Managed Detection and Response Services Market Analysis North America, Europe, APAC, South America, Middle East and Africa - US, China, India, UK, Germany - Size and Forecast 2024-2028

Managed Detection and Response (MDR) Services Market Forecast 2024-2028

The managed detection and response (MDR) services market size is projected to increase by USD 6.20 Billion, at a CAGR of 23.58% between 2023 and 2028. An increase in the adoption of hosted services is the key factor driving market growth. Due to the surge in the number of mobile workers and remote workforces, enterprises are facing a lot of data security threats. An increase in the number of data thefts and fraud incidents and the growing concerns about virtual private network (VPN), email security, and web services are encouraging enterprises to adopt these services.

Convergence of technologies due to the growing complexity of IT & Telecom infrastructure is the primary trend shaping market growth. This necessitates the development of cybersecurity skills among security researchers and engineers to effectively operate cybersecurity service and security operations center (SOC). Additionally, compliance with regulations such as the General Data Protection Regulation (GDPR) is driving the adoption of Artificial Intelligence (AI) and Machine Learning (ML) in BFSI (Banking, Financial Services, and Insurance), Retail & E-commerce, and other sectors for enhanced security measures.

What will be the Size of the Market During the Forecast Period?

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Market Segmentation By End-user

The market share growth by the large enterprises segment will be significant during the forecast period. Large enterprises are the leading organization size in the global market, supporting growth with their sophisticated cybersecurity requirements. Large companies place a premium on strong threat detection and response capabilities due to their extensive networks and vital data assets. These services address these requirements by providing advanced threat information, real-time monitoring, and incident response.

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The large enterprises segment showed a gradual increase in the market share of USD 757.57 million in 2018. Organizations such as a major global financial institution and a leading technology conglomerate have used these solutions to improve their cybersecurity posture, demonstrating the essential role that MDR plays in protecting large organizations from complex cyber threats. As cyber dangers evolve, the demand for MDR services among large organizations is expected to increase significantly, which, in turn, is expected to drive the growth of the MDR services market during the forecast period.

Market Segmentation By Deployment

The hosted segment includes both hybrid and pure hosted services. In hybrid service, the infrastructure is owned by the enterprises but is remotely managed by the service provider. At the same time, in pure hosted services, the service providers own the infrastructure for security and provide the service by using the cloud. Additionally, infrastructure is provided by the vendor, and enterprises can access it with the help of the cloud. The shift from traditional security solutions to hosted solutions has increased the year-over-year growth rate of this segment. Consequently, the hosted segment is expected to grow faster than the on-premises segment and hence drive the growth of the market during the forecast period.

Regional Overview

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North America is estimated to contribute 36% to the growth of the global market during the forecast period. 
Technavio's analysts have provided extensive insight into the market forecast, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. The growth of the market in North America is driven by the presence of cybersecurity solution vendors and strong cybersecurity regulations. Also, the rising investments by well-established economies in the region in R&D activities to develop new security technologies are expected to drive the market in North America.

Further, the increase in the number of external and internal threats to organizations in the Americas and the growing adoption of the IoT in the US and Canada are fueling the adoption of MDR services in North America. One of the major reasons for the growth of this market in the US is the integration of technologies such as user behavior analytics with MDR. Canada is also among the leading contributors to this market. Hence, such factors are expected to drive market growth in this region during the forecast period.

Market Dynamics and Customer Landscape

The Managed Detection and Response Services Market is experiencing growth driven by the adoption of hosted services, offering organizations enhanced capabilities to detect and respond to ransomware and crypto-jacking incidents. A significant trend in this market is the convergence of technologies, with solutions integrating Artificial Intelligence (AI), Machine Learning (ML), and advanced detection algorithms to combat evolving cybersecurity threats. However, the industry faces challenges such as the reduction in the efficiency of systems, stemming from the complexity of security alerts and government regulations like the General Data Protection Regulation (GDPR). With a focus on sectors such as BFSI, IT & Telecom, and Retail & E-commerce, Managed Detection and Response (MDR) services provide organizations with proactive monitoring, threat intelligence, and incident response capabilities to safeguard data and assets.

As cybersecurity threats continue to evolve, MDR providers play a crucial role in operating security operations centers (SOC), employing skilled security researchers and engineers to address security cases effectively. Informed by market growth analysis, MDR services evolve to meet the dynamic cybersecurity landscape, ensuring organizations stay ahead of emerging threats and compliance requirements.

Key Market Trends

An increase in the adoption of hosted services is the key factor driving market growth. Due to the surge in the number of mobile workers and remote workforces, enterprises are facing a lot of data security threats. An increase in the number of data thefts and fraud incidents and the growing concerns about virtual private network (VPN), email security, and web services are encouraging enterprises to adopt these services. The increasing use of cloud computing and the management of high volumes of data are commonly noticed among large enterprises as well as SMEs. As a result, it is natural for enterprises to shift their attention to information security. However, implementing in-house security infrastructure is a complex task, and it also requires a high cost for maintenance.

Consequently, hosted market vendors help enterprises in responding to potential attacks with ease. In these solutions, the huge cost incurred by these service providers for implementing cloud infrastructure is spread out over multiple customers. Hence, such solutions provide a way for enterprises to shift their IT security expense from capital expenditure (CAPEX) to operating expenditure (OPEX). This gives enterprises an option for affordable, scalable, and state-of-the-art security solutions around the clock. Thus, this will encourage enterprises to adopt hosted services, which will drive market growth during the forecast period.

