Hardware Security Module Market - CAGR of 13.9% (2022-2030)

The hardware security module market size is expected to grow from US$ 1.36 billion in 2022 to US$ 3.85 billion by 2030; it is estimated to record a CAGR of 13.9% from 2022 to 2030.

Analyst Perspective:

The market has grown in response to enhanced data protection as a result of rising cyber-attacks. As data is sensitive and confidential, many big businesses and corporations are mostly targeted by hackers. Thus, hardware security module (HSM) solutions are frequently used by businesses to safeguard their applications. The growth in data breaches and cyberattacks propels the hardware security module market growth globally. Moreover, the growing adoption of cloud-based services is expected to create an opportunity for the market. The HSMs offer physical access protection, generation of keys, secure management of key material, and a secure execution environment for cloud applications. Furthermore, technical advancements in the development of sophisticated HSM services are expected to bring new hardware security module market trends in the coming years.

Hardware Security Module Market Overview:

A hardware security module (HSM) is a dedicated crypto processor that is specifically built for crypto key lifecycle protection. Hardware security modules securely manage, process, and store cryptographic keys inside a hardened, tamper-resistant device, acting as trust anchors to safeguard the cryptographic infrastructure of the most security-conscious enterprises across the world. It helps to reduce risk and satisfy compliance requirements using PKI, blockchain, code signing, document signing, database encryption, eIDAS, GDPR, DNSSEC, PCI DSS, and other solutions. Also, it helps to safeguard cryptographic keys wherever the companies' applications and workloads operate at scale and with flexibility. Furthermore, it also protects digital transition with equipment built for modern data centers.

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Hardware Security Module Market: Strategic Insights

Market Size Value in	US$ 1.36 billion in 2022
Market Size Value by	US$ 3.85 billion by 2030
Growth rate	CAGR of 13.9% from 2022 to 2030
Forecast Period	2022-2030
Base Year	2022

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Market Driver:

Rising Cases of Data Breach Drive Hardware Security Module Market Growth

The rise in digitalization has encouraged several businesses across various industry verticals to digitalize their business in order to gain competitive advantage, enhance operational workflow, and reach more targeted audiences. However, the adoption of digital solutions makes critical data vulnerable and accessible to potential data breach incidents, leading to a rise in the number of data breach cases and incidents. A data breach is a security incident where an unauthorized party gains access to any business-sensitive and crucial information. Data breach incidents can impact business performance due to loss of critical information, financial losses, loss of trust of customers, and others. A few of the data breach incidents and related information are mentioned below:

• In June 2023, a major data breach case took place as a Telegram bot uploaded the data of millions who registered on the COWIN app. The data leak included mobile numbers, Aadhar card IDs, passports, and other critical customer information.
• In July 2023, IBM Security released the Cost of a Data Breach report for 2023. The report indicated that the global average data breach cost reached US$ 4.45 million in 2023, a 15% increase over the previous three years.
• As of July 2023, the file transfer tool MOVEit experienced a massive data hack impacting 200 organizations and 17.5 million individuals. The data of multiple critical organizations and government bodies, such as the Department of Agriculture, Energy, and Department of Health and Human Services, got leaked.
• In May 2023, Deutsche Telekom AG's brand T-Mobile experienced its second data breach case for 2023, where over 800 customer's PINs, full names, and phone numbers got leaked.

Thus, the rise in the number of data breach cases generates the demand for enhanced levels of security solutions, such as hardware security modules, as it can help businesses boost their network security, playing an important role in determining the hardware security module market forecast .

Hardware Security Module Market Analysis: Segmental

Based on type, the market is divided into LAN based, PCIe based, and USB based. The LAN based segment held the largest hardware security module market share in 2022, whereas the PCIe based segment is anticipated to register the highest CAGR during 2022–2030. The demand for LAN based hardware security modules is increasing due to the rising need for faster data transfer and communication. Furthermore, the demand for PCIe hardware security modules in various companies to protect the integrity and security of encryption keys is predicted to propel during the forecast period. These HSMs are specifically designed to increase the performance and security of sensitive workloads while also providing fast throughput for cryptography activities.

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Regional Analysis:

Europe held the largest hardware security module market share in 2022. The Europe market is expected to grow during the anticipated period due to the growing awareness regarding the data security benefits provided by HSMs. The growing BFSI, IT & telecommunication, healthcare, and other industries in the region are raising the need for hardware security modules to protect their business information. Furthermore, the increasing digital advancements in countries such as Germany, the UK, and other European countries and the growing adoption of cloud-based technologies are creating an opportunity for the hardware security module market in Europe.

Key Player Analysis:

Thales, STMicroelectronics, Utimaco Management GmbH, Atos SE, IBM Corporation, Futurex, SWIFT, Ultra Electronics Holdings plc, Infineon Technologies AG, and Hewlett Packard Enterprise Development LP are the key players profiled in the hardware security module market report. This hardware security module market report provides detailed market insights, which help the key players strategize their growth.

Recent Developments: 

The hardware security module market players highly adopt inorganic and organic strategies. A few recent key market developments are listed below:

• In June 2023, Thales Trusted Cyber Technologies (TCT) announced the launch of the new version 7.13.0 of the Luna Network and PCIe HSMs. It includes different features such as remote initialization of the Remote PED Vector Key, enabling fully remote HSM administration, support for LACP 802.3ad protocol to enhance multi-NIC port bonding in the Network HSM appliance, and Luna Client support for Windows Server 2022 and Ubuntu 22 LTS.