A new report on cybersecurity in Canada says that cyber attacks on Canadian companies and organizations are becoming more frequent, rising by about 30 per cent since 2014. Unfortunately, those under attack believe that they are losing the fight, as the attacks become more sophisticated, more severe, more costly, and more frequent. The average reported cost of remediation after an attack was $7.2 million, including clean up, lost productivity, disruption of normal operations, damage or theft of IT assets, and damage to reputation and image. The report is from Scalar Decisions and the Ponemon Institute.
A high-profile and timely example of the cyber threat occurred just as the Scalar report was released. The retail giant Canadian Tire came under cyber attack this week, leaving customers unable to sign in to access various services, including credit card information and transaction history. The company referred to “unusual traffic” on its website before suspending the sign-in service.
An opportunity for Ontario
But where there is a big problem there is big opportunity. A separate report, this one from Deloitte, calls for Canada, and Southern Ontario specifically, to take a much stronger leadership role in the field of cybersecurity, building on existing strengths, which include a strong technology sector, excellent R&D facilities, numerous post-secondary educational institutions to provide talent, and the presence of first-class incubators and accelerators for start-up enterprises.
At the federal level, the government launched a public consultation on the subject of cybersecurity last summer. Ralph Goodale, the minister responsible, noted that the global market for cyber professionals is expected to rise by six million in the next five years, and the market for services and products by $170 billion. While Canada’s cybersecurity SMEs attracted significant capital investment in the past five years ($244 million according to the Deloitte report), there is clearly opportunity for more companies to take a greater share. There are few cybersecurity companies in Canada, just thirty according to IT World Canada. Israel, on the other hand, has 400, having made itself the largest and most successful cybersecurity innovation hub outside the United States.
Ontario has all the ingredients to become a global hub for cybersecurity innovation but has not yet reached the scale and gravity necessary to compete at the highest levels. Despite these ingredients and historically strong performance, Ontario risks losing its competitive position through failing to match the concerted efforts of governments and industries around the world that are ramping up investment and coordination in fostering cybersecurity innovation.
Southern Ontario, home to Canada’s financial services sector and many technology companies, is the perfect place to develop into a global hub like Israel, according to Deloitte. Ontario “must” seize the opportunity, the report urges, for the long-term security and prosperity of the financial services industry and the economy at large may depend on it.
The report says that to date the financial services industry has not been focused on cybersecurity, and very few (27 per cent) of interviewees for the report had had any contact with cybersecurity startups in the past twelve months. This, says Deloitte, is one of the main potential sources of “friction” within the “ecosystem.” Barriers to adopting new cybersecurity solutions include not wanting to be the first to adopt, and worries about the scale and solvency of the vendor.
Despite such areas of friction, all of the ingredients are in place in Ontario to become a global hub, Deloitte says, but it has not yet reached the “scale and gravity” needed to compete at the highest levels. A cybersecurity talent shortage is one challenge the province faces. Limited collaboration in applying Ontario’s R&D strengths to cybersecurity problems is another. To remedy these and other shortcomings, a cybersecurity innovation hub—a “physical centre of gravity”—should be set up in order to
- Connect Ontario cybersecurity SMEs with markets and capital
- Attract talent and innovators to start cybersecurity businesses in Ontario based on strong access to markets and a favourable business environment
- Develop international partnerships
- Provide a central source for information and consistent messaging on cybersecurity innovation in Ontario