Mobile Hacking Leads to Boom for Some Companies
The recent list of hacking victims couldn't be more high-profile. Facebook, Apple, Twitter, the New York Times and even Burger King have been hit by cyber-attacks, leaving some of them red faced.
And the mobile industry is no different. With the explosion of mobile devices, operators are fighting back against the challenges of protecting a borderless network against attacks from different geographic locations.
But that's also creating plenty of growth for internet and mobile security firms.
JR Smith, CEO of AVG technologies, an anti-virus company listed on the New York Stock Exchange told CNBC.com that the company had made almost 14 acquisitions over the past six years.
"Right now we're looking predominantly in the mobile space at lots of different opportunities out there...and it is vast," Smith told CNBC.com at the Mobile World Congress in Barcelona.
The company will announce its latest acquisition in the next quarter, Smith said.
Mobile security firm Adaptive Mobile warned that hacking and malware attacks could get even worse because of the rollout of new 4G networks and the evolution of SMS messaging to a new format called RCS (rich communication suite).
"Without wishing to provide a cookbook for exploits, we would expect to see the following vectors become a testing ground for new threats over the next 18 months as RCS/LTE deployments and fixed-mobile interoperation become more widespread," the company said in a press release on Monday.
Adaptive Mobile said recent examples included spammers in Russia sending hundreds of text messages (SMS) with links to malware and a U.S. company billing subscribers unknowingly for a battery saving app downloaded from the Android store, now known as the Google Play store.
These mobile attacks haven't garnered the kind of attention other web attacks have.
In early February social media site Twitter confirmed that 250,000 user accounts had been compromised. Facebook announced it was hacked in a "sophisticated attack" two weeks later. The same hackers were believed to have targeted Apple soon afterwards, and the tech giant admitted that a small number of macs had been infected with malware.
Last week the fast-food chain Burger King had to suspend its Twitter account after hackers took control of the account and changed its profile picture to a McDonald's logo.
"As long as there is something to be gained it's going to exist," Siva Ananmalay, chief architect of service provider security at Juniper Networks told CNBC.com. Speaking at the Mobile World Congress in Barcelona he said the mobile industry will be the next big target, with valuable data, such as online banking, tempting potential hackers.
Juniper, listed on the Nasdaq stock exchange, has also been busy making acquisitions in the mobile space. According to Ananmalay the company uses acquisitions to complement its own internal research and development.
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"Most of the hacking already uses exploits that are known and can be fixed," Stephen Pritchard, a technology journalist told CNBC.com in Barcelona. His advice for operators and app makers was the "test, test and test again".
This claim was backed up by Omar Khawaja, head of product marketing in security solutions at Verizon. Speaking at a seminar at the Mobile World Congress he said that company data showed that 96 percent of all successful attacks, were not very difficult to achieve.
Verizon, which works with 15 different global law enforcement agencies, releases a data breach report every year detailing cyber-attacks. In its latest report, the company said the number of compromised records had skyrocketed to 174 million in 2011 after reaching an all-time low of four million in 2010.
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"If you're a big mobile operator then you probably should be spending a little bit more time than you do currently making sure that these apps are safe. Because their view of safe at the moment is essentially boils down to: 'does it disrupt the network?'," Pritchard said.
Security spending as a percentage of corporate IT budgets had increased, Pritchard said, although he conceded that a reduction in overall budgets may have contributed to this. The boom in anti-virus software is being driven by the boom in hacking, he said.
Security is expected to remain a priority through 2016, according to the latest forecasts from research firm Gartner. Worldwide spending on IT security was expected to rise to $60 billion in 2012 it said in a report, up 8.4 percent from $55 billion in 2011. Gartner expects this trajectory to continue and spending to reach $86 billion in 2016.
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"There's more valuable data out there and we're doing more valuable things on our phones and our laptops," Pritchard said, adding that firms that can convince consumers that their software does what it says, stand to make money.
Other than AVG technologies, Pritchard said that Russian firm Kaspersky and U.K.'s Sophos could be strong players in the sector.
"I think that there is a whole market of places in the world where people don't want to buy American technology in this area," he said.