The answer to the question of “why is cybersecurity important?” might seem simple, but it’s one that many people are still asking. Here, INN provides a brief overview to the basics.
The answer to the question “Why is cybersecurity important?” might seem simple enough, considering the number of cyberthreats is growing in a big way. As a result, it’s no surprise that it’s an inquiry getting asked more frequently–making it key information that investors in the sector should be aware of.
For starters, a proliferation of cyberattacks is causing increasing damage to companies, governments and individuals. Take the Equifax (NYSE:EFX) attack that happened in July of 2017 as a significant example: the hack gained access to personal and financial information of almost 150 million people. Putting it simply, organizations need to respond to this increased threat by adopting strict cybersecurity measures.
In this article, the Investing News Network (INN) breaks down the three main answers to the question: “why is cybersecurity important?” Together, the expanding number of cyber attacks, the increasing severity of these assaults and the amount of money companies are spending on cyber security illustrate why it is such an important market.
Why is cybersecurity important? Increasing threats
As noted above, the number of cybersecurity attacks is increasing every year. From a total cost of $445 billion in 2014, the cost of cybercrimes reached $600 billion in 2017, according to a report by McAfee.
In a Cybersecurity Ventures report on cybercrimes, the firm projects the cost of cyberthreats to rise to $6 trillion annually by 2021, which includes everything from damage and destruction of data, stolen money, lost productivity, theft of intellectual property, theft of personal and financial data, embezzlement, fraud, post-attack disruption to businesses, forensic investigation, restoration and deleted hacked data and systems, to name a few. What investors might not know is the rising threat of cyber attacks on mobile devices, as well as medical devices–which is expected to reach $65 billion by 2021.
On that note, in an interview with INN, Dr. Alissa Johnson–CSIO of Xerox and former Deputy CIO at the White House, said that in order to prevent cybersecurity attacks, it’s important to remember the basics.
“Security is not just the responsibility of the security team, but as we’re learning and realising–especially with all the spear phishing attacks–security is everyone’s responsibility,” she said.
Why is cybersecurity important? Severity of attacks
However, it isn’t just the number of cybersecurity attacks that is increasing. The degree of these attacks is on the rise as well. According to PwC’s report, these attacks are “becoming progressively destructive and target a broadening array of information and attack vectors.”
Politicians are at risk. Obama’s administration proposed a $19 billion budget for cybersecurity. Hillary Clinton’s private emails became front page news in the midst of her presidential campaign, underscoring the importance of a strong cybersecurity policy.
In late August of last year, eight out of 28 members of the National Infrastructure Advisory Council, who are oversee the country’s response to cyberthreats, resigned.
According to BNA, those that resigned said, the Trump administration had paid “insufficient attention to the growing threats to cybersecurity of critical systems.”
BNA had previously reported that the “Strengthening the Cybersecurity of Federal Networks and Critical Infrastructure” gives the heads of federal agencies responsibility for managing cyberthreats–which still holds true, although is slightly eerie now, given recent the recent events.
Since then, Trump has released a strategy document which addresses cybersecurity and calls for stronger defenses against cyberthreats. The Trump administration mentions Russia, claiming the country initiates global political interference.
Why is cybersecurity important? Future outlook
Looking ahead, PwC’s Global State of Information Security Survey 2018 states that “87 percent of global CEOs say they are investing in cybersecurity to build trust with customers.” As per this report, approximately two-thirds of GSISS respondents have appointed a chief privacy officer. As these statistics show, companies are no longer asking “why is cybersecurity important?” – they recognize that it’s an area worthy of commitment and taking preventative action against threats.
Struggle between increased needs and limited funding is however characteristic of the cybersecurity industry. Hopefully, more and more companies, government departments and organizations are recognizing the importance of cybersecurity, and are allocating funds accordingly.
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This is an updated version of an article originally published on the Investing News Network in 2015.
Securities Disclosure: I, Amanda Kay, hold no direct investment interest in any company mentioned in this article.