1/13/2009 -- If you need a clue as to just how serious the economic situation actually is, take a look at the otherwise red-hot market for network access control (NAC) enforcement devices.

NAC has been a sizzling segment since Cisco Systems Inc. and other vendors first kicked things off six years ago, posting double-digit quarterly and annual growth rates. For the first time in a long time, however, the NAC market slowed in the third quarter of 2008, growing at a 9 percent clip. Healthy, yes. But still a far cry from the double-digit growth that has been the status quo in that market for nearly three years.

The upshot, reported market watcher Infonetics Research, is that while the security space as a whole has been largely insulated from (or at least resistant to) the effects of the ongoing economic crisis, the NAC market, paradoxically, has been directly affected. This isn't as paradoxical as it might seem, however: According to Infonetics, the carnage in the financial services sector -- which has been a prime NAC adopter -- is most to blame for the slowdown in NAC uptake.

"The government, health care and education sectors have been solid early adopters of NAC technology, and vendors tell us these verticals have not curbed their NAC purchases or plans due to the economic slowdown," said Jeff Wilson, principal analyst for network security at Infonetics Research. "Many NAC vendors found early success selling into the heavily regulated financial services market as well, which has all but imploded, of course, which will have a significant impact on the NAC market. The retail sector is being hit hard, too, forcing many retailers to postpone NAC investments. This effect will be temporary, though, as many financial firms invest in NAC for compliance purposes and will need to continue investing once their larger business issues are sorted out."

There are some bright spots. In-line NAC appliance sales did post double-digit growth, surging 14 percent year-over-year in Q3. Elsewhere, switch-based NAC solutions account for "a small but fast-growing portion of the market," according to Infonetics.

There's another looming bright spot: "The primary drivers for security spending, which will sustain the NAC market through the economic downturn, include regulation and compliance, security investment as a cost-saving measure, service provider spending on security, and the explosive growth in the number, variety and volume of security threats," Infonetics wrote.

On the other hand, North America -- where the U.S. has been battered by economic shocks -- currently accounts for more than half of all NAC enforcement appliance sales. That could augur even slower growth in the months ahead. --Stephen Swoyer