Research and Markets (http://www.researchandmarkets.com/reports/c33822) has announced the addition of China Telecom Operators Network Security Outsourcing Market 2005 to their offering.

Security Outsourcing Market Status

There are three development stages for the network security market: market introduction phase, inflated expectation stage and slope of enlightenment stage.

There are currently three types of security outsourcing companies: IT service based, network security product based and network hardware based companies.

There are six security outsourcing market development drivers: the network development, high labour cost, high training cost, high professional requirements, distributable security responsibilities and the promotion from standardization.

There are five security outsourcing market hindrances: potential data loss, the lack of relative laws, the lack of industrial standards, low customer satisfaction with the service quality and prices and the lack of security outsourcing labours.

Telecom Operators Security Outsourcing Market

The main security threats for the telecom operators are as follows:

Worm and virus which occur in all networks

Stopping service attacks to all networks

The intrusion into the service supportive networks and OA networks

The fatal system destructions caused by software and hardware equipment failures.

There are four main demand simulative: cost, risk, consolidation of equipment and security, technology and human resource.

There mainly three demand hindrances: security, the degree of the law maturity and market and telecom operator transform issues.

Telecom operators will maintain a prudent attitude towards security maintenance outsourcing services in the short term. The security outsourcing market will develop steadily. Along with the telecom operators transformation, some telecom operators (which regard services as their core strategy) will build up their own security maintenance departments by cooperating with security service providers. Other telecom operators will outsource their security maintenance to security service providers.

Telecom operators may not accept the security-outsourcing price initially. Therefore it is advised that telecom operators begin outsourcing on a small scale.

There are five main influential factors for the telecom operators choices on the security outsourcing service providers: Credit, Capability, Price, Experience and Scale and namely the CAPES rule.

Telecom operators expect the security outsourcing service to be flexible, cooperative and explicit work distribution. The telecom operators would like to cooperate with security service providers in the following aspects:

Security service providers provide security services for telecom operators

Security service providers provide security services for telecom operators clients. In this case, the telecom operators prefer to provide security services to the clients in their names and administrate the security service staff.

Security service providers conduct

training to telecom operator employees. These providers not only take part in the maintenance of the telecom operators but sometimes also provide security services for telecom operators clients.

Telecom operators expectations on the security services:

Monitor the major IP network traffic and detect abnormal traffic, worms and denying service attacks.

Establish developed intrusion detection and vulnerability scan systems to detect security problems promptly and build up emergency response systems.

Establish security monitoring platforms.

The telecom operators expect the security outsourcing services to undertake seven responsibilities: service scale, training, response speed, loss compensation, monitoring time, communication and duty of confidentiality.

Telecom operators expect security outsourcing service providers to maintain the security strategy improvement and equipment distribution right in the security outsourcing services.

The telecom operator security service outsourcing market scale will develop from RMB160 million in 2004, to RMB 600 million in 2008, with a compound annual growth rate (CAGR) of 38.9%.

Telecom operators most interested security outsourcing services are IDC computer rooms and major IT client systems security outsourcing. It is expected that the total revenue of these two markets will record RMB 280 million in 2008. Telecom operators believe that the small and medium enterprise (SME) market has considerable potential but will not develop dramatically in the next three years.

Security service providers should consider the following three issues when providing security services to the telecom operators:

Information asset

Security-related equipments and systems

Security monitoring platform systems