IT spending went through the roof just before the millennium as companies upgraded their equipment to minimise possible disruption, and the threat of terrorist attack is now having a similar effect on spending in the IT security sector, according to research firm Forrester.

The emphasis on being prepared for a terrorist attack has resulted in security spending plans being given a higher priority. However, Forrester believes this is causing a shortage of specialist skills in the market and will drive more companies to choose an outsourced managed-security service.

Forrester expects that within five years, managed firewalls will make up 36 percent of the managed security market and account for 1.7bn euros in revenue. Managed intrusion-detection systems are predicted to grow at almost 50 percent a year, accounting for 32 percent of the market and generating 1.5bn euros (£1.05bn) in revenues by 2008. In the same time frame, the use of digital signatures is predicted to grow by more than 50 percent a year, resulting in a 1.1bn euro market.

[ Read more ]