The past two years have seen a raft of M&A for companies that help secure operational technology (OT) networks. OT networks comprise industrial controls, building management systems, fire and safety systems, and any sort of networked device that monitors and controls physical equipment.
The drive for IoT and digital transformations has pushed many OT networks to connect eventually to an IT network, and then to the greater internet. From a security standpoint, that means all of the malware and viruses on IT networks can make their way over to the OT network and affect real-world processes. But instead of wreaking havoc on bits, viruses and malware can manipulate atoms. This shift is what drove big acquisitions (Microsoft buying CyberX and ReFirm Labs) and small acquisitions (Deloitte and Accenture buying multiple OT security firms) as IT shops tried to bolster their OT security chops.
Those deals will continue, but we’re going to see a new focus on adding tools that can generate Software Bills of Materials (SBoMs) and new industry verticals that will pay for security. Thanks to an executive order in mid-2021 requiring companies that sell software to the U.S. federal government to document what’s in their code base and make it easy to scan that code base for vulnerabilities, SBoMs are becoming essential for any company.
That means we’ll see more emphasis on visibility in sales pitches as security firms try to offer products that can let customers know what’s on their network and what type of software it runs. For example, Radiflow, an Israeli startup that transitioned from making a networking device to providing OT security by looking at and simulating network traffic, has added a feature that can detect which software devices on the network are running and generate a SBoM.
Ilan Barda, CEO of Radiflow, told me he expects that feature to get more interest as SBoMs become more common. He’s also anticipating a new market opportunity from big IT systems integrators that, a few years back, declined to work with the company based on the belief that the market was too small. But Barda said that now these firms are eager to work with companies like his to offer OT solutions as part of an overall cybersecurity package.
Radiflow has seen growth across the process manufacturing business, which has been fairly attuned to security risks in part because they often deal in dangerous chemicals or foodstuffs where a malfunction could cause explosions or potentially contaminate food or medicines. But Barda said it’s also seeing more interest from companies in the building automation world as companies move to modernize their real estate investments.
It’s not the only one. Honeywell just launched a new cybersecurity product aimed at helping secure building OT networks (see the related news item below). What’s happening is that more buildings are getting networked with sensors and software to help meet sustainability goals or to track people as businesses adopt new policies to deal with COVID.
Broadly speaking, we’re going to see more security investments target the building automation sector as opposed to broad OT or industrial manufacturing. We’re also going to see more tools that help companies understand what code they’re running and where their vulnerabilities are. This is all good news, and I can’t wait for our slightly more secure future.