Significant Market Trends

Convergence of technologies due to the growing complexity of IT infrastructure is the primary trend shaping market growth. Aligning with market trends and analysis, the need to protect networks from advanced cyber threats has led companies around the world to adopt multiple security solutions such as VPN, firewall, antimalware, encryption, server security, data loss prevention, antivirus, and backup. However, the complexity of the IT infrastructure has increased with the high adoption of different types of security solutions. Hence, end-users are finding it difficult to manage them.

To overcome this challenge, companies are opting for converged security solutions. The market for converged security solutions, such as endpoint security suits, is growing rapidly. Hence, the convergence of multiple technologies is one of the major emerging trends in the market, driving the market during the forecast period as well. Thus, such factors are expected to drive market growth during the forecast period.

Major Market Challenges

Reduction in the efficiency of systems due to managed detection and response services implementation is a challenge that affects market growth. While the use of these services increases the overall security of a company's network, it results in a slowdown in the network traffic because of multiple security rings. The multifunctional devices used in firewalls slow down the traffic as their multiple security rings affect the efficiency of the systems.

Moreover, any impact on the performance of the system will have an adverse impact on the companies, especially in the e-commerce and banking sectors, which are highly dependent on online content and transactions. This may force companies to adopt alternative solutions, impeding the growth of the market during the forecast period.

Market Customer Landscape

The market forecasting report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and trends strategies.

Global Market Customer Landscape

Who are the Major Market Companies?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

• Alphabet Inc.: The company offers managed detection and response services that defend business across endpoint, network, cloud, email, and operational technology, providing around-the-clock, lightning-fast detection, human analysis, and expert response through its subsidiary Mandiant.
• Broadcom Inc.: The company offers managed detection and response services that provide critical insight into attacks using automated machine learning algorithms to validate and prioritize alerts and uncover new threats.
• Cisco Systems Inc.: The company offers managed detection and response services that combine an elite team of researchers, investigators, and responders with integrated threat intelligence to detect and contain threats faster while delivering relevant and prioritized response actions.

The  Market  growth and forecasting report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:

• Arctic Wolf Networks Inc.
• Armor Defense Inc
• Blackpoint Cyber
• Booz Allen Hamilton Holding Corp.
• Check Point Software Technologies Ltd.
• CrowdStrike Holdings Inc.
• Cybereason Inc
• Cynet security Ltd
• Dell Technologies Inc.
• eSentire Inc.
• Fortinet Inc.
• International Business Machines Corp.
• Palo Alto Networks Inc.
• Rapid7 Inc.
• SENTINELONE INC.
• Sophos Ltd.
• Trend Micro Inc.
• Trustwave Holdings Inc.

The market analysis and report of qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Market Analyst Overview

The Managed Detection and Response Services Market is witnessing unprecedented growth fueled by the surge in ransomware and crypto-jacking incidents. With government regulations and compliance requirements tightening around data protection, IT and ITeS organizations are seeking robust solutions to safeguard their IoT devices and networks.

MDR providers are leveraging artificial intelligence and machine learning to enhance detection algorithms and behavioral analytics, enabling expert investigation of security alerts and cyberattacks. This proactive approach, supported by Managed Endpoint Detection and Response (MEDR), Managed Network Detection and Response (MNDR), and Cloud Detection and Response (CDR) services, ensures swift response to security cases and vulnerability management.

Furthermore, MDR systems offer flexibility and improved security, reducing the cost of maintenance and mitigating operational risks. Cloud-based MDR software and app-based managed detection and response solutions cater to the evolving landscape of cloud technology, mobile devices, and web applications. By addressing threats like phishing and SQL injection, businesses can uphold compliance and ensure business continuity amidst rapid digitization.

In essence, as cybersecurity awareness grows, Managed Detection and Response Services play a pivotal role in safeguarding customer data and minimizing the risk to businesses from cyber security attacks.

Segment Overview

The market research report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018-2028

• End-user Outlook
  • Large enterprises
  • Small and medium enterprises

• Deployment Outlook
  • Hosted
  • On-premises

• Region Outlook
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • South America
    • Chile
    • Brazil
    • Argentina
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Scope
Report Coverage	Details
Page number	171
Base year	2023
Historic period	2018 - 2022
Forecast period	2024-2028
Growth momentum & CAGR	Accelerate at a CAGR of 23.58%
Market Growth 2024-2028	USD 6.20 billion
Market structure	Fragmented
YoY growth 2023-2024(%)	23.04
Regional analysis	North America, Europe, APAC, South America, and Middle East and Africa
Performing market contribution	North America at 36%
Key countries	US, China, India, UK, and Germany
Competitive landscape	Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks
Key companies profiled	Alphabet Inc., Arctic Wolf Networks Inc., Armor Defense Inc, Blackpoint Cyber, Booz Allen Hamilton Holding Corp., Broadcom Inc., Check Point Software Technologies Ltd., Cisco Systems Inc., CrowdStrike Holdings Inc., Cybereason Inc, Cynet security Ltd, Dell Technologies Inc., eSentire Inc., Fortinet Inc., International Business Machines Corp., Palo Alto Networks Inc., Rapid7 Inc., SENTINELONE INC., Sophos Ltd., Trend Micro Inc., and Trustwave Holdings Inc.
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period
Customization purview	If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market report forecast during the forecast period
• Detailed information on factors that will drive the market growth and forecasting between 2024 and 2028
• Precise estimation of the market size and its contribution to the market in focus on the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market across North America, Europe, APAC, South America, and Middle East and Africa
• Thorough market analysis and report of the market’s competitive landscape and detailed information about companies
• Market forecasting of factors that will challenge the growth of Industry companies

 

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