“With the government recently finalizing the home network security guide for apartments, the new apartment home network security market will emerge in earnest in the first half of next year. We expect that this will help the stage of activity of existing network security businesses expand from the B2B field to B2C and bring the ‘big bang effect’ to sales growth as well.”
CEO Gap-soo Joo of Axgate Said that, “According to the ‘Intelligent Home Network Equipment Installation and Technical Standards’ amended and announced at the end of last year, the separation of home networks between households has become mandatory, and virtual private network (VPN) technology have been chosen for application as a logical method of separating networks,” and welcomed the emergence of new demand for home network security. Starting next year, it is projected that the size of the new apartment home network security market will reach over 200 billion KRW annually and that the whole network security market will find a stem for new growth.
Axgate was confident that they would secure leadership of the apartment home network security market with the passage of a set period of time. This is because they already have expertise in network separation technology recommended in the security guide, such as IPSec (Internet Protocol Security) VPN and SSL (Secure Sockets Layer) VPN, and are already recognized for their safety and credibility, to the point of having the largest share of the private VPN market.
CEO Joo said that, “Instead of developing additional new products to enter the home network security market, we are equipping separate dedicated hardware with source technology and know-how with over 10 years of servicing experience, making the barrier for entry into the market very low.” This means the resources that need to be invested are drastically lower compared to the sales effect expected from the new market.
The company already prepared ‘Axgate HQ (tentative name)’, a VPN for apartment home network security, and have already gone into marketing to clients in home constructors. In particular, the company equipped ‘Axgate HQ’ with Quantum Crypto Chips (QCC) which blocks hacking from the source, giving it powerful security capabilities. Axgate signed a business agreement with quantum random number generator companies for the joint development of firewall authentication systems and VPN utilizing quantum random number security and authentication technology, last January.
CEO Joo has predicted that the success of the apartment home network security VPN business will be decided by quality and price. This is because home network security equipment for network separation acts as a burden for price hikes from the perspective of construction companies and occupants of apartments.
He said that, “Being able to meet the requirements of network separation while supplying equipment at an affordable cost will be the key point in the competition for leadership,” and explained that, “Starting from the designing phase of apartment home network VPN equipment, we focused on embedded OS and developed it to be in a small form to reduce burdens of cost for clients compared to our competitors.” He added that the element of CC certification for from the NIS for company VPN is Axgate’s advantage in differentiating their marketing for sales of newly built apartments.
Axgate predicted that next year, their home network security VPN, in addition to their new product of a next-generation firewall, will become the two wings that pull the growth of sales in the future. With private server communication changing to HTTPS encrypted communication 3 years ago, they began to focus their targeting in gaps left by Korean and foreign companies that faced setbacks in their plans to target the next generation firewall market.
CEO Joo said that, “With already released next-generation firewalls from earlier companies facing limitations in controlling and recognizing applications from the emergence of HTTPS, they are developing additional decryption technology to deal with this issue,” and went on to say, “On the other hand, Axgate first released decryption products and began the work of combining next-generation firewalls and decryption solutions 2 years ago. We are now in a situation of having the same time to market as our competitors who had a head start.” As a result of preparing in accordance with their internal technology development roadmap, they are now in the same starting place as their global competitors to target the next-generation firewall market.
With their listing in the 1st quarter of next year, Axgate plans to actively invest in building a lineup of network security products, attracting an excellent workforce, and advancing customer support management systems. The company is looking into expansion into overseas markets through security module support and technical cooperation with Korean companies that have expanded overseas into places like Japan or the US years ago. The strategy is to make good use of know-how from companies that have succeeded in expanding overseas, instead of expanding on their own.
CEO Joo said that, “We will complete our total network security lineup by expanding into the markets progressively with things like next-generation firewalls, IPS, and DDos, actively invest in attracting manpower, and focus on strengthening the company’s basic capabilities to create a sustainable company structure,” and said that, “If we are well prepared in the aspects that Axgate is good at and are patient, I am sure that there will soon be a chance for us to make a quantum leap forward.”
Reporter Su-min Ahn (smahn@etnews.com)