SecureData: A Fast-Growing, U.K.-Headquartered Security Services Vendor

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1 VENDOR PROFILE SecureData: A Fast-Growing, U.K.-Headquartered Security Services Vendor Juan Sacchi IDC OPINION SecureData is a growing managed security services provider headquartered in the U.K. with overseas operations mainly in the U.S., South Africa, and Europe. The company specializes in security consulting services and managed security services. SecureData provides a complete end-to-end security portfolio that focuses on helping customers assess the risks to which they are exposed, detect threats through the use of real-time security prevention, deploy security solutions to protect their information assets, and ultimately respond to breaches in a timely manner. IDC estimates that SecureData's worldwide security services revenue is $29.5 million, of which Europe accounts for 75%. The company employs approximately 130 security professionals worldwide and has two security operations centers located in the U.K. SecureData focuses on helping clients make use of their IT infrastructure to meet business needs in a flexible and secure way. SecureData aims to enable customers to use cloudbased services, network infrastructure, and Internet-based applications to their full potential. We think this is a good approach, particularly with the growth of as-a-service delivery models and the rapidly increasing use of mobile devices either company-owned or personal within user organizations. IN THIS VENDOR PROFILE This IDC Vendor Profile analyzes the current service portfolio and strategy of SecureData in the security services space in Europe in It also provides IDC's opinion of the strengths and weaknesses of the company in the overall security services market, as well as a brief description of SecureData's positioning in the competitive landscape against other vendors providing IT security services. This paper is based on a briefing from SecureData and IDC's background research into the security services space. SITUATION OVERVIEW Company Overview SecureData is a privately owned security consulting and managed services vendor headquartered in Maidstone, Kent in the U.K. The company was founded in 1992, and besides its Kent headquarters, has offices in Weybridge, Woking, and London in the U.K., and Pretoria and Cape Town in South Africa. February 2014, IDC #SL54W

2 SecureData signed its first managed security services deal in 2004; at that time the company was generating approximately $6.2 million in revenue. SecureData's worldwide revenue in 2013 was around $46.9 million, of which security services accounted for 63%. SecureData's revenue grew 18% in the past five years to Year-over-year growth in 2013 stands at 31% including the SensePost acquisition, while organic growth reached roughly 21%. TABLE 1 SecureData Security Services: February 2014 Snapshot Category Primary markets Details Consulting security services and managed security services (the company also sells security products) Number of employees globally ~130 Security services revenue in 2013: Worldwide (**) ~ $29.5 million (*) Security services revenue in 2013: Western Europe (**) ~ $22.2 million (*) Security services revenue in 2013: U.K. (**) ~ $17.7 million (*) Number of existing security operations centers External clients with devices under management or monitoring (***) Security website Two security operations centers (SOCs) located in the U.K (*) IDC estimates (**) Security services includes consulting and managed security services only (***) To December 2013 Source: IDC, March 2014 Figure 1 provides an IDC estimate of SecureData's revenue split by segment IDC #SL54W 2

3 FIGURE 1 SecureData Revenue by Segment Note: (*) Security products include software subscriptions Source: IDC, 2014 Figure 2 provides an IDC estimate of SecureData's security services revenue split by type of engagement IDC #SL54W 3

4 FIGURE 2 SecureData Security Services Revenue by Engagement Type Source: IDC, 2014 SecureData's Services Approach and Portfolio SecureData's approach is to look beyond point security solutions and ensure that business IT infrastructure as a whole is both secure and available. SecureData helps clients ensure their whole business IT infrastructure is secure through the use of the following methodology: Assess the risk to which the client might be exposed mostly through consulting type of engagements such as penetration testing, system life-cycle assessments, and governance, risk, and compliance Detect threats through the use of real-time security prevention includes fraud detection, application abuse, confidentiality breaches, integrity breaches, and availability breaches Protect information assets on an ongoing basis mostly done by managed security services or security-as-a-service (SaaS) types of service Respond to breaches this includes forensic solutions and incident response toolsets This methodology is fairly standard and does not add a different component or approach to what other services vendors use. It is also fair to say that this is not an area where we believe there is much room for differentiating. Supporting this methodological approach, SecureData provides an end-to-end security services portfolio called AffinitySecure a 24 x 7 proprietary platform that offers the following range of managed and cloud-based services: Managed services 2014 IDC #SL54W 4

5 Firewalls and next-generation firewalls Web content security Remote access Two-factor authentication Wireless security Intrusion detection and prevention systems (IDS/IPS) Load balancing Application security and delivery Switches/routers Onsite managed security information and event management (SIEM) Cloud-based services Security information and event management (SIEM) Cloud Internet gateway Application security and delivery Secure Internet breakout Phishing-as-a-Service Response-as-a-Service Security intelligence as a service Additionally, the company has strategic vendor partnerships with Arbor (distributed denial of service or DDoS), Blue Coat (content security and data loss prevention), Check Point (DDoS, endpoint security, among other technologies), Cisco, Imperva, Juniper Networks, RSA, Sourcefire, Websense, etc. In our view, this services portfolio is very comprehensive and covers the challenges of end-user organizations in the security space. This offering places SecureData in a good position to address the growing opportunities in the IT security market. However, we believe that integrating and orchestrating the offering is also a key component. In this regard, we see SecureData in a slightly weaker position compared with the stronger positioning of SecureData's security solutions portfolio. SecureData has dedicated service account managers focused on enabling cost-effective solutions to the customer and technical account managers (or technical guardians in SecureData's jargon) who look after the technology aspect of customer relationships. Regarding professional and industry certifications and technical expertise, SecureData has: 60+ certified technical experts available 24 x 7 30 security architects ISO throughout the entire organization 2014 IDC #SL54W 5

