Forecast: SEM Industry To Reach $430 Million By 2008

The report, "Security Event Management Systems Defend Against Information and Regulatory Overload," said that as security becomes a greater concern for network administrators, SEM systems that enable them to identify, manage and respond to virus and hacker threats are becoming more prevalent.

The $90 million SEM market also could witness as much as 50 percent market consolidation in 2004, said report author Phebe Waterfield.

"Integrating a systems management solution with risk management has the potential to revolutionize the way enterprises manage security risks," Waterfield added. "[There is] an increasing opportunity for overlapping network and systems management vendors to add value by integrating with a new breed of security solutions."

SEM systems burst onto the scene in the late 1990s, when security vendors created them to help network administrators cope with information overload generated by security devices. Since then, as network security has become more of an issue, administrators have signed up in record numbers.

Waterfield's report indicates that there are now 19 major vendors on the market, including smaller players such as Addamark Technologies, netForensics, e-Security, Intellitactics, and Micromuse, as well as larger firms such as Computer Associates, IBM Tivoli, and Symantec.

Many of these companies currently have channel programs in the SEM space, and Waterfield hinted that these programs would grow as the industry does. She added that partnerships between SEM vendors and smaller security-focused managed service providers may also help SEM channel sales evolve over the next five years.