IDG Contributor Network: Brand reputation at risk

IDG Contributor Network: Brand reputation at risk

The world is going digital at an unprecedented pace. Established business models are reaching the end of their life cycle. New market entrants are disruptively entering the arena with asset-light balance sheets, build upon platforms and apps, which turn the dynamics of competition upside-down. Technology, media and entertainment, and telco (TMT) companies are at the forefront of this wave.

Although many TMT companies are leaders in digital transformation, they arguably more vulnerable to cyber-attacks than other industries, with the consequences of a breach more serious as highlighted in EY’s GISS 2018-19. Unlike the global panel, this excerpt focuses on consolidated findings from TMT companies.

Digitization may make TMT companies more operationally agile and streamlined, but it also exposes virtually every part of their content and operations — from IP rights to trade secrets to semiconductor design to intrusion. Traditional industries such as manufacturing and transportation can involve significant switching costs to customers. Not so for many companies in the TMT sector — in which competitors are literally just a click away for the dissatisfied customer.

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The IoT and converging infrastructure broaden the attack surface

TMT companies are placing high priority on securing the internet of things (IoT) with 43% of all TMT respondents ranking it their #1 issue. While the IoT has many benefits for TMT companies — digitizing a carrier’s entire network, or full robotic automation of a warehouse — it can also present higher cyber-risk. Especially due to the convergence of operational technology (OT) and corporate IT networks, production systems are increasingly exposed toward disruption and outages. For instance, by placing a company’s operations on an IoT platform, it can increase the level of vulnerability (e.g., more attack vectors) and present much more painful consequences when experiencing a security incident (e.g., DDoS attacks or ransomware attacks on production systems) that can bring the business to a standstill.

The changing threat landscape still represents a major challenge. Few TMT companies have high confidence that they will be able to detect breaches of their systems, and that they will be able to determine whether customer records and other critical data has been compromised. Only 1 in 4 (23%) TMT executives believe it is very likely they could even detect a major attack. TMT companies, like many others, are facing a talent shortage in digital transformation, and an especially acute shortage in cyber-security skills. This leaves them highly exposed to their cyber adversaries.

An under-resourced threat

According to Fortune Magazine’s ranking, 50% of the world’s 10 most admired companies are from the TMT space – far more than any other sector. While it takes ages and costs billions to build the brand — a company’s bond with its customers — it can be severely harmed overnight by only one successful cyber-attack.

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