Gartner Expects 2018 IoT Security Spending to Reach $1.5 Billion

Regulations, breach concerns will push spending to over $3 billion by 2021, analyst firm says.

Enterprises worldwide will spend $1.5 billion this year protecting their IoT networks and connected devices against a range of security threats, according to new estimates from Gartner.
That figure represents a 28% increase from the $1.2 billion spent on IoT security last year and reflects growing enterprise concern over vulnerabilities in IoT and connected networks. Gartner says by 2021, such concerns will push IoT security spending to over $3.1 billion.
Exposure to IoT-based threats may come from unauthorized devices that connect to enterprise systems and that the enterprise does not control, says Ruggero Contu, research director at Gartner. In that sense, IoT networks and devices present the same problem to enterprises that any shadow IT does, he says.
There is also the potential issue of organizations being vulnerable to devices owned by third-party business partners or suppliers, he says. One example is a business that uses facilities like smart buildings - which they might not own - and may be a source of new threats.
IoT-based attacks are a reality, Contu says. A recent survey by CEB Inc., a research firm that Gartner acquired last April, found that nearly 20% of organizations with IoT networks have experienced at least one IoT-related attack already.
Enterprise IoT vulnerabilities pose a threat to the devices themselves, the data in them, the services they may handle, and the broader enterprise network. As malware like Mirai hammered home, attackers can also take advantage of vulnerable IoT devices to build massive botnets for launching DDoS attacks and distributing malware.
Concerns over such issues are growing as organizations across the spectrum are connecting more devices to the Internet to establish a pervasive digital presence, according to
Gartner
.
Operational Technology (OT) such as industrial control systems and elements of smart grids such as smart meters, vehicles, and smart buildings are all examples of enterprise IoT, Contu notes. Internet connectivity allows for improvements in operations — such as predictive maintenance, he says. It also enables the delivery of more customized services, improvements in customer experience, and data aggregation for business strategy improvements.
Despite the broadening IoT footprint, many organizations have not prioritized or implemented security best practices for protecting the environment, according to Gartner.
Where IoT security has been implemented, it is usually at the business-unit level with some cooperation from IT departments. However, there is little effort to coordinate IoT security via a common architecture or through a consistent security strategy, the firm said in its report. IoT vendor, product, and service selection at many enterprises remains largely ad hoc and few IoT security practices have been codified into policy or repeatable best practices.
IoTs Inherent Insecurities
The lack of security by design in the IoT devices is another huge problem. Many devices that enterprises have begun connecting to the Internet have little by way of security protections and, worse, are not equipped even to receive OS updates, security patches and over the air fixes, Contu says.
Security vendor Avira
points
to 2017 scanning data from Shodan that showed over 128.7 million IoT devices exposed to the Internet in the US alone out of which 25 million were vulnerable to a total of 45 different exploits.
Its what we always see with big pushes in technology, says Bryan Singer, director of security services for IOActive. Theres a race to be first to market and unfortunately, when that happens, were not paying enough attention to full supply chain security, he says.
The bottom line is that IoT devices and apps are so nascent right now that [they really dont] represent the maturity of code design we see elsewhere, Singer says. Hardware and software is not often fully vetted for security issues and many IoT startups are just not disciplined enough when it comes to testing software design. With the explosive growth of devices, were seeing explosive IoT vulnerabilities because devices are designed and deployed without security in mind.
Troublingly, over the next few years expect to see a lot of companies turn to hosted services for their IoT data collection and management needs, Singer says. This will create new problems over data control and security, he says.
Brian Contos, CISO of Verodin, says that from a security industry perspective there was an expectation early on that the manufactures of many of the products that constitute the IoT would bake security into their devices. Unfortunately, that has simply not happened in a broad enough manner, he says.
And there are so many IoT device types and vendors that it’s challenging to determine what risks they bring and what levels of controls can be implemented to mitigate that risk, he says. The net result is that just like happened with IT security: everybodys playing security catch-up with IoT security as well, Contos says.
Tools
Gartner predicts that concerns over IoT risks will drive spending for tools and services that can help organization discover and manage IoT assets on the network, perform security assessments of IoT hardware and software, and conduct penetration testing. Professional services will account for $946 million of the $1.5 billion in total that organizations will spend on IoT security this year, according to Gartner. By 2021, IoT security service spending will more than double to nearly $2.1 billion.
IoT endpoint security tools, such as those for asset discovery and management, are another area where Gartner expects enterprises to spend a lot of money over the next few years. In 2018 organizations will spend upwards of $370 million on endpoint security and over $630 million in 2021. Spending on products that secure IoT gateways will more double from $186 million this year to $415 million in 2021.
It makes sense that IoT security spending is on the rise and will continue to increase moving forward, says Tyler Reguly, manager of software development at Tripwire.
The enterprise attack surface just continues to broaden with everything, including kitchen gadgets such as slow cookers, coffee pots, and refrigerators being interconnected, he says. These new devices with their lack of centralized management and no formal patching processes are an administrators worst nightmare.
Related Content:
Get Serious about IoT Security
The Internet of (Secure) Things Checklist
Securing the Web of Wearables, Smartphones & Cloud
8 Ways IoT Manufacturers Can Improve Security

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Gartner Expects 2018 IoT Security Spending to Reach $1.5 Billion