Global Hardware OTP Token Authentication Market - Segmented by Type (Connected, Disconnected, Contactless), End-user Industry, and Region - Growth, Trends, and Forecast (2018 - 2023)
The hardware OTP token authentication market was valued at USD 226.3 million in 2017 and is estimated to reach to a market value of USD 349.1 million by 2023 at a CAGR of 7.5%, over the forecast period (2018 - 2023). The scope of the report includes insights on the solutions offered by major players including providers of connected, disconnected, contactless, and associated solutions. North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa regions are covered in the scope of this study. The study offers insights on various end user such as BFSI, government, enterprise security, healthcare, etc.
Hardware OTP Token Authentication as a Market in Current Time
Hardware OTP tokens are a product category within the two-factor authentication sector, primarily used for ensuring user authentication and access management applications. Primary authentication is followed by the secondary authentication using a hardware device. Since user login authentication without the possession of hardware devices is not allowed, hardware tokens are reliable in ensuring authenticated user login. Further, hardware OTP tokens are highly instrumental in preventing any chance of network infiltration. The portability factor associated with these hardware devices also eliminates the need for external software and hardware for identity management. The enhanced level of security provided by these tokens is a significant factor reinforcing their demand across the various end-user industries around the world.
Enterprises, BFSI, government, healthcare, and other segments (gaming, service providers, etc.) are few of the end-user industry segments that require or are required to have multi-factor authentication for granting access to information or usage of services. The mandatory regulations from many government bodies make it necessary for the use of OTP. The market has witnessed innovation in its offering as the product has evolved to debit/credit form factor card type OTP display, from the traditional key fob type available in the initial stages.
Increasing Investments from Banking and Finance Industry is a Key Driving Force for Hardware OTP Token Authentication Market
With the rising rate of cyber-attacks and a growing number of online transactions, cybersecurity spending is expected to exceed USD 1 trillion from 2017 to 2021, as per the report published by CSO by IDG Communications Inc. Hence, customers are not only demanding security of both their identity and funds, but also expect a convenient, secure, and easy-to-use service, as mere passwords are not enough to protect sensitive information. As a result, financial institutions have to balance consumer demands, while meeting their security and compliance requirements. Authentication methods that are hardware-based take the form of a small device that provides a one-time-password (OTP) to an employee, to access enterprise or cloud services. The need for employee authentication is increasing at a significant rate due to the emergence of the ‘bring your own device’ (BYOD) phenomenon. As per the survey conducted by Gemalto, the number of organizations deploying hardware two-factor authentication has increased significantly in recent times.
Contactless Cards are expected to Register Highest Growth during the Forecast Period
Contactless tokens, unlike their counterpart connected tokens, form a logical connection to the client computer without requiring a physical connection. Thus, the absence of the need for physical contact helps make them more convenient than both connected and disconnected tokens. As a result, contactless tokens are a popular choice for keyless entry systems and electronic payment solutions, which use RFID to transmit authentication info from a keychain token.The market is expected to experience increased demand from enterprises, government offices, and healthcare, as ID cards for entry and exit inside the premises are mandatory and essential in most of the end-user industry.
Enterprise Security Continues to Grab Lion Share of the Hardware OTP Token Authentication Market though Growth is Slower
In an enterprise, it is necessary to maintain the integrity of the identity and access management systems, safeguard critical applications and other resources, by assuring that the people seeking access to these records are genuine (identity management) and authorized (access management). According to a 2017 report by VERIZON, 81% of hacking-related breaches were leveraged by either stolen and/or weak passwords. Hardware OTP token makes it difficult by using MFA, which is comparatively, a more secure option.
In the present time, the enterprises are aware of data theft and the resulting loss from it. Identity theft was one of the leading types of the data breach, accounting for 77% of all incidents, in 2017. The second most prevalent form of the violation was access to government data with 28%. The number of malicious outsiders increased the most for nuisance type of data breaches (488%), which constituted 98% of all compromised data.
Asia-Pacific is Growing at The Fastest Rate Among all the Regions
Asia-Pacific is experiencing development in the internet connectivity, and the governments in this region are trying to push for digital governance, offer services digitally to make investment and process less cumbersome. With the digital push, there has been an increased threat of data security being compromised. Financial transactions, enterprises, government, and education sectors are expected to see increased demand for the MFA in the region creating new opportunities for the hardware OTP token market.
According to the Breach Level Index Report 2017, the Asia-Pacific region experienced 113 data breaches in 2017, accounting for 7% of the total and down 24% from 2016. Australia experienced 40, India 29 and China five data breaches in 2017. Regulatory actions in the region are still evolving, as most of the countries in this region are still under the developing and emerging economy status.
Hardware OTP Token Authentication Market Positioning Analysis
Among the ten market players profiled for their presence in the global AI image recognition market, AWS, Google, IBM, Qualcomm, Microsoft, and Intel are the players who are among the top investor in R&D. AWS, in April 2018, has made their image recognition services available in new locations in Asia-Pacific, in Sydney. IBM already has begun implementing the usage of AI in image recognition and offers a stock of images to train the system.
Major Players - Authenex Inc., Dell Technologies Inc., Entrust Datacard Corporation, Gemalto N.V., Microcosm Ltd, Vasco Data Security International, Inc., RSA Security Llc, Surepassid Corp., Symantec Corporation And Vasco Data Security International Inc. among others
Reasons to Purchase the Report
- Current and future of Hardware OTP Token Authentication Market in the developed and emerging markets.
- Analyzing various perspectives of the market with the help of Porter’s five forces analysis.
- The segments that are expected to dominate the Hardware OTP Token Authentication Market.
- Regions that are expected to witness the fastest growth of Hardware OTP Token Authentication Market during the forecast period.
- Identify the latest developments, market shares and strategies of Hardware OTP Token Authentication Market employed by the major market players.
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