IBM Security has become a juggernaut

Brendan Hannigan, General Manager of IBM Security, was hired by IBM in 2011 as part of the company’s takeover of Q1 Labs, a Waltham, Massachusetts, provider of network security intelligence software.

Q1 Labs is one of about 15 security acquisitions IBM has made over the past decade.

Hannigan moved up the ranks and now sits at the helm of a $1 billion-plus business that combines those acquisitions and IBM’s security services into one identifiable brand – IBM Security – that caters to chief security officers and senior IT executives at major corporations globally.

“IBM is ushering in an intelligence-driven era of security with our clients,” says Hannigan. “With the rate, pace, and sophistication of cyber-attacks continuing to grow exponentially, security has become a big data problem. Real-time analytics are required as the foundation of today’s security strategy. IBM partners with our clients across their C-Suite and Line of Business to develop integrated and comprehensive analytics-driven protection strategies. We are outpacing the competition because we help clients safeguard the full spectrum of a risk framework – people, data, applications and infrastructure – by deploying the industry’s broadest portfolio of security consulting, services, and software. Our offerings and capabilities range from protection against advanced threats to securing a client’s most sensitive and important assets to solutions for cloud and mobile computing that enable innovation without increasing risk.”

Although IBM’s security business only accounts for 1% of IBM Corp.’s total revenues, the business grew by an impressive 19% in 2014.

According to Cyber security Ventures’ Q2 2015 Cyber security Market Report, the worldwide cyber security market is defined by market sizing estimates that range from $71 billion in 2014 to $155 billion-plus by 2019.

IBM says it is aiming for $40 billion in revenues over the next few years from its next-generation technologies, which include cloud services, business analytics, mobile, and security. At the moment, security takes in the least revenue out of those. The growth opportunity for IBM Security is huge. But how important is security to IBM in the context of everything else it does?

IBM Security By-The-Numbers

IBM Security has 10,000 clients in 133 countries, 6,000 researchers, developers, and SMEs focused on security, 3,700 security-related patents, and 36 IBM Security locations across the globe (11 SOCs, 10 security research centers, 15 software security development labs).

IBM Security Services manages 20 billion-plus events per day, with more than 3,700 clients worldwide in 133 countries.

IBM Security hosts one of the world’s largest URL databases with 25 billion-plus web pages and images, collects 1,000 financial malware samples daily, and leverages intelligence from 270 million-plus endpoints

IBM X-Force Exchange

The IBM X-Force Exchange threat intelligence network launched this past April. The platform provides open access to historical and real-time data feeds of threat intelligence, including reports of live attacks from IBM’s global threat monitoring network, enabling enterprises to defend against cybercrime. Designed to help move the industry forward on threat intelligence sharing, IBM’s vast library of security intelligence data via IBM X-Force Exchange includes:

  • One of the largest and most complete catalogs of vulnerabilities in the world
  • Threat information based on more than 15 billion monitored security events per day
  • Malware threat intelligence from a network of 270 million endpoints
  • Threat information based on more than 25 billion web pages and images
  • Deep intelligence on more than 8 million spam and phishing attacks
  • Reputation data on nearly 1 million malicious IP addresses

The industry is quickly taking notice of the crucial need for an initiative of this type, with more than 1,000 organizations across 16 industries, with five of the world’s top 10 banks and six of the top 10 retailers having joined the Exchange already.

Battling Cybercrime

Cybercrime is on the rise and costing the world economy hundreds of billions of dollars annually.

“Cybercrime has become the equivalent of a pandemic – no company or country can battle it alone,” said Hannigan. “We have to take a collective and collaborative approach across the public and private sectors to defend against cybercrime. Sharing and innovating around threat data is central to battling highly organized cybercriminals; the industry can no longer afford to keep this critical resource locked up in proprietary databases. With X-Force Exchange, IBM has opened access to our extensive threat data to advance collaboration and help public and private enterprises safeguard themselves.”

New Era

IBM reported Q1 2015 revenue of $19.6 billion for the quarter, $100 million less than analysts had predicted and down 12% year-to-year, according to Forbes. IBM’s cloud business saw growth of 60%, and Cloud-as-a-Service took in $3.8 billion in revenue. IBM’s business analytics was up 12%.

It appears IBM’s future success is tied to next-generation technologies. Considering IBM missed on revenue in Q1 2015 for its eighth of nine quarters in a row – even with its cloud and analytics businesses trending up, you should expect to hear a lot more about IBM’s security business in the latter part of this year and in 2016.

In a recent webcast presented by Hannigan, he offered the following about IBM Security’s new era:

  • The security market is fragmented, which is an opportunity for IBM to lead as a broad provider
  • High-growth areas are security analytics/SIEM (10%); Threat Intelligence (10%+); Mobile Security (18%); and Cloud Security (50%)
  • IBM Security’s go-to-market strategy is to support the CISO agenda, innovate around megatrends (advanced threats, cloud, mobile, IoT, compliance mandates, labor shortage), and lead in selected segments that comprise the IBM Security portfolio
  • Security is a key IBM growth initiative

If the last point is true, then IBM Security will need to add another zero to the end of its revenue in order to be more than a blip on IBM’s total revenues.


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