General Electric Company Makes A Big Move Into Cybersecurity
It’s no secret that cybercrimes are on the rise – in fact, a study by McAfee (a computer security and antivirus company) revealed that cybercrime cost businesses around the globe more than $1 trillion in 2009 alone. It seems Internet pilfering has come of age, and the problem is getting harder to ignore. Even state-sponsored hackers are getting in on the action; for one, the Chinese.
On May 19, the U.S. Attorney General indicted five Chinese military members for stealing trade secrets from Alcoa Inc(NYSE:AA); TOSHIBA CORP(OTCMKTS:TOSBF) subsidiary Westinghouse; United States Steel Corporation(NYSE:X); SOLARWORLD AG NPV(OTCMKTS:SRWRF); Allegheny Technologies Incorporated(NYSE:ATI); and others.
Is it any surprise? Not especially, said FBI Counterintelligence Division Assistant Director Randall Coleman, in a statement before the Senate Judiciary Committee on May 13.
Citing a report by the U.S.-China Economic and Security Review Commission, Coleman said China “depends on industrial espionage, forced technology transfers, and piracy and counterfeiting of foreign technology as part of a system of innovation mercantilism.”
But there is a bright side to these raging cases of industrial espionage: Big companies are now shelling out big bucks for cyber protection.
GE Finds a Solution
The developer of everything from appliances to jet engines, General Electric Company(NYSE:GE), is leading the cybersecurity charge.
Last month, GE purchased Wurldtech, a Canadian company created to protect industrial machinery and infrastructure from cybercrimes.
While the purchase price has yet to be announced, the company hopes to protect its operations-technology networks (OT) from cyberattack with the new “Operational Technology security” provided by Wurldtech.
“The world of OT security needs to be foundationally different from traditional IT detection systems,” said GE Software executive Bill Ruh in a press release. “Securing connected machines has a unique set of complexities that are very different from protecting a datacenter.”
Why It Was a Smart Move
Aside from providing GE with the latest in cybersecurity protection, the purchase also poises GE to take advantage of the growing need for adept Internet security providers. The need is definitely there – the State Department disclosed that there had been 256 infrastructure-related cyber breaches and invasions in 2013 (151 of which dealt with the energy sector).
The industry is expected to grow by 50% through 2016, and will be worth $120.1 billion by 2017 as companies act to avoid embarrassing hacks like that of Target and Yahoo.
But it won’t be easy for GE – the global Internet security market is full of sharp elbows, with cutting-edge, big-name companies like FireEye Inc(NASDAQ:FEYE) and Cisco Systems, Inc.(NASDAQ:CSCO) that have seen stock gains from swallowing up innovative startups at the beginning of 2014.
But Can It Fit the Bill?
While big-industry interest in cybersecurity protection grows daily, it will take a