The big boys like Microsoft (MSFT) and HP (HPQ) had almost nothing interesting to say. Their presentations were so generic and fluffy that I almost fell asleep. But one aspect of Microsoft’s presentation caught my attention... Last year, businesses lost $1 trillion to cybercrime. And that’s expected to grow to $3 trillion by 2020. That’s right... In the next three years, the financial damage from cybercrime is expected to triple. Cyberattacks on major companies have made news in recent years... Cybercriminals attacked health insurance- company Anthem (ANTM) in 2015. The hack compromised tens of millions of customer accounts. Search-engine giant Yahoo also suffered from numerous cyberattacks in 2016. The incidents forced Yahoo to renegotiate its merger with telecom titan Verizon Communications (VZ) as a result, losing $350 million in the process.
I’m talking about the rising threat of cybercrime in the United States... This new criminal element is quickly becoming an epidemic as numerous companies and individuals fall victim. Markets don’t understand how severe this threat is yet, but they will. And that presents a unique opportunity for investors. Let me explain... I attended seven conferences and several other tech-related events during the first three months of this year, including the RSA Conference. It’s the major annual cryptography and cybersecurity conference of the tech industry. It has become massive, with 43,000 visitors attending. The company that put on the conference, RSA Security, created and successfully deployed public key cryptography – the underlying technology that allows people to send encrypted messages back and forth. The conference was a great place for industry meetings, but many of the presentations are highly “scrubbed.” Companies aren’t as open and forward-looking as they used to be. These new criminals aren't desperate amateurs. They're fully funded, sophisticated criminal organizations that function like normal corporations. $3 Trillion Stolen by 2020
The Cybersecurity Industry Is Unprepared
These types of cyberattacks will continue. Large cybersecurity firms can’t keep up with the surge in cybercrime. Their product development is just too slow. And even if a firm could put in place all the safeguards necessary to keep networks and data safe, the defenses would be so burdensome that the organization wouldn’t be able to function.
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