If 2019 has taught us anything about cybersecurity, it is that cyber-attacks are the reality of our times, hardware is still vulnerable and high-profile data leaks are becoming frighteningly more common.
The cybersecurity market is booming as recent data from MarketsandMarkets reveals that investments in cybersecurity can reach $250 billion by 2023 with spending already rising higher in 2019 than in any other industry sector.
The forces driving growth are increasingly strict measures and requirements on data protection imposed by the European Union and the growing threat of cyberterrorism. Cybercrime is forecasted to inflict damages of up to $6 trillion yearly by 2021, bellowing demand for security solutions both on the individual and corporate levels.
Growing threats mean growing demand
2019 has seen a number of IPOs in the cybersecurity industry as CrowdStrike, a California-based cybersecurity company, announced that was going public with an IPO, raised $700 million, and is valued at $6.8 billion.
The American Cloudflare web-infrastructure and website-security company, providing content-delivery-network services, also went through an IPO and added whopping 20% to its market price on the first day. And KnowBe4 announced that it received a staggering $300 million investment from private equity firm KKR. A number of other cybersecurity companies like Palo Alto Networks, Proofpoint, and Zscaler also enjoyed bullish rounds in stocks making the cybersecurity market attractive for investors.
“It’s evident that the B2B security industry is experiencing a renaissance. While the market is stronger than ever, there is a massive market cap shift from legacy security vendors like Splunk, McAfee, Symantec, and Check Point…to the new breed of leaders,” as stated by Jeb Miller, general partner at Icon Ventures.
Given that 90% of all data available online was generated over the last few years and the fact that cloud, mobile, API and other services are being increasingly integrated into the frameworks of corporations, the enticement of cybercriminals to tap into the wealth of information is simply irresistible. According to Juniper Research, overcall cybercrime costs have reached $2 trillion at the end of 2019 making companies increase their spendings on cybersecurity.
The growing demand for confidentiality caused by data leaks, as well as the needs of companies and organizations to comply with the new European General Data Protection Rules (GDPR), are attracting entrepreneurs and investors to next-generation solutions, including blockchain, artificial intelligence-based data management solutions, and advanced cryptography.
Cybersecurity as a Service
Cybersecurity as a service is part of the global trend towards the transition to the sharing economy model. In 2020, companies are not willing to overpay for tools, so they will be switching to using the required services for the period of time needed. The IT startups that started offering the given model have already become unicorns. Among such firms are McAfee Inc. and NortonLifeLock. Other alternative endpoint security providers include Carbon Black, Cylance, Palo Alto Networks, FireEye, and others.
New and promising providers are also emerging with viable solutions, such as Cloudstrike with its Falcon – the first Software-as-a-Service multi-tenant, cloud-native, intelligent security platform. A competitor – Infoblox – is offering security coupled with simplicity and automation via SD-WAN, hybrid cloud and IoT, reducing manual tasks by 70% and increasing productivity by 300%. Their BloxOne Threat Defense allows for traffic monitoring, proactive threat identification, network breach protection and automation. With 52% of the DDI market in their grasp, InfoBlox is the industry leader gripping 59% of Fortune 1000 companies and 58% of the Forbes 2000.
Blockchain
Routing all business and personal data through a centralized server with one main point of contact poses an overwhelming number of threats for information security. In 2019, $2 trillion was the cost of cyber-crime for businesses.
A new promising category to solve this problem is blockchain technology that makes data near impossible to change, with decentralized end-to-end encryption data services replacing traditional encryption tools. In 2020, we can see the projects that managed to offer decentralized data storage.
A new way to store data privately in a decentralized way was found by Jeff Pulver, the US VoIP entrepreneur behind $3 billion Vonage, an early Twitter investor. In 2018, he co-founded a new company to develop a blockchain-enabled communication network offering clients new authentication layers and decentralized solutions.
The solution, called Debrief, is said to be the most secure end-to-end business communication network that no longer exposes user confidential information unlike existing services like Facebook, Skype, and Zoom. As claimed by Pulver, with data encryption used in the network, information cannot be edited or tampered with in any type of way once it is placed onto the network. Each recipient on that network receives the same piece of information as it is inputted in real-time. In order for a hacker to tamper or edit the information on one recipient’s computer, the other computers on the network would have to accept this as edited information, which they would immediately reject.
“The data leaks that we witnessed in 2018-2019 had their causes and we believe that the best way of making high-security communications services universally available is through the use of blockchain technologies. By refraining from centralized control, we will be removing the weak link from the equation – the third parties,” Pulver explained.
