Much of the tech news I've read lately has either been about cloud computing or hackers. Apple, Google and Amazon have their competing cloud services; PBS, Lockheed Martin, and Sony have all been hacked. Understandably, concerns are growing about not just security, but also what increasing breaches mean for cloud security. For investors, it means that companies working to improve cloud security are worth taking a look at.
How bad is it really?
Trend Micro, a leader in cloud security, estimates that 43% of cloud users experienced some sort of security breach within the past 12 months. That's a startling number, considering what sorts of information people entrust to the cloud. On top of that, Trend Micro expects five times as many cloud applications to come online in the next few years. This trend could turn the cloud into a hacker's fluffy dreamland if security measures don't start ramping up right now.
Who's going to keep the cloud safe?
In an effort to combat fears of hackers in the cloud, companies such as Akamai Technologies (Nasdaq: AKAM ) are stepping up. Akamai stresses the importance of moving away from older security devices such as network firewalls and developing security systems within the cloud. It estimates that in a single three-day episode last December, its cloud monitoring tactics saved retailers $15 million. Akamai counts Netflix and Apple among its customers.
IBM (NYSE: IBM ) is another company working to build security within the cloud. It's updating software platforms that it already operates to enhance them for cloud computing, including its Tivoli management system, which will be retooled and released later this year. Going forward, cloud security research will be geared toward correlating identity with network activity, monitoring and analyzing the relationship in real time.
Meanwhile, IBM and similar companies are building security into cloud software, while Intel (Nasdaq: INTC ) is building security into hardware. Intel professes that a combination of hardware and software security measures will ultimately end up securing the cloud for businesses and individual consumers. This belief in the future of security led Intel to scoop up McAfee at a price tag of nearly $7.7 billion. It's been working with giants such as IBM, Cisco, and Hewlett-Packard on cross-industry cloud-security measures. It has also devoted millions of dollars to collaborate with universities for security research in the cloud, among other related endeavors.
Sweet dreams for investors
All signs for the future point to the cloud. More and more information is going to migrate out of filing cabinets and into the ether, which means more and more emphasis must be placed on security. The companies I've mentioned aren't an exhaustive list of those embracing cloud security -- larger names such as Symantec (Nasdaq: SYMC ) and Check Point Software (Nasdaq: CHKP ) offer better pure plays into cloud security spending, and even they are just a few examples of businesses putting themselves in an excellent position for growth that can translate into great investments.
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