6 PCI QSAC (Qualified Security Assessor Company) ISO 9001/BS7799-certified throughout the entire organization Senior technical personnel with security clearance IL2- and IL3-accredited SOC providing data processing services to restricted government clients Strict adherence to ITIL v3 service management best practices U.K. government-accredited public services network (PSN) providers Company Strategy SecureData targets the midmarket and enterprise market, with its sweet spot in organizations with 2,500 to 5,000 employees. SecureData has clients in both the public sector, which accounts for approximately 30% of its revenue, and the private sector, where SecureData generates the rest of its turnover. The company provides services to a broad variety of industry verticals. In the enterprise segment, it is present in the finance industry, electronics, publishing, media, travel and airline carrier, construction, and engineering and business services. In the medium-sized market, SecureData operates in real estate and property management and hospitality sectors. Some of SecureData's clients are Admiral, Barclays, ARM, Capita, Deloitte, KPMG, BBC, the U.K. Environment Agency, easyjet, Sony, Ricoh, Financial Times and its owner Pearson, Camelot, and Virgin Games. The U.K. is SecureData's largest services market, accounting for approximately 60% of its services revenue. The U.S. is also an important market and contributes to 20% of services revenue. The remaining revenue (20%) spreads across the rest of the world, though South Africa and Western Europe are big contributors. Going forward, the company will focus on enlarging its footprint in its core geographic markets the U.K. and the U.S. FUTURE OUTLOOK Dealing with the increasing complexity of advanced persistent threats and the rapidly changing security threat environment represents a huge challenge for most public and private sector organizations. This challenge is increasing the pressure on both budgets and resources of most IT departments. The result is that the time, effort, and cost required for managing security data across the enterprise continues to increase without the business necessarily being any more secure or able to pass a security audit. All these present a major opportunity for the managed security services market. As part of its value proposition, SecureData emphasizes its focus on minimizing customer downtime and business disruption, as well as solving business challenges through vendor-agnostic consulting and security solutions delivery. We do not see this as a differentiator in terms of service value but rather as a must-have for services vendors, particularly with the increasing demand for cost-effective IT deployments from end-user organizations: IDC's 2013 End-User Organizations Survey showed that the top 3 strategic priorities for IT are improving the alignment of IT to business goals, improving overall IT service levels, and reducing the cost of IT IDC #SL54W 6

7 Additionally, SecureData aims to enable customers to use cloud services (including SaaS applications) and their network infrastructure to their full potential and free of security hazards. We think this is a much more compelling statement, and it could be taken further by focusing on the increasing complexity and security concerns deriving from the use of mobile devices for business purposes and IT consumerization including bring your own device (BYOD) among European public and private sector organizations. As these technologies and trends become mainstream among end-user organizations, enterprises will need support from IT security services vendors in order to adopt them while at the same time securing information assets. ESSENTIAL GUIDANCE IDC believes that an integrated end-to-end security portfolio is the right strategy, but it is not enough to provide substantial differentiation between SecureData services and what other worldclass security services vendors are offering or intending to offer. End-to-end security services solutions are evolving into a must-have for security services vendors as the number and complexity of attacks grows continuously. Nowadays, a strong differentiator cannot be technical tools and skills, but rather the capability to put together a cost-effective solution that addresses the requirements of clients' businesses. We therefore believe that the biggest challenge for SecureData is integrating and orchestrating its capabilities. SecureData is not alone in facing this challenge; it is also a big challenge for many of the larger managed security vendors. IDC estimates that SecureData's 2013 revenue in the managed security services space in the U.K. for 2013 was $13.2 million, which places SecureData in the top 10 to 15 managed security services vendors in the country. This is a remarkable achievement for a medium-sized IT security vendor. However, IDC believes that SecureData's brand awareness and positioning in the market lag its business volume, capabilities, and breadth of clients, and we believe that the company would benefit from raising its profile. We believe SecureData has a great opportunity in what IDC calls the four pillars of the 3rd Platform cloud-based services, social business, Big Data/analytics, and mobility. We are seeing these factors hugely transform end-user businesses and what they demand from IT security services vendors. SecureData's internal capabilities and ongoing partnerships with security technology vendors give it the opportunity to become a trusted security partner around the four pillars for enduser organizations. Additionally, being a relatively small vendor, SecureData should be able to react faster to changes in clients' needs and on the IT security market overall. Provided SecureData is able to address organizations' demand for cost-effective security solutions around cloud, Big Data/analytics, and mobility, as well as demonstrate to clients how they can benefit from the orchestration of SecureData's internal and external capabilities, we would expect the company to continue to show a substantial level of growth IDC #SL54W 7

8 LEARN MORE Related Research European Security Life-Cycle Services: Market Analysis Perspective (IDC #SL53W, March 2014) Western Europe IT Services Forecast: A 4Q13 Update (IDC #SL52W, February 2014) Thoughts from IBM's Smarter Risk Event (IDC #SL51W, January 2014) Western Europe Managed Security Services, Top 20 Vendors in 2012 (IDC #SL56V, December 2013) European Enterprise Survey 2013: IT Security Services (IDC #SL03V, September 2013) Western European 2012 Security Services Market and Forecast (IDC #SL02V, September 2013) 2014 IDC #SL54W 8

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