Major data security companies like Juniper and Cisco are struggling to keep up with their smaller competitors in the battle against cyber crime, Jayson Noland, a senior analyst for Robert W. Baird, said on CNBC's "Squawk on the Street."
"The smaller more innovative companies are doing quite well here," Noland said Tuesday. "The bigger companies in the space are having difficulty keeping up with the pace of change."
Technology security has to evolve as cyber criminals' methods of attacking evolves, and it is often hard for larger companies to adapt to new cyber threats, he said.
Publicly traded security firms Palo Alto Networks and Fortinet , along with smaller private security companies like FireEye or Barracuda Networks, are beating their larger competitors in the security space because they are able to quickly innovate as new threats arise, Noland said.
"These (cyber criminals) are well financed, sophisticated groups of people after all kinds of information. They could be profit-minded criminals, it could be social activists, it could be terrorists of some type," Noland said. "The rapid amount of change in the industry is causing the smaller companies with new ideas and less bureaucracy to flourish."