German Enterprises Boost AI-Powered Cybersecurity Amid Rising Threats and Regulations

German enterprises are increasingly adopting AI-powered cybersecurity solutions to combat advanced threats and meet stringent regulatory requirements, according to the 2025 ISG Provider Lens® Cybersecurity — Services and Solutions report for Germany. As cyberattacks grow more sophisticated and geopolitical tensions persist—particularly due to the ongoing war in Ukraine—companies are turning to external providers for specialized expertise and scalable security services. The report highlights a growing reliance on artificial intelligence and automation to strengthen defenses, especially amid a critical shortage of cybersecurity professionals. With rising digitalization and evolving threats, organizations are investing in zero trust architectures, next-generation security operations centers (SOCs), and extended detection and response (XDR) platforms to enhance resilience. Regulatory pressures are a major driver. The European Union’s General Data Protection Regulation (GDPR) continues to shape data protection practices, while the upcoming national implementation of the NIS2 Directive in 2025 will impose stricter cybersecurity standards across critical sectors. These developments are pushing companies—especially small and midsize enterprises (SMEs)—to upgrade their security infrastructure despite often limited IT resources. SMEs are increasingly partnering with service providers to access tailored, cost-effective solutions that align with their operational realities. Providers are responding by refining product offerings, pricing models, and communication strategies to better serve this segment. German firms are also preparing for future threats, including those enabled by quantum computing. To counter this, companies are engaging specialized consultants for advanced encryption strategies and post-quantum cryptography. Demand for these services is expanding beyond traditional sectors like banking and insurance into manufacturing, healthcare, and public services. Data loss prevention (DLP) is another key focus area. As remote and hybrid work models grow, employees increasingly use personal devices for work, increasing the risk of data leaks. AI-driven DLP solutions are now widely adopted to monitor, detect, and prevent unauthorized data transfers, helping organizations comply with regulations and protect intellectual property. The report identifies several key technology trends influencing the German market: identity and access management (IAM), security service edge (SSE), and XDR. These technologies are central to modern security strategies, enabling better visibility, faster response times, and tighter control over digital assets. In its evaluation of 117 providers across eight quadrants, ISG named IBM a Leader in six categories, including Identity and Access Management and Next-Gen SOC/MDR Services. Axians, Controlware, and Deutsche Telekom each earned Leader status in four quadrants. Accenture, Atos, Bechtle, Broadcom, CANCOM, Capgemini, HCLTech, and Microsoft were recognized in three quadrants each. Additional leaders include Computacenter, Forcepoint, Fortinet, Palo Alto Networks, and Trellix, each leading in two areas. Several companies were named Rising Stars—firms with strong potential and promising portfolios—including BeyondTrust, HPE (Aruba), indevis, InfoGuard, ManageEngine, Materna, Sophos, and SVA. PwC was named the global ISG CX Star Performer for 2025, based on the highest customer satisfaction scores in ISG’s Voice of the Customer survey, part of the ISG Star of Excellence™ program. Customized versions of the report are available from Atos, Axians, Capgemini, Computacenter, Controlware GmbH, Deutsche Telekom, DriveLock, and suresecure. The full report is accessible to subscribers or for individual purchase on the ISG website.