The enterprise security market has seen substantial growth to become an estimated $213 billion market over the last five years. The future will require a shift to more real-time and artificial intelligence (AI)-driven security delivered by platforms, noted Nikesh Arora, Palo Alto Networks chairman and CEO, during the vendor’s latest earnings call.

“What we think lies ahead is the need for security to stop bad actors midflight, real time, as it's happening,” Arora said in his forward-looking statements, adding that the current average industry rate is around 30% or 40% in real-time actions. “What we still aren't good at as an industry is being able to figure out unknowns and stop them before they happen.”

To address this issue and the ever-changing threat landscape, it requires a fundamental change of security mindset. This shift should be toward real-time and autonomous analytics, Arora argues.

AI is the key technology that enables real-time analysis of massive amounts of data for superior security solutions. Meanwhile, the solution also needs ubiquitous platformization. Security vendors should stitch their disparate solutions together to create a more comprehensive security platform.

“It will no longer be about putting a bunch of sensors and thinking about hygiene and security policies,” Arora said. “Today, the mean time to fix a bad act as we've talked to you about in our earnings is four to six days. That's not acceptable. This thing will have to go down to minutes and near real time.”

“If you look at it, the biggest opportunity is that big green circle of security operations and automation because we think the current paradigm is broken,” he added.

Hiring 3 million more security professionals won’t solve the security problems, Arora argues. And the paradigm shift is underway from reactive to proactive and autonomous security solutions.

The security giant is gunning to address the more than $200 billion in security market opportunities.

From 2018 to 2023, the security total addressable/available market (TAM) has continued to rise at approximately 14% compound annual growth rate (CAGR), which is twice the rate of the IT market in general, Arora pointed out.

This ongoing growth is driven mainly by three trends:

1. New segments have been created, including secure access service edge (SASE), cloud security and internet of things (IoT) security. This represents a nearly $29 billion market and 35% TAM CAGR, according to Palo Alto Networks. Arora noted that in the past five years, SASE has gone mainstream, secured-by-design has become a key to cloud security, and the arrival of IoT and operational technology (OT) have brought more opportunities.
2. Segments like endpoint security/extended detection and response (XDR), SecOps and network security are undergoing transformation. This $72 billion market comes with a 19% TAM CAGR. With the shift from endpoint detection and response (EDR) to XDR, the XDR market has exploded into about 14 vendors, but Arora expects to see clear leaders down to two or three players in this space.
3. Large segments such as identity, application, data and email security have been steady. This is a $31 billion market with a 13% TAM CAGR.

Additionally, there is a $18 billion security services market that Arora expects to “continue to evolve in the next three to five years.”