Cybersecurity has been in the news this year with the recent hack to the Colonial Pipeline that set off gas shortages in some parts of the country. This is just one of the latest cyberattacks that we’ve seen.
It’s a “new age” for cybersecurity in the wake of recent cyber-attacks tied to SolarWinds and Microsoft, Wedbush Tech Analyst Dan Ives says – a significant ramp up from the recent couple of decades of such attacks.
Given the rapid move to the cloud for both businesses and individuals, the need for cybersecurity and cloud storage has become critical for businesses and individuals.
Major Cyber Incidents and Their Impact on Consumers
The Colonial Pipeline hack resulted in severe gas shortages in the east and southeast portions of the U.S. over a number of days. Colonial supplies about 45% of the gas consumed on the east coast. Colonial paid about $5 million in ransom to the cyber hackers and was able to resume service, but the disruption was significant.
The SolarWinds hack in early 2020 was perhaps even more significant, though the impact was more tied to businesses and several governmental agencies who use this system. Their widely used Orion system was hacked and updated with a code that provided a link to customer’s systems and data was sent out by the company to their customers.
Brad Gastwirth, Wedbush Chief Technology Strategist says, “The US government will also be rethinking their security rollout across organizations. Expect to see large initiatives from many government agencies that can be very significant to the entire space.”
Emerging Companies in the Cybersecurity Space
Gastwirth says, “Cybersecurity will continue to be a dominant theme across enterprise software. The pandemic forced enterprises to rethink their strategy and spend billions to block cyber threats. There is not just one company that wins here, but several companies that play into many areas across cyber security will win.”
Top Wedbush picks in the cybersecurity space include these seven companies:
- Varonis Systems
- Telos Corp.
- Sailpoint Technologies
- Tenable Holdings
- Palo Alto Networks
- Amazon Web Services
The Growing Dependence of Companies and Consumers on Cloud Storage
Companies that offer solutions in cloud storage will see increasing demand from corporations. Wedbush Tech Analyst Dan Ives and his team think that 44% of workloads will move to the cloud by the end of 2021, and that this figure will reach 55% by 2022.
Many large players in the technology space are making a significant push in the cloud space including:
- Amazon Web Services
- Microsoft Azure
- Google Cloud Platform
- Alibaba Cloud
- IBM’s Red Hat service
These giants as well as a number of smaller players have flocked to the cloud space due to the demand for corporate customers as well as consumers. Cloud storage offers a number of advantages including:
- Cost savings. Things like hard drives and all of the accessories that go with supporting them are no longer needed. This includes the electricity to power these large enterprise level hard storage devices.
- Data redundancy is a built-in feature as most cloud storage providers keep multiple copies of your data.
- Different tiers of storage services can help save money. Individuals and companies can select the level of storage service that meets their needs and not pay for capabilities they don’t require.
- Regulatory compliance. This can apply to companies who are obligated to store customer data in the same geographic region where their customers are located, such as the European union.
- Ransomware and malware protection. Cloud storage can provide an added level of security against these increasingly frequent threats to your data security.
Securing Your Data at Work and at Home
With the rise of remote work during the pandemic, and the expectation that remote work is here to stay at least in part, it’s critical that companies establish systems and protocols to keep their data secure. Cybersecurity will become an even more vital part of doing business.
With the rise of online transactions and accounts for just about everything we do as consumers, cybersecurity and secure cloud storage are crucial for consumers as well.
Implications for Investors
Wedbush research analysts expect cybersecurity spending to jump more than 20% in 2021 alone. Companies who can provide cybersecurity and accessible cloud storage should fare well in the post-pandemic world.
Gastwirth says, “You can argue that post-pandemic and because of remote workers the environment has gotten even more dangerous for enterprises who will need to spend even more to secure their networks.”
All cybersecurity and cloud storage offerings are not created equal, however. As with all sectors there will be winners and losers who emerge. Investors need to understand the pros and cons of the technology and the product offerings of any companies in these sectors before investing.
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