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“Patently” secure

One thing that occasionally becomes interesting about working in security is that doing security and managing business have a great deal of overlap. This makes a lot of sense: a business wants to be profitable, and profit is a reward conferred by the market for taking on some risk. But too much risk can expose your business to undesirable failures, so understanding and controlling your exposure to risk is a useful exercise.

Well that’s fundamentally how security works too. There is some reward to be gained by performing the activity allowed by an app: that might be the enjoyment of playing a game, the cost savings of keeping track of your finances, or the health benefits of seeing what food you consume. But using the app also brings some risk, and so security people seek to quantify and reduce the risk inherent in any app.

I’m going to compare a business risk (infringing on another’s patent) to an information security risk (leaking confidential data) to show just how similar these fields are. I choose patent infringement because it’s an apposite case: however you’ll find that I don’t name particular patents or companies for reasons that will be entered into below. Suffice it to say that I have dealt with software patent lawyers in the past and have some – but not much, by any means – experience of how the US patent system operates. If you choose to infer any advice from this blog post, please seek appropriate counsel before acting on it: I am not a lawyer, and I am certainly not your lawyer.

Quantisation

A risk to either a business or a user can be summed up by the expected damage caused by the event coming to pass. That is, the estimated cost (financial, emotional, intangible etc.) of the risky event multiplied by the expected probability of that event happening.

In the leaky data case, the expected damage would be “what chance is there that an attacker will retrieve the data” × “what is the impact to the user of exposing the data”? Both of these parameters are hard to quantify: information about data security breaches is notoriously hard to get hold of because companies are reluctant to talk about problems they’ve had protecting their customer records. Combine with that the fact that in many fields even the direct costs of a breach are hard to arrive at, and you end up multiplying two very big error bars together.

In the infringement case, things are a bit more straightforward. Legal reports are – in many jurisdictions – a matter of public record, so seeing what the damage of a case “like yours” is going to be is quite easy. That covers direct costs, anyway: indirect costs like lost custom, damaged reputation etc. are harder to arrive at. The likelihood of being caught infringing on a patentholder’s rights is harder to estimate, but I expect not beyond the realms of reason.

Mitigation

There are a few different approaches to reducing (mitigating) the risk involved, which either address the likelihood or expected cost of impact. Let’s look at them. You don’t have to choose any one approach: a successful strategy may combine tactics from each of these categories and even use more than one tactic from the same category.

Withdrawal

Remove any likelihood and impact of a risky event occurring by refusing to participate in the risky activity. In the confidentiality case, this means not storing the secrets in the first place. In the patent case, it means not using the potentially infringing invention.

In either case withdrawing from the activity certainly mitigates any risk very reliably, but it also means no possibility of gaining the reward associated with participation.

This is why, going back to an earlier point, I don’t comment on particular patent cases. Given that patent rights asserters are, in my opinion, more litigious than I, there’s a chance that if I talk about a particular case I’ll be considered defamatory. I’d rather avoid that risk, and choose to control it by withdrawing from talking about the cases.

Transference

You can opt to transfer the risk to another party, usually for a fee: this basically means taking out insurance. In either of our case studies, look for insurance that protects against the damage incurred. This doesn’t affect the probability that our risky event will come to pass, but means that someone else is liable for the damages.

Employing Countermeasures

Finding some technical or process approach to reduce the risk. In the patent case this is simple: the countermeasure to “sued by patent holder” is “license patent”.

In the confidentiality case, this means technical countermeasures: access control, cryptography and the like.

But think about deploying these countermeasures: you’ve now made your business or your application a bit more complex. Have you introduced new risks? Have you increased the potential damage from some risks by reducing others? And, of course, is your countermeasure cost-effective? The traditional security mantra is “don’t spend $1000 to save $100”: don’t license $1000 of patents to protect a $100 product, and don’t implement $1000 of crypto to hide $100 of data.

Acceptance

The “suck it up” approach to security: accept that the risk exists and that you may be liable for the damage if it ever comes to pass. In our information security case, this means storing the data and accepting that someone else might be able to read it. In our patent case, this means adopting the potentially-infringing invention and accepting that a licensor might come a-knocking.

All risk mitigation strategies have a certain amount of acceptance involved, apart from withdrawal. Imagine that you pay some insurance premium, and that indemnifies you up to $10M with an excess of $1000. You have to choose whether you accept the residual risk exposed in covering the excess and any overage.

Similarly, in the information security case, let’s say you have data assets which, if leaked, would cost $1M in damages. You implement a particular cryptography technique that reduces the likelihood of leaking the data from an estimated once per year to an estimated once per thousand years. Again, do you accept the remaining $1000?

Conclusion

Information security and business management are actually pretty closely related. It’s just that information security requires specialised technical knowledge: and that’s where I come in ;-).