Making Cents of Cyber-Security

Cyber crime in the form of cyber attacks and data breaches is on the rise globally. With an already booming global market, investors can look to the cyber-security industry as a source of future growth.

Executive Summary

Making Cents of Cyber-Security image

Data breaches, corporate attacks, government responses and billions of dollars at stake. It might sound like the premise for a summer blockbuster, but it's actually one downside of the continued expansion and integration of the digital realm. Cyber crime – including both cyber attacks1 and data breaches2 – is currently ranked as one of the top global risks by the World Economic Forum and promises to become an even greater concern going forward.3

Among U.S. companies, 91% have been hit by a cyber threat in the past year, a reflection of the estimated 118,000 attempted attacks per day made in 2014, according to Price Waterhouse Coopers.4 These events have become evident from recent daily news headlines. Last year there were numerous large-scale corporate data security breaches among top firms across various industries including Anthem (health care), Sony Pictures (entertainment), eBay (technology), JP Morgan Chase (banking) and Home Depot (retail).

Cyber crime in the form of cyber attacks and data breaches is on the rise globally, and the costs to companies of attacks and investment in cyber-security are large and expected to grow. With this growing threat, the cyber-security industry may be a source of future growth for investors.

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1 A cyber attack as defined by the Ponemon Institute 2014 Cost of Cyber Crime Study is criminal activity conducted via the Internet which can include stealing an organizations's intellectual property, confiscating online bank accounts, creating and distributing viruses on other computers, posting confidential business information on the Internet, and disrupting a country's critical national infrastructure.

2 A data breach as defined by the Ponemon Institute 2015 Cost of Data Breach Study is an event in which an individual's name plus a medical record and/or financial record or debit card is potentially put at risk – either in electronic or paper format.

3 World Economic Forum. Global Risks 2015: 10th.

 

4 Price Waterhouse Coopers (PWC). Managing cyber risks in an interconnected world. September 2014.

 

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