Can tech investments stop hackers?
The British government announced plans to invest $250 million into cybersecurity start-ups as a means to boost domestic intelligence and defenses against hackers.
“I know about the enormous potential for the Internet to drive economic growth,” said Chancellor George Osborne, a British parliamentary member. “I am also acutely aware of the risk of cyberattack harming our economy and undermining the confidence on which it rests.”
The move is the latest in a wave of investments among governments and corporations tightening security against cyberattacks. Banks, retailers, and hospitals are following suit, pouring money into already-existing firms.
As a result, cybersecurity companies are seeing a sharp uptick in funding, with more than $2.3 billion dumped into the sector already in 2015, Fortune reported. That figure is up from $1.7 billion in 2013 and is projected to rise to $108 billion by 2019.
JPMorgan Chase & Co. raised its cybersecurity budget to $500 million this year, twice that of 2014. The decision came after hackers stole information from 83 million families and business last year, Fortune reported.
The pressure to secure a digitized global system is being felt all the way to the top.
“One of the very few times a CEO is fired is when you are exposed to a security breach,” said Venky Ganesan, managing director at Menlo Ventures, told Fortune. “This will be the last thing cut on the budget because nobody wants to lose their job.”
But will these efforts make a difference against the ever-evolving capabilities of hostile governments and hackers?
Much of the decision to boost cybersecurity funding in Britain was centered on national security issues, said Chancellor Osborne, referencing last week’s attacks on Paris.
“This determination to confront threats against our country is at the heart of what you do here,” he said. “One of the ways you keep us safe is by tracking terrorist groups and collecting the information we need to stop those attacks.”
The United States has steadily increased cybersecurity spending, too. Congress has approved a 10 percent increase from $12.5 billion this year to $14 billion in 2016.
Yet hackers continue to make gains, this year infiltrating multiple branches of the US government including the White House and State Department. As a whole, the country saw 70,000 security breaches in 2014.
But there is evidence to suggest some cybersecurity improvements are working, and that economic threats may continue to drive innovation. Microsoft is credited with improving its cybersecurity record as it seeks to expand its Cloud products.
The company is using a combination of improved technologies and a change in tactics such as paying hackers to find security loopholes, all reinforced annually by roughly $1 billon cybersecurity budget.
The British government will use its most recent round of funding to centralize its cybersecurity intelligence and support small businesses.
“It’s to invest in start-ups that are working in areas that overlap with and are in line with what the government and intelligence agencies believe are important areas to strengthen,” a spokesperson told TechCrunch. “So when they see areas of overlap they will invest.”
