Iron Mountain announced today that it has acquired privately-held archiving vendor Mimosa Systems. The approximately $112 million deal significantly bolsters Iron Mountain’s archiving portfolio with on-premises software for email, file and SharePoint archiving. With the purchase, Iron Mountain also picks up just over a thousand existing Mimosa customers and a good talent pool with expertise in archiving and eDiscovery.
My preliminary perspective is that this acquisition will entail some near- and mid-term bumps for Iron Mountain customers and prospects, but will ultimately prove positive. The three main reasons:
Message archiving remains critically important. Over the past decade, tens of thousands of organizations have adopted message archiving solutions. An array of vendors, providing archiving offerings for Exchange, Notes Domino, and other messaging systems, have helped these buyers comply with regulations, mitigate legal risk, and improve operational efficiency. While the message archiving market is mature, it’s changing and growing at a rapid clip. Although Mimosa made an impressive initial entry into SharePoint archiving last year, message archiving accounts for most of new customers the vendor signed in the last 12 months. With this acquisition, Iron Mountain demonstrates that it understands how important message archiving is to prospective buyers and its strong intent to capitalize on the opportunity.
Just this Tuesday, February 16th 2010, the Bipartisan Policy Center hosted a mock cyber attack called Cyber Shockwave. The aim of this simulation was to understand the impacts of a cyber attack and assess infrastructure capability during such an incident. There are many articles explaining the motive and results of this simulation, and post mortem is still coming as we speak.
So, what did the simulation entail? It depicted a war game taking place in 2011 – basically an application installed on smart phones during ‘March Madness’ thatturned out to be a malware. This hypothetical malware affected telecom and IT infrastructure throughout the country, with the result actually bringing down the nation’s cellular network...but there is more. According to an article from ‘The Atlantic Wire’:
“Later, two bombs disabled the country's electricity network and destroyed gas pipelines... Soon 60 million cellphones were dead. The Internet crashed, finance and commerce collapsed, and most of the nation's electric grid went dark. White House aides discussed putting the Army in American cities.”
I had a few great conversations yesterday about the increasing role analytics will play in risk and compliance programs, which brought to mind the article, For Some Firms, a Case of 'Quadrophobia' appearing earlier this week in the Wall Street Journal and referenced yesterday by the NY Times’ Freakonomics blog.
The article covers a study of quarterly earnings reports over a nearly 30 year period, which found a statistically low number of results ending in four-tenths of a cent. The implication here is that companies fudge their numbers slightly to report earnings ending in five-tenths, which can then be rounded up... clever. Even more interesting, authors of the study found that these “quadrophobes” are “more likely to restate financials and to be named as defendants in SEC Accounting and Auditing Enforcement Releases (AAER)”... not clever.
The report encourages the SEC to enhance its oversight with a new department dedicated solely to detailed quantitative analysis that might catch this type of behavior. It also occurs to me that many corporations would like to identify such trends within their four walls to detect and prevent potentially damaging behavior.
Clearly, the cultural/human aspects of risk management and compliance – policies, attestations, training, awareness, whistleblowing, etc. – are essential. But as the number and complexity of business transactions continue to grow, companies will be looking more and more for ways to analyze massive amounts of data for damaging patterns and trends.
Visa just announced the expansion of their No Signature program. Citing its "popularity", Visa notes that: "According to a Visa Inc. survey, 69 percent of participants surveyed cited either convenience or speed as the primary reason for using their credit or debit card." Wow.
What this seems to signal is that Visa, and perhaps the other card brands, feel that they will make more money by eliminating barriers to the sale, such as the 2.2 seconds needed to sign your name, than it would lose in fraudulent transactions, considering this program is for transactions of US$25 or less. Also, it appears that people no longer know how to sign their names.
