Posted September 23, 2022
By Ray Blanco
Computer Warfare: Cybersecurity Concerns From the War in Ukraine
Cybersecurity concerns have steadily grown for years now while hacking attacks increase in frequency.
As we become more dependent on technology across all industries, the need for bolstered cybersecurity capabilities grows.
Recently, tech giant Google has picked up on a growing number of pro-Russian hackers that are working with Russia’s military intelligence in the midst of the conflict in Ukraine.
For a few months now, a cybersecurity group at Google has been keeping an eye on the alleged coordination between hacking groups in Russia and cyber breaches coming from Russia’s military intelligence.
These coordinated attacks have caught the attention of western security experts too, who are looking into the situation to get a drop on Russia’s intentions inside and outside Ukraine.
A major concern for US and EU officials is that hackers could target Ukraine’s allies, putting critical infrastructure and government systems in the crosshairs.
For now, that fear hasn’t had the opportunity to materialize.
However, one hacking group involved, called XakNet, has been named by the Department of Homeland Security as a potential threat to infrastructure in the US.
This creates a pressing need to bolster cybersecurity efforts in the US across several industries.
A Closer Look at Cybersecurity Names
Cybersecurity names have had a painful 2022 so far, but with the growing concerns over foreign cyber attacks, I think this sector is worth a closer look.
Back in July, Morgan Stanley surveyed a group of chief information officers, the survey found that cloud computing and security software remain at the top of priority lists.
So while cybersecurity names have been underperforming this year, there are a lot of eyes looking for some strength.
Especially with the recent data breach at Uber Technologies Inc. (NYSE: UBER), company officials across multiple industries in the US may be looking into contracts with cybersecurity firms.
Earlier this year, Google-parent company Alphabet announced that it would be acquiring cybersecurity firm Mandiant with a $5.4 billion cash deal.
The deal will make Mandiant part of Google's cloud computing business.
Mandiant is also the group that gathered evidence on the spike in Russian hacks that I mentioned above.
Zooming out a bit, worldwide cybersecurity spending increased by about 13% in 2021, hitting $172 billion.
And according to market research firm Gartner, cybersecurity spending is expected to increase by another 11% in both 2022 and 2023.
Among cybersecurity firms, those that provide cloud computing services will likely have a competitive edge.
And even with the struggling performance this year, cybersecurity stocks did manage to get a boost back in February when Russia first invaded Ukraine.
With the recent report from Google about the increased frequency of pro-Russian hacking, there’s a chance another boost is in the cards.
Moreover, in the recently passed US infrastructure bill, Congress is expected to include additional funding for cybersecurity infrastructure across federal, state, and local levels.
Given all of these developments, I think cybersecurity names are worth keeping an eye on. Maybe we’ll see some bullish momentum get underway.