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The market dynamics of Applied Artificial Intelligence (AI) in cybersecurity have been witnessing rapid evolution and growth in recent years, driven by the escalating sophistication of cyber threats and the increasing adoption of AI technologies to combat these threats. Applied AI in cybersecurity refers to the use of AI algorithms and machine learning techniques to detect, analyze, and respond to cyber threats in real-time. One of the primary drivers of market growth is the rising frequency and complexity of cyber attacks targeting organizations of all sizes and across various industries. Cybercriminals are constantly evolving their tactics, techniques, and procedures (TTPs) to bypass traditional security defenses, making it increasingly challenging for organizations to detect and mitigate cyber threats using manual or rule-based approaches alone.
Moreover, there is a growing recognition among organizations that traditional security measures such as antivirus software, firewalls, and intrusion detection systems (IDS) are no longer sufficient to protect against advanced and targeted cyber attacks. As a result, there is a growing demand for AI-powered cybersecurity solutions that can analyze large volumes of security data, identify patterns and anomalies indicative of malicious activity, and automate response actions in real-time. Applied AI technologies such as machine learning, deep learning, and natural language processing enable organizations to enhance threat detection capabilities, reduce response times, and adapt to evolving threats more effectively than traditional security approaches.
Another key driver of market growth is the increasing adoption of cloud computing and digital transformation initiatives, which are driving organizations to rethink their cybersecurity strategies and invest in more advanced and agile security solutions. Cloud computing and digital transformation initiatives introduce new attack vectors and security challenges, such as data breaches, insider threats, and misconfigurations, which require innovative approaches to cybersecurity. AI-powered cybersecurity solutions provide organizations with the scalability, flexibility, and automation capabilities needed to protect cloud-based workloads, applications, and data from emerging threats and vulnerabilities. By leveraging AI technologies, organizations can gain better visibility into their cloud environments, detect and respond to security incidents faster, and enforce consistent security policies across hybrid and multi-cloud environments.
Furthermore, there is a growing emphasis on threat intelligence and proactive defense strategies within the applied AI in cybersecurity market. Traditional security approaches often rely on reactive defenses, such as signature-based detection and manual incident response, which are ineffective against advanced and unknown threats. Applied AI technologies enable organizations to proactively identify emerging threats, predict potential attack vectors, and preemptively block or mitigate security incidents before they can cause harm. By integrating threat intelligence feeds, security analytics, and AI-driven security orchestration and automation platforms (SOAPs), organizations can enhance their threat detection and response capabilities, reduce the time to detect and remediate security incidents, and improve overall security posture.
Additionally, there is a growing trend towards the integration of AI-powered cybersecurity solutions with Security Operations Centers (SOCs) and Security Information and Event Management (SIEM) platforms to provide comprehensive threat detection and response capabilities. AI-powered cybersecurity solutions can ingest and analyze vast amounts of security data from disparate sources, including network logs, endpoint telemetry, and threat intelligence feeds, to identify and prioritize security alerts and incidents. By integrating with SIEM platforms and SOCs, AI-powered cybersecurity solutions enable security analysts to correlate and contextualize security events, automate incident triage and investigation processes, and orchestrate response actions across heterogeneous security infrastructure. This integration streamlines security operations, enhances collaboration between security teams, and improves the efficiency and effectiveness of incident response workflows.
Moreover, there is a growing focus on explainability, transparency, and trustworthiness in AI-powered cybersecurity solutions, as organizations seek to understand how AI algorithms make decisions and ensure that they are not biased or susceptible to adversarial attacks. Explainable AI (XAI) techniques such as model interpretability, feature attribution, and decision rationale analysis enable organizations to understand and interpret the behavior of AI algorithms and identify potential biases or vulnerabilities. Additionally, organizations are investing in AI governance frameworks, ethical AI principles, and regulatory compliance measures to ensure that AI-powered cybersecurity solutions are developed and deployed in a responsible and accountable manner. By prioritizing explainability, transparency, and trustworthiness, organizations can build confidence in AI-powered cybersecurity solutions and foster trust among stakeholders, customers, and regulators.
Covered Aspects:
| Report Attribute/Metric | Details |
|---|---|
| Segment Outlook | Organization Size, Deployment Type, Security Type, Application, and End User |
Applied AI in Cybersecurity Market Highlights:
Applied AI in Cybersecurity Market Overview
Applied AI in Cybersecurity Market Size was valued at USD 1.9 billion in 2022. The applied AI in cybersecurity market industry is projected to grow from USD 2.2 billion in 2023 to USD 15.8 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 24.5% during the forecast period (2023 - 2032).