Debrief consists of a decentralized storage system and secure blockchain authentication, making it impenetrable for hackers. The Debrief DApp, operating on the network to showcase its extensive functional capabilities, provides clients HD Video Conferencing, P2P audio and video calling, messaging, decentralized file storage, ensuring the confidentiality of all data. It’s also a middleware for other mainstream blockchains and traditional communication applications to utilize and enable blockchain communication features.
Demand for blockchain solutions capable of tracking vulnerabilities and suspicious transactions will continue to grow. Solutions like CipherTrace and Chainalysis, which managed to enter the market first, are now being used not only by large organizations, but also by government organizations, even the Interpol.
Employee training
The need for proper staff training will rise as cybercriminals become more devious. The new breed of employees will need to understand social engineering, phishing schemes, malware, ransomware and much else. Proper investments in people-oriented security systems will reduce losses.
AI and ML
Artificial Intelligence (AI) and Machine Learning (ML) are set to take the lead in security in 2020 as Richard Cassidy, senior director security strategy at Exabeam predicts,
“2020 should herald a truly golden age of ‘deep learning’, which will see a resurgence of artificial intelligence embedded into the fabric of our security frameworks. Expect to see some exciting machine learning developments in the seemingly ‘ad infinitum’ war on cyberthreats and bad actor group attack circuits.”
Cassidy’s words are backed by numbers. A Capgemini study shows that 69% of senior executives believe that AI and ML are inseparable from cybersecurity. An example is Kount’s Omniscore, which employs AI and ML to provide fraud analysts with necessary data for improving customer experiences and reducing fraud.
In 2020, the amount of ransomware attacks will increase, as it is easier for the attackers to find a security breach using new AI and machine learning technologies, since temporary data blocking is a quick way to make a buck. By 2022 , 50% of servers will encrypt all data, over 50% of security alerts will be handled by automatic AI-based mechanisms, and 150 million people will receive blockchain-based digital identifiers. New technologies, such as encryption, blockchain, machine learning and analytics will be used to improve security measures, as state-sponsored hackers and cybersecurity firms are both using artificial intelligence to get an edge.
SECURITI.ai is one company to watch out for as it enables enterprises to issue data rights and complies with global privacy regulations to improve the brand’s image. Another company is Tel Aviv-based Deep Instinct, which uses AI and deep learning to safeguard enterprise endpoints, both mobile and stationary. Deep Instinct is revolutionary in that it offers real-time cyberthreat identification and blocking.
Cloud
Cloud storage is on the rise as businesses shift their operations to cloud computing provided by the likes of Amazon Web Services. The company will be competing with mainstays like Fortinet, Palo Alto Networks and others as software-defined wide area networks (SD-WAN) technologies start taking over the cloud storage security frontier. But the giants have more competition coming up, as Netskope and Menlo Security are among the cloud security startups going public in 2020 that investors will be looking out for.
ID management
Identity management is another key area in the cybersecurity domain. Email and data-loss protection are being offered by a number of companies like Proofpoint, Okta, Qualys, Mimecast, Rapid7. Hackers know that targeting key employee or management emails is the easiest way of gaining access to corporate data management and storage systems.
Cyberark offers privileged accounts, Okta provides advanced identity management, while other companies are focusing on Zero Trust approaches. Cisco Systems, which recently acquired Duo Security for $2.35 billion, is fully vesting in the Zero Trust sector as it conducts full identity checks of all users and device health analysis before granting device access.
Gartner Research states that approximately 75% of all large companies will be employing selective access management systems by 2021, which is a 25% increase from their previous 2018 report. Forrester Research indicates that 80% of all security breaches are caused by compromised credentials. Among the most prominent victims of such attacks were Quest Diagnostics, Marriott International, Equifax, Yahoo Anthem, Target and others.
Tightening the rivets
Unlike generalized world-scale problems, digital threats pose a greater risk to the cornerstone of the global economy – data. As criminals are becoming ever more devious and sophisticated in their approaches to milking money from individuals and enterprises, the challenge is up to cybersecurity firms to step up and take on the mantle of viable solution providers.
2020 is set to become a make-or-break year in the cybersecurity industry as new approaches to handling threats are coming to the forefront. Whether it be AI, ML, blockchain, Zero Trust or any other technology, the aim is the same – safeguarding data and reducing economic damages that are so far showing signs of abating.
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