Demand for tighter Web security opens SSL acceleration product market
As more Web sessions need to be terminated and more data encrypted, server performance can grind to a halt. This processor-intensive need for encryption and decryption created the need for specialized devices to accelerate Secure Socket Layer (SSL) traffic. SSL is used to provide secure transaction processing for Web-based applications and for access to Web-based content. SSL is the familiar padlock icon that is active during secure Web sessions. Specialized SSL acceleration products include server peripheral cards, multipurpose devices that handle a variety of traffic-management functions and dedicated SSL acceleration appliances. The market for these products is growing as the demand for tighter security increases for Internet services.
Market research firm Infonetics Research found that businesses are using SSL technology for encrypted content on their intranets and e-commerce and SSL-based remote-access VPNs. Hosting service providers are deploying SSL technology for clients that outsource e-commerce and secure e-mail. Last April, Infonetics Research published User Plans for E-Business Infrastructure and Hosting, U.S./Canada 2002, which examined 240 small, midsize and large organizations that plan to build their own data centers or purchase e-business hosting services from service providers by January 2004 (27 percent do both). Use of SSL acceleration among respondents who will build their own e-business infrastructure will grow to 19 percent by 2004, when 29 percent of the large organizations are planning or considering it.
Why Organizations Deploy SSL Acceleration
Respondents estimate that, on average, 41 percent of their network traffic is encrypted via SSL now, rising to 49 percent in 2004. As more enterprise applications move to the Web, more and more intranets and extranets can be protected by SSL technology.
Accelerating SSL for remote access to Web-based portals resembles VPNs, but without the need for client software. Many SSL vendors are beginning to focus on SSL as an access technology and are developing application-layer VPN gateways. Application-layer VPN products attempt to solve deployability and management problems that many IPSec VPN users have already encountered; IPSec clients can be difficult, and many users don't actually need network-level access,they only need access to specific applications.
One of the keys to growth in the application-layer VPN space is how quickly end users will roll out Web-based applications. Vendors are working to support some network protocols natively (like FTP, file sharing, SMTP, etc.), but many users need access to business applications, not all of which have a Web front-end right now.
Hosting Service Providers
The past year has seen tremendous turmoil and consolidation among hosting service providers, yet there is continued customer demand for hosting services among businesses. Providers that survive the consolidation with increased focus and efficiency will be well-positioned to meet this steadily continuing demand. Surviving hosting service providers are following a model of success-based spending: Build as real customer needs dictate, not in expectation of future growth. This also applies to their deployment plans for SSL acceleration equipment.
In the August 2002 study The Hosting Service Provider Opportunity, U.S./Canada 2002, Infonetics Research interviewed respondents from 16 of approximately 50 major hosting service providers in the United States and Canada. Nearly two-thirds of these respondents have already bought specialized devices to terminate, accelerate or offload SSL traffic.
We asked the respondents who use SSL acceleration how many devices they had in 2002 and how many they'll have in 2003, and found the average number will grow 45 percent this year. Server- or host-based cards are the most common devices. They are also among the least expensive, and the savings in capital outlay make them tempting. The leading hosted applications these hosting providers offer and end users purchase make good use of SSL acceleration products.
SSL For the Future
The SSL market is still developing and will be sharply affected by form-factor decisions made by manufacturers, businesses and hosting service providers. By 2005, Infonetics projects that manufacturer revenue for dedicated SSL acceleration hardware and SSL VPN gateways will surpass $1 billion,a huge jump from 2002 revenue of just $98 million.
The combination of SSL for public use and corporate use will drive SSL into the infrastructure of organization and service-provider networks.