The cybersecurity industry has witnessed immense growth in recent years, and it's reshaping the use of Artificial Intelligence (AI) in cybersecurity. This growth is mainly due to the increasing necessity to protect internet-connected systems, including hardware, software, and data, from a wide range of threats like hacking, malware, phishing, and ransomware.
Further, the global cost of damage from cyberattacks is projected to reach a staggering US$ 10.5 trillion annually by 2025, representing a 300% increase from the levels seen in 2015. This alarming trend underscores the urgency for robust cybersecurity measures and the potential for the cybersecurity market to expand even further.
Previously, cybersecurity relied on rule-based systems and signature-based detection methods. These methods often struggle to keep up with the rapidly evolving and sophisticated cyber threats we face today. The reliance on human analysts for manual data review led to delayed responses and missed vulnerabilities, especially in high-volume environments.
AI represents a new era in cybersecurity, with its visionary threat detection, adaptive learning, behavioral analysis, pattern recognition, and real-time response capabilities. AI systems are now capable of analyzing vast datasets, detecting subtle anomalies, and identifying complex attack patterns across diverse data sources, even when attackers employ camouflage tactics. This AI-driven approach minimizes false positives, automates real-time threat responses, and empowers proactive threat hunting.
The growth of the cybersecurity market is intrinsically linked to the surging demand for AI in various critical areas, including malware detection, adversarial machine learning, network traffic analysis, penetration testing, and real-time threat intelligence. AI-driven systems can detect and classify new malware in real-time, defend against adversarial attacks, and identify potential threats through behavioral analysis and anomaly detection. This integration of AI not only boosts the effectiveness of cybersecurity measures but also offers a significant advantage in staying ahead of rapidly evolving cyber threats.
FIGURE 1: APPLIED AI IN CYBERSECURITY MARKET SIZE 2019-2032 (USD BILLION)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
Applied AI in Cybersecurity Market Trends
AI-Powered Security Analytics to Create Positive Sphere for the Given Market Growth
AI-powered security analytics is revolutionizing the cybersecurity landscape by harnessing the power of artificial intelligence and machine learning to combat the ever-evolving threat landscape. In an era where cyberattacks are growing in complexity and frequency, traditional security measures are no longer sufficient. AI-driven security analytics steps in to fill this gap, analyzing vast datasets in real-time to detect and respond to threats that might otherwise go unnoticed. By continuously learning from historical data and adapting to new attack vectors, AI identifies anomalies and patterns that signal potential breaches, enabling organizations to take proactive measures to protect their digital assets.
The application of AI in cybersecurity is a key driver of the rapidly expanding applied AI market within this sector. With the exponential growth in data volumes, the shortage of skilled cybersecurity professionals, and the need for real-time threat detection and response, AI-powered security analytics offers an efficient and cost-effective solution. Its ability to provide actionable insights and automate tasks not only enhances an organization's security posture but also ensures compliance with stringent data protection regulations. As cyber threats continue to evolve, AI remains at the forefront, empowering cybersecurity professionals with the tools they need to stay one step ahead of adversaries and safeguard sensitive information in an interconnected world.
Applied AI in Cybersecurity Market - Segment Insights
Applied AI in Cybersecurity Market - Organization Size
The Applied AI in Cybersecurity Market, in this report, is segmented as organization size which is further bifurcated into large enterprises and SMEs. Large enterprises hold a prominent share in the market.
Large enterprises are increasingly turning to applied AI in cybersecurity due to the rising complexity of cyber threats. These organizations, often prime targets, benefit from AI's real-time data analysis, anomaly detection, and automated threat response capabilities. AI adapts to evolving threats, making it a cost-effective and efficient security solution. Regulatory compliance and heightened awareness of cybersecurity risks further drive this demand. As cyberattacks evolve, large enterprises prioritize AI-driven solutions to protect their valuable data and ensure operational continuity.
Applied AI in Cybersecurity Market - Deployment Type
The Applied AI in Cybersecurity Market, in this report, has been segmented on the basis of deployment type into on-premises and cloud.
The demand for cloud-based applied AI in cybersecurity is booming due to its scalability, flexibility, and efficiency. Cloud platforms offer the computational power required to process and analyze vast amounts of data quickly. This enables AI algorithms to detect and respond to threats in real-time. Additionally, cloud-based solutions can be easily integrated with existing security infrastructure and provide cost-effective alternatives to traditional on-premises setups. As organizations increasingly rely on the cloud for their operations, the need for AI-driven cybersecurity solutions delivered via the cloud has surged, ensuring robust protection against evolving cyber threats.
