5 Reasons Why COVID-19 Will Bolster the Cybersecurity Industry
Amid sharply falling public markets and spiraling panic around the rapid proliferation of the coronavirus (a.k.a. COVID-19), the cybersecurity industry seems to be well poised for sustainable growth despite some foreseeable turbulence.
Publicly traded security companies and some specific niches will unescapably suffer in a short term, however, private cybersecurity companies and later-stage startups with sufficient reserves of cash may rapidly gain new clients and markets. That is not to say that the industry will enjoy an absolute and everlasting success but, contrasted to other sectors of the economy, will be in a comparatively good shape.
Let’s have a look at the five underpinning reasons for a bright future in the cybersecurity industry among the coronavirus havoc:
Many traditional businesses will flee online
Countries affected by the coronavirus now actively restrain or even flatly prohibit a wide spectrum of daily activities including attending schools, visiting public places and restaurants, let alone international travel and conferences. Unsurprisingly, most of the affected businesses will have now to swiftly reinvent themselves and adapt to the new reality or see revenues hit extremely hard.
A considerable number of offline processes will somehow migrate to the Internet, replacing consultations with doctors and lawyers with agile video calls, favoring Zoom and WebEx for internal business meetings, delivering food and goods to homes instead of eating out or weekend shopping in overcrowded malls.
These are to name but a few, though the overall picture seems to be crystal clear: businesses will boldly move online. Consequently, pretty soon they will inherently require cybersecurity and compliance services of a diversified size and nature. Foreseeably, the most agile cybersecurity SaaS offerings, tailored to be easily consumed, deployed in a highly adjustable manner and offered at a competitive price, will likely have the best success among the newcomers.
Cybersecurity will become a competitive differentiator
Unfortunately, some of the recently flourishing industries and markets may suffer a sharp tumble of new deals and clients scared off by the infection. Those who will timely implement viable digitalized alternatives, will likely face tough competition amid grim economic slowdown that some economists and politicians now convincingly predict.
A non-neglectable part of the targeted audience may be overly prudent and reluctant to substitute payments in subconsciously safe cash or cheques to online credit card processing or e-payments. Even in Western countries, a considerable part of the population still distrusts Internet payments. Hence, properly implemented, explained and advertised cyber hygiene, data protection and compliance to cybersecurity standards such as ISO 27001, the UK’s Cyber Essentials or US’s NIST Cybersecurity Framework, will undoubtedly provide assurance for the new class of hesitant consumers.
Regulators will deploy a wider and deep scrutiny of e-businesses
In the overall rush and race for survival, some organizations in digital transit will inevitably be negligent or careless, putting their clients at high risk, and offering themselves as low-hanging fruit to shrewd cybercriminals – a situation that watch dogs and regulators will unlikely condone. Thus, to ensure smooth and secure digitalization of business, more regulatory resources will probably be allocated to policing conformity with a multitude of state and federal data protection and privacy regulations.
Resultingly, businesses who were previously exempt from obligatory compliance due to a low number of processed PII or annual transactions akin to the offered under Californian CCPA for example, or who simply disregarded the rules in impunity, will likely have a good chance of facing fairly harsh monetary penalties and other sanctions under the applicable law. Eventually, they will allocate at least a modicum of their budget to mitigate cyber risks, sooner or later.
Investors will favor cybersecurity startups
Some venerated investors and VC veterans have already expressed their growing concerns about the looming crash of the global economy, hypothesizing that Covid-19 may be the next Black Swan, fatal for many companies all over the world. Nonetheless, in 2019 and 2020, a virtually unprecedented number of investment funds have successfully harvested new capital and will unlikely keep their powder dry especially in light of incremental rate cuts by national banks.
Both venture capital and private equity of a different focus will surely consider putting at least a part of their monies into a comparatively riskless cybersecurity sector if regarded through the prism of a global epidemic. Some of the erstwhile flourishing and unfading sectors of innovation, that require or imply human bodily contact, may temporarily become much less attractive, ceding their place to more resistant and thus competitive cybersecurity players.
Digitalization will mushroom and mostly remain
Importantly, a substantial percentage of the aforementioned digital shift will likely remain after the coronavirus finally disappears. Certainly, not everyone will continue remote working from home or substitute evenings in cozy pubs with Netflix, however, many common processes will definitely move into the digital space, augmenting their overall efficiency and effectiveness.
At the end of the day, more people will become even more dependent on the Internet and will unquestionably require safety of their data, privacy and a sense of control over their digital ecosystem. In light of the multidimensional digitalization, cybersecurity companies now have a boundless opportunity to embody their innovations and leverage creativity for a sustainable benefit of the modern society.
Above all, let’s keep calm, follow the precautions prescribed by national health authorities, and focus on delivering value and excellence to our clients and partners. Cybersecurity is poised to succeed.