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The importance businesses attach to data analytics has driven the growth of a successful niche of the technology industry. The potential of the sector is now increasingly being realized in stock market value, evidenced by the recent IPOs of Palantir and Sumo Logic.
The Palantir IPO represents a particularly important milestone in the development of the data analytics industry, not least because the company was valued at nearly $16 billion when it began trading on September 30th. As such, it is one of the largest software IPOs since Uber (though Snowflake was a tough act to follow), and it offers proof that AI and data-driven software is the future, particularly during this forced remote work period across the globe.
Though it feels like workers are siloed right now, performing their jobs in isolation, companies’ data shouldn’t be fragmented. On an ongoing basis, researchers, IT administrators, and security professionals on the front lines shouldn’t have to navigate multiple tools to get the full picture they need. Palantir, and other complementary companies in the technology space, pull all relevant information into one platform, getting the right data to the right people quickly. While there is some debate around certain customer use cases, Palantir’s tools have been used for high-profile projects, such as tracking the spread of COVID-19 and helping the CIA in locating Osama bin Laden — confirming that this approach to data analytics is highly valuable.
Parts of the cybersecurity industry are utilizing similar principles to help security operations and insider threat teams work smarter, whether they’re in the office or working from home. Combined with machine learning, this approach allows security teams to detect anomalous behavior that wouldn’t be possible with human observation alone. Specifically, they can detect lateral movement, notably between cloud applications, cloud infrastructure, on-premises IT resources, and OT and IoT devices. This is essential, given that 80 percent of companies across the U.S. and U.K. have seen an increase in attempted cyberattacks since the start of the pandemic.
On a different scale, but no less interesting, is Sumo Logic, a 10-year-old business specializing in cloud log management, monitoring, and security information and event management (SIEM) tools — which completed its IPO during September, raising over $300 million in the process. In doing so, it became the latest SIEM player to go public, following its acquisition of JASK last year.
In a wider context, this isn’t surprising. The cybersecurity industry is known for its resilience, and the sector has stood out as one of the few industries relatively untouched by the current pandemic. The shift to remote-first working has played an important role in this ongoing success, as companies have found it increasingly difficult to identify and mitigate threats on individual employees’ computers. What’s more, the growth in phishing scams, insider threats, credential-stuffing attacks, and ransomware in the wake of the pandemic has forced organizations to rely on security solutions and partners to stay protected.
The net result of these issues and the wider importance of the industry, in general, is that the cybersecurity sector could be valued at almost $434 billion by 2030, grossing more than $300 billion in only 10 years, according to a new study by P&S Intelligence. The rapid growth of the industry, even in the context of unprecedented events, was likely a driving factor behind Sumo Logic seeking its IPO.
Despite this milestone for Sumo Logic, it remains important for organizations to look closely at the technology powering these and other solutions. Ultimately, organizations need systems designed from the ground up for big data and cloud deployment in order to keep up with today’s challenges. With security teams no longer confined to the walls of a security operations center (SOC) and instead forced to collaborate virtually, solutions powered by machine learning are vital to combat alert fatigue and to prevent threats from slipping through the perimeters.
Advanced analytics, which Sumo Logic lacks, is now table stakes. It’s an approach that enables individual security alerts to be placed within the context of the big picture, providing faster and better decision-making. In doing so, attacker techniques such as lateral movement, that were nearly impossible to detect with legacy technology, can now be readily detected to identify compromised or malicious users.
Data analytics has a huge future, as businesses look to it to deliver a competitive edge, to understand their markets, and to supplement human experience with in-depth insight. In the years ahead, we can expect to see many more analytics innovators join the likes of Palantir and Sumo Logic in translating business success into shareholder value.