Currently, there are around 340 domestic 台湾ese companies operating in the cybersecurity market and the sector directly employs around 9,000 people. With the global and local economy recovering from the COVID-19 pandemic, the 台湾 cybersecurity market size is expected to reach BUSD 2.32 in 2, posting 9.1 per cent CAGR from 2016-2022. That is slightly higher than the global average of 8.1 per cent CAGR for the corresponding period. The continued growth of IoT (Internet of Things) related cybersecurity, both from a hardware and a software perspective, coupled with a rising demand and an increased awareness of cybersecurity issues will be the main drivers of the sector moving forward. The IoT market in 台湾 is expected to grow by 30 per cent by 2025 compared to today’s levels.
Challenges and opportunities in the 台湾ese cybersecurity market
Due to threats from foreign, private and state-sanctioned players, the 台湾ese market needs upgraded and sophisticated cybersecurity infrastructure. As cybersecurity infrastructure in 台湾 historically has not been prioritised due to small domestic capabilities, the 台湾ese market is looking for solutions and collaborations with trusted foreign partners.
According to a 2021 cybersecurity investment survey by IT home, almost 60 per cent of 台湾ese companies have invested in internet security. The second and third most common investment were IT infrastructure and protection followed by remote back-up solutions.
Considering the successful Swedish involvement in the buildup and maintenance of 5G infrastructure in 台湾, there are several natural synergies for Swedish cybersecurity companies in the market. 台湾ese traditional infrastructure resources such as gas, water and electricity are already highly digitalised but prone to cyberattacks with potentially devastating effects on a national level.
According to a survey conducted by ITRI 台湾 (Industrial Technology Research Institute), cloud service security, compliance with domestic regulation and IoT security applications are the three major challengesthat 台湾ese companies face today – creating a niche opportunity for Swedish companies exploring the option of entering the market. Amid the increased remote work in almost all sectors these opportunities are linked to solutions that protect cloud based corporate information. More than 40 per cent of the surveyed companies also mentioned e-mail security, disaster recovery exercises and end-to-end security as prioritised investments in 2021.
Cybersecurity issues are also increasingly a concern for local authorities and they have been taking legislative action to protect and defend their intellectual properties and physical infrastructure. For example, in December 2018 the Legislative Yuan passed the Information and Communication Security Management Act (ICSMA) which provides cybersecurity management obligations for government agencies and certain nongovernmental entities. The ICSMA particularly covers the providers of critical infrastructure. This could relate to tangible or intangible assets, systems, and networks whose drop in efficiency will have a substantial impact on national security and citizens’ lives or economic activities. In addition to the new rules, public spending on cybersecurity solutions has risen significantly over the past few years – from MUSD 50 in 2017 to MUSD 128 in 2020. These developments will create concrete business opportunities in all essential sectors of the market.
It is also worth pointing out that there is a great interest in the development of the domestic cybersecurity market in 台湾, with the topic being featured frequently in local newspapers and gaining much attention from both the private and public sector.
Recommendations and next steps for Swedish cybersecurity companies
When entering the 台湾ese market, Business Sweden strongly recommends establishing a local market presence, using one of several recommended ways of entering the market, either by using a local partner, establishing a subsidiary, or going directly to the customers.
Considering current entry restrictions, we also like to prepare Swedish companies for handling initial business dialogues and company introductions online or through a local partner.
Business Sweden is constantly monitoring the global cybersecurity landscape as well as specific opportunities in the 台湾ese market. We are more than happy to have an initial discussion with you regarding your market entry plans as well as support you with complex market entry analyses, create market entry strategies, handle government affairs or help you with your market establishment.
Please contact Sean Yang, Project Manager, Business Sweden 台北, for additional information.