2012 North American Enterprise Firewalls Market Penetration Leadership Award

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1 North American Enterprise Firewalls Market Penetration Leadership Award 2012 Frost & Sullivan 1 We Accelerate Growth

2 Market Penetration Leadership Award Enterprise Firewalls North America, 2012 Frost & Sullivan s Global Research Platform Frost & Sullivan is in its 50th year of business with a global research organization of 1,800 analysts and consultants who monitor more than 300 industries and 250,000 companies. The company s research philosophy originates with the CEO s 360-Degree Perspective, which serves as the foundation of its TEAM Research methodology. This unique approach enables us to determine how best-in-class companies worldwide manage growth, innovation and leadership. Based on the findings of this Best Practices research, Frost & Sullivan is proud to present the 2012 North American Market Penetration Leadership Award in Enterprise Firewalls to Fortinet. Significance of the Market Penetration Leadership Award Key Industry Challenges The unyielding and increasingly complex nature of cyber attacks in recent years has forced enterprises to re-evaluate their network defenses. Additionally, emerging enterprise technologies, such as virtualization, cloud computing, and mobile devices, have opened new channels for hackers. Enterprise firewall vendors are competing to design the newest and best security features, offering the most comprehensive protection. These next generation security technologies will not only offer superior protection, but also market growth. However, the Enterprise Firewall market has become increasingly competitive in recent years and vendors find themselves competing on protection capabilities and value-adding features. Enhancing market position in today s Enterprise Firewall market depends entirely on meeting ever-evolving protection needs while also offering superior performance and customer value. The enterprise firewall has undergone a rapid technological evolution since 2009, owing to the need to perform more contextual security inspections and the need to support emerging technologies. Vendors that can solve these challenges will enable customers to adopt emerging technologies such as cloud services and mobile enterprise devices. These days, the business value of security technologies is a top priority for enterprise organizations. Security products must be reliable and scalable, enabling cutting-edge business practices. This will facilitate measurable return-on-investment that is critical for a product with unquantifiable security value. By focusing on these customer challenges, the Enterprise Firewall market achieved strong growth rates in However, as mentioned earlier, the market is becoming increasingly competitive. Vendors can rapidly increase their market penetration by solving technology challenges and delivering valuable security tools Frost & Sullivan 2 We Accelerate Growth

3 Best Practice Award Analysis for Fortinet The Frost & Sullivan Award for Market Penetration Leadership is presented each year to the company that has demonstrated excellence in capturing the fastest measured rate of change of market share within its industry. This Award recognizes how fast a company increases its penetration of a market, in terms of revenues or units as specified. Fortinet s Performance in Enterprise Firewall Fortinet s revenue reached $433.6 million in 2011, an increase of 33.5% compared to The company s product revenue increased 46.1% compared to 2010 and it is directly attributed to increased adoption of the Fortinet s enterprise security products. These enterprise firewall products now account for approximately a third of the company s revenues. Key Performance Drivers for Fortinet Fortinet s rapid growth in the Enterprise Firewall market is due to its focus on quality and high-performance products. Furthermore, the company continues to add new technologies and products to its portfolio including its latest major operating system release, which includes 150 new features. This focus on enterprise features and performancepropelled Fortinet s rise in the Enterprise Firewall market in Factor 1: Focus on Customer Value Fortinet offers a strong value proposition of comprehensive network security in a single, easily deployed network appliance. This allows businesses of all sizes to reduce the hardware investment costs associated with multiple point security products. Customers can also earn better discounting by investing in security services from a single vendor rather than many specialized vendors. Furthermore, Fortinet customers benefit from the company s simple and cost-effective licensing model. FortiOS is the operating system that powers all of the FortiGate security products and each FortiGate device includes the full suite of security technologies such as next generation firewall (NGFW), SSL and IPsec VPN, application control, IPS, Web content filtering, gateway antimalware, on-device sandboxing, cloud-based IP reputation management, integrated wireless access controller, anti-spam, WAN optimization, anti-ddos, vulnerability management, identity management, and DLP. Flexible form factors (hardware appliance, virtual machine and SaaS) give customers the flexibility to choose the deployment option that fits their environment and allow Managed Security Service Providers (MSSPs) the ability to build a successful security practice. Fortinet s security subscription bundle provides automatic updates to several of the security 2012 Frost & Sullivan 3 We Accelerate Growth

