Cybercrime is one of the fastest-growing criminal activities on the planet. It covers a huge range of illegal activity such as financial scams, personal or corporate data theft, virus attacks, even espionage and the disruption to national energy or industrial systems.
Computer hacking might have started out as little more than an intellectual game of programming chess played between a small collection of geeks and big business or government departments, but given the extent to which computers have become a part of modern life, it was inevitable that some people would see the wired world as an opportunity to make money, cause mischief or push their own private or political agendas. The explosion of mobile devices is only escalating the threat of cyber attacks.
According to statistics put together by data research group Wireless Intelligence, last year there were nearly two billion internet users worldwide, and over five billion mobile phone connections, producing an estimated 294 billion emails and five billion text messages daily. But as Mark Skertic, Chicago office director of business intelligence consultancy Kroll, points out, 'the Internet is the largest public forum ever created, a virtual arena for the conduct of commerce and the exchange of information and ideas,' yet 'companies have learned that it is also a place where hidden foes can carry out virulent attacks.'
Of course, ID theft is a serious threat to us all, but that aside, other than online banking (which I only use from my home computer, never my mobile) I haven't got much cyber stuff worth nicking. Frankly, so what if Big Brother (or the US government via Prism) wants to take a peak at my holiday snaps on Facebook (FB:NASDAQ). I suppose even NSA agents go on holiday and they might get something from my pics of Volcan Pacaya, in Guatemala, or my Scuba diving shots of Nemo in Thailand.
Apple (AAPL:NDQ), for example, will have the list of websites and searches you’ve ever accessed from the privacy of your iPhone or iPad, which might prove a little embarrassing for some, but as finnCap's Andrew Darley recently pointed out, 'the challenge of hackers sifting through all the potential consumer bank accounts which can be hacked from misplaced personal devices is that most people are financially uninteresting and would instantly notice the disappearance of thousands of pounds.' The Metro newspaper last week reported that 40% of Brits now look for suspicious transactions as opposed to spotting them by chance.
But it's a different kettle of fish for businesses that are increasingly embracing the BYOD (Bring Your Own Device) shift, where every device is a potential IT security breach point. The DEFCON and Black Hat conferences ran back-to-back in Las Vegas last week and some of the tips from those shows were fairly obvious; make sure you have all of the latest software updates and patches, don’t leave your device alone, don’t use untrusted USB sticks, etc. But others reveal the scarier side of the Black Hat dark arts (Black Hats are basically malicious hackers, White Hats their ethical counterparts). These include switching off all Wifi and Bluetooth; deleting browser and cookie histories; not using communal chargers; removing RFID (Radio Frequency Identity) enabled devices, including work passes, passports and credit cards.
Shares last year spelled out many of the big themes around cyber security in our 'Profit from the cyber wars' feature (page 26 of PDF), and it's clear that not only is this an arms race between hackers and security prevention and protection specialists, it's an escalating one too, bringing to mind that Ralph Waldo Emerson remark, that if you 'build a better mousetrap,' mother nature will 'build a better mouse.' Of course, adversity breeds opportunity, to use another well-used line, and the clear long-run growth trend in cyber security prevention and protection throws up plenty.
Big overseas firms dominate the market, players such as Symantec (SYMC:NDQ) or McAfee, now owned by Intel (INTQ:NDQ), in the US, while Russia's Kaspersky Labs is another heavy-hitter in the cyber sec space. But there are also an increasing number of UK-based specialists offering investors attractive growth and profits potential across this rapidly changing, and growing niche market, such as Manchester-based NCC (NCC), a company we have written about many times and at least twice this year (see Tech Titans, 7 Feb and Plays, 14 Feb). Other small specialist in the space include Accumuli (ACM:AIM), Corero Network Security (CNS:AIM), GB Group (GBG:AIM) and Intercede (IGP:AIM), between them supplying businesses specialist or fully managed services aimed at securing communication networks, protecting identity data, safe-guarding financial payments and IT system testing. I suspect I, and Shares, will be returning to this cyber sec hot topic in the near future.