Strategy & Vision

Market overview

The growing number and variety of connected devices as well as digital services continues to create security challenges for both businesses and individuals. Combined with the increasing complexity of IT systems, these trends are driving demand for security services. While advanced cyber attacks are becoming more common and persistent, criminals are targeting companies of all sizes along with consumers by taking advantage of vulnerabilities in popular software, traditional and new connected devices as well as online services. Apart from pure criminal activity, governments and hacktivists are abusing vulnerabilities and malware e.g. for espionage and surveillance.

Attacks against corporations often go undetected for months, which fuels demand for incident detection and response products and services, supplementing the endpoint security market. Furthermore, as organizations are increasingly adopting cloud services, they seek managed security services and cloud-based delivery to help them maintain control of their security. In the long run, this trend is expected to shift investment away from on-premise security products, while new opportunities arise in securing the cloud platforms. Larger organizations also remain interested in securing their mobile device fleets.

The consumer security software market continues to be impacted by the changing device landscape, as well as the increasing significance of app stores and online sales overall. While the sales of traditional PC's have declined slightly, the number of connected smart home devices is growing rapidly. This creates opportunities for innovative new security products. There are also opportunities to capture market share from the competition with traditional security products.

The information security market overall was estimated to be worth USD 77.9 billion in 2015, and the market is expected to grow by 8.0% annually in 2015–20201. The endpoint security platforms (enterprise) market was worth USD 3.2 billion in 2015, and is expected to grow by 2.8% annually in 2015–20201. The consumer security software market was worth USD 4.6 billion in 2015, and is expected to grow by 1.7% annually in 2015–20201. The IT outsourcing market, including managed security services, was worth USD 14.1 billion in 2015, and is estimated to grow by 12.1% annually in 2015–20201.

Sources: 1) Gartner, Forecast Information Security, Worldwide, 2014–2020, 2Q16, Ruggero Contu, Christian Canales, Sid Deshpande, Lawrence Pingree, 25 August 2016. Market size quoted in current dollars, growth rates in constant dollars.

The Gartner Report(s) described herein, (the "Gartner Report(s)") represent(s) research opinion or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. ("Gartner"), and are not representations of fact. Each Gartner Report speaks as of its original publication date (and not as of the date of this Interim Report) and the opinions expressed in the Gartner Report(s) are subject to change without notice.

Strategy 2016–18

F-Secure aims to capitalize on the next phase of the internet and connected world. The Company's strategy reflects the fast growing number of internet-connected devices, the changes in the ways business is done amid increasing digitalization, and the concurrent increase in cybercrime. Execution of the strategy will further speed up F-Secure's transformation from an end-point antivirus company to a broader provider of cyber security products and services.

The key driver behind the strategy is F-Secure's aspiration for growth. F-Secure is continuing to increase its investments in the fastest growing markets within corporate security. These include managed endpoint security services sold through the reseller channel as well as the cyber security services business. Investments in consumer security are continued at a level that targets profitable growth.

F-Secure also aims to maximize the commercial impact of its technical expertise and multiple sales channels for further growth in its chosen key market segments. These include cyber security offerings to large enterprises in Northern Europe and in selected verticals comprising financial industry, gaming and gambling companies, aviation, defence, law enforcement, and certain global brands. In corporate security the focus is on the reseller channel in Europe and Japan. In consumer security, F-Secure continues with its existing sales channels through operators, e-commerce and retail partners.

To enable execution of the growth strategy, F-Secure is actively recruiting highly skilled security professionals, rising cyber security talents and capable sales personnel. The Company also aims at growing through M&A.

The overall key strategic target for F-Secure is to become the leading European cyber security company.