FIGURE 2: APPLIED AI IN CYBERSECURITY MARKET, BY DEPLOYMENT, 2022 VS 2032 (USD BILLION)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
Applied AI in Cybersecurity Market - Security Type
The Applied AI in Cybersecurity Market, in this report, has been segmented on the basis of security type into network security, endpoint security, application security, cloud security, ICS security, IoT security, and others. Cloud security is gaining traction.
Applied AI in cybersecurity is extensively employed for cloud security due to its adaptability and efficiency. It offers real-time monitoring, automation, and cost-effectiveness, aligning well with the dynamic nature of cloud environments. These solutions seamlessly integrate with cloud platforms and services, enabling robust protection for cloud-native applications and data. Cloud-based AI leverages global threat intelligence and can be easily updated and maintained by service providers, ensuring organizations stay ahead of evolving threats and meet compliance requirements. This combination of factors makes AI a vital component in safeguarding cloud-based assets and data.
Applied AI in Cybersecurity Market - Application
The Applied AI in Cybersecurity Market, in this report, has been segmented on the basis of application into identity and access management, risk and compliance management, data loss prevention, unified threat management, security and vulnerability management, antivirus/antimalware, fraud detection/anti-fraud, intrusion detection/prevention system, threat intelligence, and others.
Identity and access management (IAM) applications are gaining traction in the applied AI in cybersecurity market due to their crucial role in safeguarding digital assets. IAM solutions, enhanced by AI, provide advanced user authentication and authorization, ensuring only authorized individuals access sensitive data and systems. AI helps detect unusual access patterns and potential insider threats, bolstering security. As cyberattacks increasingly target user credentials, IAM with AI-driven features strengthens defenses by continuously adapting to evolving threats, making it an essential component in the cybersecurity landscape.
Applied AI in Cybersecurity Market - End User
The Applied AI in Cybersecurity Market, in this report, has been segmented based on end user into BFSI, retail, government & defense, manufacturing, utilities, oil & gas, healthcare, automotive & transportation, and other.
The demand for applied AI in cybersecurity is growing within the government and defense sectors due to their critical need for robust protection against increasingly sophisticated cyber threats. Governments and defense agencies store sensitive national security data and must safeguard critical infrastructure. AI offers advanced threat detection, real-time monitoring, and automated response capabilities, enhancing cyber resilience. Furthermore, AI can analyze large datasets to identify and mitigate emerging threats quickly. Given the strategic importance of secure information and infrastructure, these sectors are increasingly investing in AI-driven cybersecurity solutions to stay ahead of cyber adversaries.
Applied AI in Cybersecurity Market - Regional Insights
Based on Region, the global applied AI in cybersecurity is segmented into North America, Europe, Asia-Pacific, Middle East & Africa, and South America. Further, the major countries studied in the market report are the U.S., Canada, Germany, UK, Italy, Spain, China, Japan, India, Australia, UAE, and Brazil.
The cybersecurity market is poised to reach US$ 162.0 billion by 2023, primarily driven by Security Services with a projected volume of US$ 85.49 billion. This growth is anticipated to continue at an annual rate of 9.63%, reaching US$ 256.50 billion by 2028. The average spend per employee in cybersecurity is predicted to reach US$46.54 in 2023, and the United States is set to generate the highest revenue, at US$ 68,680.0 million in 2023.
This increasing investment in cybersecurity is fueling demand for applied AI in the field. Applied AI augments cybersecurity by enabling faster and more accurate threat detection and response. It also enhances cost efficiency and scalability while contributing to global cybersecurity resilience. As a result, the synergy between growing cybersecurity investments and applied AI is delivering substantial positive impacts, fortifying defenses against evolving cyber threats and safeguarding digital assets on a global scale.
FIGURE 3: APPLIED AI IN CYBERSECURITY MARKET SIZE BY REGION 2022 VS 2032, (USD BILLION)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
The growing investment in cybersecurity by both the United States and Canada is having a significant impact on the demand for applied AI in the cybersecurity sector, thereby driving the growth of the North American applied AI in the cybersecurity market. In June 2022, the U.S. announced substantial spending for cybersecurity, earmarking US$ 15.6 billion for the fiscal year 2023. Out of this allocation, US$ 11.2 billion is designated for the Department of Defense (DoD), while US$ 2.9 billion is allocated to the Cybersecurity and Infrastructure Security Agency (CISA).