4 technologies included in the FortiGate device from its FortiGuard Labs global threat research team. These updates help ensure the FortiGate device is running the most up-to-date threat protection. Fortinet is also helping customers take advantage of virtualization and cloud infrastructure with a wide range of security products for VMware and Citrix Xen Virtual Machine environments, including FortiGate. Fortinet also recently announced select product support for the Amazon Web Services environment, allowing customers to deploy the same technology on-premise as well as in the Amazon cloud. Central management plays a key role is consolidating functions and allows a cost effective distributed deployment of Network security. IT organizations are under tremendous pressure to lower costs by consolidating technologies and expanding the effectiveness of existing team members. To support the consolidation imperative, Fortinet has invested heavily in its central policy management, log analysis, reporting capability and threat intelligence functions. Fortinet s single-pane-of-glass approach provides a management console that provides users with improved visibility and control of policies, content and users. This product value was first recognized by small and medium size businesses, which represented the core of Fortinet s customer base for many years. However, customers now need to reduce operating expenses regardless of company size or vertical market. Enterprise organizations now recognize the excellent value behind the FortiGate products. Factor 2: Product Performance Increases In terms of security functionality, the distinction between the SMB firewall (also called UTM) and enterprise firewall has been dissolving since Both products are hardware platforms that are capable of performing multiple, essential security functions. This definition change has facilitated Fortinet s acceptance in the Enterprise market. However, customers still require reliable and scalable security products that are capable of supporting the extreme traffic demands in enterprise networks. In recent years, Fortinet has assembled a number of high-end FortiGate appliances for enterprise main offices, data centers, and service providers. The most scalable FortiGate appliance is the 5000 Series, a chassis-based firewall with multiple blade servers. The FortiGate 5000 Series can reach up to 480 Gbps of firewall throughput with the full array of 14 firewall blades. All FortiGate appliances are accelerated by custom ASICs, which provide the high-volume high speed content filtering capabilities that off-the-shelf processors cannot Frost & Sullivan 4 We Accelerate Growth

5 Factor 3: Increased Product Research and Development Enterprise networks are under increasingly sophisticated attacks by skilled hacker groups. Firewall vendors are challenged to develop new security technologies that are capable of detecting sophisticated cyber attacks. Further complicating the situation is the growing adoption of new technologies such as virtualization, cloud computing, and Bring-Your-Own- Device (BYOD). These new technologies are essential in a modern business strategy but can also open new attack vectors. In October 2012, Fortinet announced the latest major release of its secure operating system, FortiOS 5.0. This release included over 150 new features. For example, FortiOS 5.0 will enable businesses to solve security challenges represented by BYOD initiatives with the ability to assign policies automatically based on user ID and device type. Fortinet is also adding protection technologies such as in-line sandboxing and reputation systems to find and block advanced malware on the corporate network or detect compromised systems. Fortinet also continues to expand its investment in the FortiGuard Labs internal threat research team, to expand its threat research capability. These new features, along with the expanded research capabilities, provide superior network protection and business value that enterprise organizations require. Factor 4: Strong Brand Name Recognition Fortinet has a strong reputation for quality in the UTM market. However, UTM firewalls are considered SMB products because of previous product limitations in the market. This is thanks to competitors that focused on value and lower costs, instead of product performance and product development. However, Fortinet has consistently provided quality security products that are built from the ground up with custom hardware to enhance product performance. This reputation for quality in the UTM market has helped propel the company s success in the Enterprise Firewall market. Furthermore, Fortinet has demonstrated the ability to understand enterprise requirements and deliver new features and technologies that provide the most value. This has translated to rapid growth in the Enterprise Firewall market. Conclusion Enterprise organizations have demanding requirements for security products. Enterprise firewalls must be highly scalable, reliable, and provide cutting-edge features. Fortinet s strong growth in the Enterprise market in 2011 was due to aggressive product development and an unwavering focus on product value. This strategy provides customers with the superior protection necessary for a modern enterprise network. Based on Frost & 2012 Frost & Sullivan 5 We Accelerate Growth

6 Sullivan s independent analysis of the Global Enterprise Firewall (including NGFW) market, Fortinet is recognized with the 2012 Market Penetration Leadership Award. The CEO360-Degree Perspective TM - Visionary Platform for Growth Strategies The CEO 360-Degree Perspective model provides a clear illustration of the complex business universe in which CEOs and their management teams live today. It represents the foundation of Frost & Sullivan's global research organization and provides the basis on which companies can gain a visionary and strategic understanding of the market.the CEO 360-Degree Perspective is also a must-have requirement for the identification and analysis of best-practice performance by industry leaders. The CEO 360-Degree Perspective model enables our clients to gain a comprehensive, action-oriented understanding of market evolution and its implications for their companies growth strategies. As illustrated in Chart1 below, the following six-step process outlines how our researchers and consultants embed the CEO 360-Degree Perspective into their analyses and recommendations. Chart1: The CEO's 360-Degree Perspective Model 2012 Frost & Sullivan 6 We Accelerate Growth

7 Critical Importance of TEAM Research Frost & Sullivan s TEAM Research methodology represents the analytical rigor of our research process. It offers a 360-degree view of industry challenges, trends, and issues by integrating all seven of Frost & Sullivan's research methodologies. Our experience has shown over the years that companies too often make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Frost & Sullivan contends that successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. In that vein, the letters T, E, A and M reflect our core technical, economic, applied (financial and best practices) and market analyses. The integration of these research disciplines into the TEAM Research methodology provides an evaluation platform for benchmarking industry players and for creating high-potential growth strategies for our clients. Chart2: Benchmarking Performance with TEAM Research About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages 50 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 40 offices on six continents. To join our Growth Partnership, please visit Frost & Sullivan 7 We Accelerate Growth

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