea, Brazil, Mexico, UAE, Saudi Arabia, South Africa
Segments covered: Component, Type, Cloud VPN, Mobile VPN, Connectivity, Application and Region
Companies covered (30): Airvpn Di Paolo Brini, Anchorfree Gmbh, Anthasoft, S.A. De C.V., Array Networks, Inc., Avast Software s.r.o, Blackberry Limited., Bufferd Inc., Checkpoint, Cisco Systems, Inc., Citrix Systems, Inc., Columbitech Ab, Cryptzone, Cyber Ghost, Express VPN, LLC, Golden Frog, GmbH, Google, Inc., IBM Corporation, Juniper Networks, Inc., Microsoft Corporation, Mudhook Marketing, Inc., NCP engineering GmbH, NetMotion Software, Inc., Nord VPN, OPENVPN, Inc., Opera Software, Safer Social Ltd., Smith Micro Software, Inc., TunnelBear, Inc., WatchGuard Technologies, Inc., Windscribe Limited
Growth Drivers:
  • Rising in cybercrimes and data breached activities
  • Proliferation of internet services
  • Increasing adoption of VPN services across various business verticals
  • Compliance regulations requiring organizations to implement additional security
  • Adoption of trends such as BYODs
Pitfalls & Challenges:
  • Budget constraints
  • Need to support multiple OS slows down VPN functionalities
  • Reluctance to adopt various VPN solutions

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VPN Market, By Component

The hardware is estimated to account for 45% of the revenue in the VPN Market. The growth of the market is credited to a high demand for VPN routers among organizations and service providers. VPN routers secure multiple devices and ensure security against DNS or WebRTC leaks. They provide an integrated firewall, which acts as a kill switch along with split tunnel capabilities, restricting the users from accessing certain websites. In addition, it enhances transfer speeds and facilitates simultaneous processing of multiple activities.

The software market is estimated to grow at a CAGR of over 18% over the projected time period. The market is driven by the increasing adoption of digital mobility across industry verticals. It provides employees a secure & seamless access to corporate networks and resources while traveling or working remotely. The software employs advanced security algorithms such as multifactor authentication and endpoint systems compliance to ensure the integrity & privacy of sensitive information.

VPN Market, By Type

Multiprotocol Label Switching (MPLS) holds more than 40% of the total stake in the VPN Market in 2017. The declining ATM/Frame-relay market is expected to foster the MPLS market growth. The businesses are leveraging on MPLS VPN services as they help them prioritize applications such as Voice over Internet protocol (VoIP) by class for service. In addition, it also eliminates the need for specific VPN tunneling, reducing the latency of inter-site transfer.  

Europe VPN Market By Type

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The mobile VPN market is predicted to grow at a CAGR of 17% over the projected time frame. This growth can be credited to a surge in cybercrime activities across multiple business verticals. With an increase in the number of companies using cloud services and mobile devices for work purposes, data security has become a primary area of focus for various organizations. Hence, due to the rising incidence of cyber-attacks, the organizations are adopting VPN services to protect their resources. 

VPN Market, By Connectivity

The site-to-site market is leading the connectivity landscape with more than 40% share in the VPN market. The cost-effectiveness of the site-to-site connectivity is encouraging its deployment among corporates and services providers. It eliminates the requirement for separate VPNs on each system and provides a cost-effective solution to avoid any security concerns. It also enables the secure transmission of data via tunnels to encapsulate the data packet into the normal VPN to forward over an IP-based network.

The extranet market is estimated to account for over 15% of the revenue in the VPN market. The businesses across various business sectors are implementing the extranet topology to remain competitive in the market by staying in touch with customers. Hence, the companies are focusing on strengthening their extranet capabilities to offer updated information to their external stakeholders.

VPN Market, By Application

The commercial application market accounts for approximately 44% share in the VPN market. The market growth is attributed to the widespread adoption of VPN solutions by the BFSI sector. Banks and financial establishments are using VPN services to deploy security measures to protect their customer credentials across online banking portals. The integration of the advanced technology solution and the digitalization of banking and insurance services are encouraging the adoption of VPN solutions. Moreover, the advent of Fintech and mobile payments and wallets solutions is also augmenting the demand for more secure network connection in the BFSI sector to serve customers securely.

Japan VPN Market By Commercial Application

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The consumer market is predicted to grow at a CAGR of 20% over the forecast time frame. The rapid internet proliferation and the growing adoption of smartphones and tablets are the primary factors driving the adoption of the VPN among consumers. The consumers are using VPN services to access restricted content and protect their devices from authorized access. There has been an increase in public Wi-Fi usage since the decrease of cellular plan data usage. The VPN helps in guarding the privacy of users, who access the internet through public networks.

VPN Market, By Region

North America dominates the VPN Market with a 35% share in 2017. The increasing number of cyber-attacks on organizations across various business sectors fosters the market growth. A rapid surge in the number of cyber-attacks has been witnessed in the region. Approximately 31% of the organizations have experienced cyber-attacks on operational technology infrastructure in 2017. This is encouraging organizations to adopt secure and advanced solutions to protect their data. Moreover, the high internet penetration and wide adoption of the smartphones in the region are also promoting the use of VPN solutions.

The Asia Pacific VPN Market is projected to attain a growth rate of over 20% during the forecast timeline. The market is driven by the increasing penetration of smartphones and other internet-enabled devices in the region. Furthermore, the digitalization activities in the region and the rapid adoption of the cloud and digital mobility solution among SMBs also augment the demand for the VPN solutions.

Competitive Market Share

The VPN market is dominated by large players such as Google, Microsoft, and Cisco. VPN providers are providing their customers with discounts and special offers to expand their customer base. The players in the market are forming partnerships with various regional companies to penetrate foreign markets. For instance, in 2018, Mozilla announced its partnerships with ProtonVPN to offer VPN services to security-conscious Firefox users. This partnership will strengthen its product portfolio and generate additional revenue sources to increase its profitability.

The major players in the VPN Market are Airvpn Di Paolo Brini, Anchorfree Gmbh, Anthasoft, S.A. De C.V., Array Networks, Inc., Avast Software s.r.o, Blackberry Limited., Bufferd, Inc., Checkpoint Software Technologies, Cisco Systems, Inc., Citrix Systems, Inc., Columbitech Ab, Cryptzone, Cyber Ghost, Express VPN, LLC, Golden Frog, GmbH, Google, Inc., IBM Corporation, Juniper Networks, Inc., Microsoft Corporation, Mudhook Marketing, Inc., NCP engineering GmbH, NetMotion Software, Inc., OPENVPN, Inc., Opera Software, Safer Social Ltd., Smith Micro Software, Inc., TunnelBear, Inc., WatchGuard Technologies, Inc. and Windscribe Limited.  

Industry Background

VPN is a technology that provides a safe and encrypted connection over public networks such as the internet. The VPN connection is established between multiple parties through a VPN gateway to preserve the integrity of the data. It allows remote access to the company’s resources such as file servers, computers, databases, emails, and webpages. It is used to mask the physical location of the users accessing any website. It allows the users to bypass restrictive censorship and access content that would otherwise be blocked.

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