The DoD plans to utilize its funding in various ways, including expanding its cyber mission force teams, to add five new teams to the existing ones. These teams primarily focus on defensive cyber operations. This marks a significant increase compared to previous years, indicating a gradual growth in cybersecurity investment, with US$ 8.64 billion spent in 2021 and a slight increase in 2022.
Further, Canada is also investing substantially in cybersecurity. Their spending initiatives include funding to enhance the Communications Security Establishment's (CSE) abilities for offensive cyber operations, defending against cyber-attacks, protecting critical infrastructure, and fortifying cybersecurity for smaller departments, agencies, and Crown corporations. Moreover, Canada is allocating resources to support cybersecurity researchers in fields like quantum computing and artificial intelligence.
Specifically, Canada is proposing to allocate US$ 17.7 million over five years for a research chair program aimed at funding academics researching cutting-edge technologies relevant to CSE's activities, including AI. Researchers awarded these grants will engage in both publishable research and classified research at CSE.
Moreover, there is a focus on countering online misinformation from adversaries. Global Affairs Canada is slated to receive US$ 13.4 million over five years to renew and expand the G7 Rapid Response Mechanism, aimed at addressing disinformation and foreign threats. This mechanism has played a pivotal role in detecting foreign interference and state-sponsored disinformation, including during federal elections in Canada.
Hence, the increased investments in cybersecurity by the U.S. and Canada are leading to a rising demand for applied AI solutions in the cybersecurity sector. This, in turn, is fostering the growth of the North American applied AI in the cybersecurity market.
Applied AI in Cybersecurity Market - Key Market Players and Competitive Insights
Market players in the applied AI in cybersecurity sector employ various growth strategies to stay competitive and capitalize on the surging demand for advanced security solutions. They continuously invest in research and development to innovate and offer cutting-edge AI-powered cybersecurity technologies. Collaboration through strategic partnerships and acquisitions allows access to new technologies, talent, and markets.
Global expansion strategies enable them to tap into emerging markets, while vertical integration lets them provide end-to-end cybersecurity solutions tailored to specific industries or organizations. Cloud-based services align with the trend of increased cloud adoption, and customization ensures solutions meet unique security requirements.
Market players also focus on customer education, compliance adherence, and cybersecurity awareness initiatives to build trust and stimulate demand. They prioritize quality customer support, threat intelligence sharing, and staying compliant with industry-specific regulations. These multifaceted strategies empower them to address evolving cybersecurity challenges and maintain a competitive edge in this dynamic market.
Applied AI in Cybersecurity Market - Key Companies Include
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APPLIED AI COMPANY (AAICO)
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Cisco
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Cybereason
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Fortinet
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Infosys
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Microsoft Corporation
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Palo Alto Networks
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Tessian
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Vectra AI
Applied AI in Cybersecurity Market - Market Segmentation
Applied AI in Cybersecurity Market - Organization Size Outlook
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SMEs
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Large Enterprise
Applied AI in Cybersecurity Market - Deployment Type Outlook
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On Premises
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Cloud
Applied AI in Cybersecurity Market - Security Type Outlook
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Network Security
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Endpoint Security
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Application Security
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Cloud Security
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ICS Security
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IoT Security
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Others
Applied AI in Cybersecurity Market - Application Outlook
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Identity and Access Management
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Risk and Compliance Management
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Data Loss Prevention
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Unified Threat Management
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Security and Vulnerability Management
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Antivirus/Antimalware
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Fraud Detection/Anti-Fraud
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Intrusion Detection/Prevention System
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Threat Intelligence
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Others
Applied AI in Cybersecurity Market - End User Outlook
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BFSI
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Retail
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Government & Defense
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Manufacturing
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Utilities
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Oil & Gas
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Healthcare
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Automotive & Transportation
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Other
Applied AI in Cybersecurity Market - Regional Outlook
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North America
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US
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Canada
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Mexico
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Europe
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Germany
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France
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UK
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Italy
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Spain
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Rest of Europe
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Asia-Pacific
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China
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Japan
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India
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South Korea
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Australia
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Rest of Asia-Pacific
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Middle East & Africa
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Saudi Arabia
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UAE
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South Africa
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Rest of the Middle East & Africa
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South America
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Brazil
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Argentina
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Chile
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Rest of South America
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