Jakarta Globe - AFP, John Biers, Mar 29, 2014
 |
| Investors are pumping millions of dollars into encryption as unease about data security drives a rising need for ways to keep unwanted eyes away from personal and corporate information. (AFP Photo/Thomas Samson) |
New York.
Investors are pumping millions of dollars into encryption as unease about data
security drives a rising need for ways to keep unwanted eyes away from personal
and corporate information.
Major data
breaches at Target and other retailers that have made data security a boardroom
issue at companies large and small.
And
stunning revelations of widespread snooping by US intelligence agencies have
also rattled companies and the public.
For venture
capital, that has opened up a new area of growth in the tech business.
In
February, Google Ventures led a $25.5 million round of venture funding for
Atlanta-based Ionic Security, a three-year old company that works in
encryption, which scrambles data before it is shipped or stored.
Other
encryption companies, including Toronto-based PerspecSys and San Jose,
California-based CipherCloud, have announced major fundings.
The funding
rush could hearken a “golden age” of encryption, as one expert puts it. But the
industry also faces barriers to a tool that until recently was not a hot
commodity.
Concerns
about encryption range from practical challenges, such as the difficulty users
have to search their encoded data, to government opposition towards encryption.
“People are
afraid of it because they don’t understand it,” John Kindervag, a vice
president and principal analyst at Forrester Research But he called the wider
use of encryption “inevitable, because there’s no other way to solve the
problem.”
Kindervag
said the industry is between one and two years away from “some big revolutions”
in the field. “It just needs to happen.”
But Venky
Ganesan, a managing director with venture capital firm Menlo Ventures, believes
major advances are further off.
“Encryption
slows down,” Ganesan said. “Just imagine if every room in your house was locked
and you had to open and close it every time you go in. You would be
frustrated.”
Another
problem is “the government is sensitive,” said Ganesan.
“They don’t
want encryption technology to be open so that anybody can use it, because their
goal is to make sure they can always get access to the information.”
He said
governments have frequently insisted that they be given a master key to decrypt
files, Ganesan said.
Snowden
seal of approval
The need
for better encryption vaulted to the top of the tech industry’s agenda earlier
this month by fugitive intelligence contractor Edward Snowden, who last year
exposed the massive spying capabilities of the US National Security Agency.
Snowden
urged industry leaders to make a “moral commitment” to safeguard customer data
by integrating encryption into devices in a user-friendly way.
The NSA and
foreign intelligence services are “setting fire to the future of the Internet,”
Snowden said via video from Russia. “You guys are the firefighters and we need
you to help fix things.”
Recent data
security scandals underscore the new vulnerabilities as organizations process
unprecedented amounts of data that are analyzed, shipped, stored in “the cloud”
— offsite commercial servers — and accessed remotely by mobile technology.
It’s a far
cry from the days when security focused on safeguarding a stolen laptop.
“It’s on
every corporation’s and every government’s mind how they protect their data and
their intellectual property,” said William Bowmer, a technology stock
specialist at Barclays.
Wall Street
appears ready to commit more money to security companies as well. Shares of
FireEye, which reportedly alerted Target to breaches in its security network
even though the company did not take action, have more than tripled from the
September 2013 IPO price of $20.
Industry
insiders see some encryption firms as possibilities for entering the market:
Voltage Security, SafeNet, Protegrity and Vormetric Data Security.
Voltage
chief executive Sathvik Krishnamurthy described the market for encryption as
“thriving and growing” and said the perception of government opposition to
encryption is outdated.
Encryption
can be integrated into policies that incorporate the lessons of the Snowden
revelations with the need to protect national security, Krishnamurthy said.
Spying by
authorities “has been going on forever,” he said.
“In any
society where you think you’ve had privacy, you’ve been grossly mistaken. It’s
just a question of the degree to which you were clueless about Big Brother
actually looking at everything you were doing.”
He called
the NSA’s sweep of data “really over the top.”
“Did we
have to spy on Angel Merkel’s emails? No.”
But the
biggest problem with the NSA program was the lack of disclosure, Krishnamurthy
said.
Disclosure
by the government of its program “will normalize the line over which we would
no longer cross,” he said. “If you have to answer for your actions, then you
are more likely to be reasonable in your actions.”
Agence France-Presse
No comments:
Post a Comment