Istari

The ‘Market for Lemons’ in the Limelight

In its June 2021 issue, The Economist examines the surging cyber threat. Following high-profile cyber attacks on Colonial Pipeline (the largest fuel pipeline system in the US), JBS meat (the world’s largest meat producer), and Irelands National Health service, The Economist argues that we have entered a new age of cyberattacks that comes with huge economic costs.

In the article titled "Over there in the shadows", The Economist describes key complexities in the cybersecurity industry:

  • Nation states lead multifaceted roles, needing to be equipped with defensive and offensive capabilities to secure their corporate citizens and infrastructure.
  • Expectations around paying ransomware are unclear; there is a lack of state or global guidelines.
  • Cybersecurity technology looks increasingly ineffective; it is hard for buyers of technology to assess its effectiveness.

To make the case for the last point, The Economist uses insights from research conducted by ISTARI managing director Joe Hubback. His corresponding report, titled “Cybersecurity Technology Efficacy: Is Cybersecurity The New "Market for Lemons”?  ”, exposes information asymmetries in the cybersecurity industry, which make evaluating cybersecurity software difficult.

To improve cybersecurity, the industry needs a better way of measuring and evaluating the effectiveness of the software in the market.

Working with clients and partners across the cybersecurity industry, ISTARI aims to reduce information asymmetries in the cybersecurity industry, improving the effectiveness of defences against the surging cyber threat.