I have often heard (in low, barely audible whispers) that US consumers were too lazy to care about security, which is why the US will probably never have CHIP and PIN transactions for enhanced credit card authentication. We Americans are too darn busy to push 4 numbers on a key pad (4.3 second). This drives folks in the other parts of the world crazy as they are in love with CHIP and PIN and, mistakenly, think that this technology eliminates all transaction risk. CHIP and PIN cards still have a mag stripe that can be scanned, and skimming is still a problem. It's a great authentication method, however, and would really help reduce some of the smaller, card-present CC frauds were we to adopt it.
Americans need more paranoia about credit card theft. We are much more likely to suffer some type of credit card fraud or be affected by a major credit card breach than a terrorist attack, but for some reason we are unwilling to punch in a few numbers to help protect ourselves.
The Attorney General of New York is investigating a large group of online retailers to see if they have been sharing your credit card data with third parties without your knowledge or permission. In a press release, the AG's Office details the scheme, including the fact that you may unknowingly be giving someone other than the retailer you are shopping with your credit card number:
"Information about joining the membership program and its ramifications, including the fact that the consumer is agreeing to transfer his or her credit or debit card account information, is buried in fine print and cluttered text."
My gut tells me that this violates the spirit, if not the letter, of the PCI Data Security Standard. According to the PCI DSS:
"Additionally, merchants and service providers must manage and monitor the PCI DSS compliance of all associated third parties with access to cardholder data."
It is probably safe to assume that the business agreement around the data sharing identified by the New York AG's office did not include language surrounding PCI compliance.
An MSNBC story on the investigation puts it this way:
Wireless hacking Guru, Josh Wright,has just announced that he has created havoc with a MiFi personal access point.MiFi is a little device that turns 3G wireless signals into WiFi. The cool thing is that the wireless signal can be shared with other nearby computers. According to Josh, he has found a way that, "An attacker can recover the default password from any MiFi device." This is big news because anyone who is involved with wireless ne
In my ongoing work with clients, I try as often as possible to stress the importance of flexibility in GRC programs. Internal processes and technology implementations must be able to accommodate the perpetually fluctuating aspects of business, compliance requirements, and risk factors. If GRC investments are made without consideration for likely requirements 1 to 2 years down the road, decision makers aren’t doing their job. And if vendors don’t offer that flexibility, they shouldn’t be on the shortlist.
News outlets over the past year have given us almost daily examples of change in the GRC landscape. The recent stories coming out of Davos have been no exception... giving us some truly fascinating debates on the necessity and detriment of regulations. As quoted in a Wall Street Journal article on Sunday, Deutsche Bank AG Chief Executive Josef Ackermann argued against heavy-handed regulation, saying, "We should stop the blame game and we should start looking forward... if you don't have a strong financial sector to support the this recovery... you're making a huge mistake and you will regret that later on," he said. French President Nicholas Sarkozy summed up the opposing argument in his keynote, explaining, "There is indecent behavior that will no longer be tolerated by public opinion in any country of the world... That those who create jobs and wealth may earn a lot of money is not shocking. But that those who contribute to destroying jobs and wealth also earn a lot of money is morally indefensible."
Security Researchers in the UK say that the 3-D Secure (3DS) system for credit card authorization, a protocol that was "developed by Visa to improve the security of Internet payments," has significant security weaknesses. It is used by both of the ginormous card brands, known as "Verified by Visa" and "MasterCard SecureCode."
This could be a big deal.
In a recent paper, the researcher calls out 3-D Secure as a security failure that was pushed on consumers by financially incentivized merchants because, "its use is encouraged by contractual terms on liability: merchants who adopt 3DS have reduced liability for disputed transactions. Previous single sign-on schemes lacked liability agreements, which hampered their take-up."
According to the authors:
"3-D Secure has lousy technology, but got the economics right (at least for banks and merchants); it now boasts hundreds of millions of accounts. We suggest a path towards more robust authentication that is technologically sound and where the economics would work for banks, merchants, and customers - given a gentle regulatory nudge."