Blog posts by Martin Kuppinger

PSD2 – the EBA’s wise decision to reject Commission amendments on screen scraping

In a response to the EC Commission, the EBA (European Banking Authority) rejected amendments on screen scraping in the PSD2 regulation (Revised Payment Services Directive) that had been pushed by several FInTechs. While it is still the Commission’s place to make the final decision, the statement of the EBA is clear. I fully support the position of the EBA: Screen scraping should be banned in future.

In a “manifesto”, 72 FinTechs had responded to the PSD2 RTS (Regulatory Technical Standards), focusing on the ban of screen scraping or as they named it, “direct access”. In other comments from that FinTech lobby, we can find statements such as “… sharing login details … is perfectly secure”. Nothing could be more wrong. Sharing login details with whomever never ever is perfectly secure.

Screen scraping involves sharing credentials and providing full access to financing services such as online banking to the FinTechs using these technologies. This concept is not new. It is widely used in such FinTech services because there has been a gap in APIs until now. PSD2 will change that, even while we might not end with a standardized API as quickly as we should.

But what is the reasoning of the FinTechs in insisting on screen scraping? The main arguments are that screen scraping is well-established and works well – and that it is secure. The latter obviously is wrong – neither sharing credentials nor injecting credentials into websites can earnestly be considered a secure approach. The other argument, screen scraping being something that works well, also is fundamentally wrong. Screen scraping relies on the target website or application to always have the same structure. Once it changes, the applications (in that case FinTech) accessing these services and websites must be changed as well. Such changes on the target systems might happen without prior notice.

I see two other arguments that FinTech lobby does not raise. One is about liability issues. If a customer gives his credentials to someone else, this is a fundamentally different situation regarding liability then in the structured access via APIs. Just read the terms and conditions of your bank regarding online banking.

The other argument is about limitations. PSD2 request providing APIs for AISP (Account Information Service Providers) and PISP (Payment Initiation Service Providers) – but only for these services. Thus, APIs might be more restrictive than screen scraping.

However, the EBA has very good arguments in favor of getting rid of screen scraping. One of the main targets of PSD2 is a better protection of customers in using online services. That is best achieved by a well-thought-out combination of SCA (Strong Customer Authentication) and defined, limited interfaces for TPPs (Third Party Providers) such as the FinTechs.

Clearly, this means a change for both the technical implementations of FinTech services that rely on screen scraping as, potentially, for the business models and the capabilities provided by these services. When looking at technical implementations, even while there is not yet an established standard API supported by all players, working with APIs is straightforward and far simpler than screen scraping ever can be. If there is not a standard API, work with a layered approach which maps your own, FinTech-internal, API layer to the various variants of the banks out there. There will not be that many variants, because the AISP and PISP services are defined.

Authentication and authorization can be done far better and more convenient to the customer if they are implemented from a customer perspective – I just recently wrote about this.

Yes, that means changes and even restrictions for the FinTechs. But there are good reasons for doing so. EBA is right on their position on screen scraping and hopefully, the EC Commission will finally share the EBA view.

PSD2: Strong Customer Authentication done right

The Revised Payment Services Directive (PSD2), an upcoming EC regulation, will have a massive impact on the Finance Industry. While the changes to the business are primarily based on the newly introduced TPPs (Third Party Providers), which can initiate payments and request access to account information, the rules for strong customer authentication (SCA) are tightened. The target is better protection for customers of financial online services.

Aside from a couple of exemptions such as small transactions below 30 € and the use of non-supervised payment machines, e.g. in parking lots, the basic rule is that 2FA (Two Factor Authentication) becomes mandatory. Under certain circumstances, 1FA combined with RBA (Risk Based Authentication) will continue to be allowed. I have explained various terms in an earlier post.

For the scenarios where 2FA is required, the obvious question is how best to do that. When looking at how banks and other services implemented 2FA (and 1FA) up until now, there is plenty of room for improvement. While many services, such as PayPal, still only mandate 1FA,  there generally is little choice in which 2FA approach to use. Most banks mandate the use of one specific form of 2FA, e.g. relying on out-of-band SMS or a certain type of token.

However, PSD2 will change the play for financial institutions. It will open the fight for the customer: Who will provide the interface to the customer, who will directly interact with the customer? To win in that fight between traditional and new players, customer convenience is a key success factor. And customer convenience starts with the registration as a one-time action and continues with authentication as what the customers must do every time they access the service.

Until now, strong (and not so strong) authentication to financial services seems to have been driven by an inside-out way of thinking. The institutions think about what works best for them: what fits into their infrastructure; what is the cheapest yet compliant approach? For customers, this means that they must use what their service provider offers to them.

But the world is changing. Many users have their devices of choice, many of these with some form of built-in strong authentication. They have their preferred ways of interacting with services. They also want to use a convenient method for authentication. And in the upcoming world with TPPs that can form the new interface, so there will be competition.

Thus, it is about time to think SCA outside-in, from the customer perspective. The obvious solution is to move to Adaptive Authentication, which allows the use of all (PSD2 compliant) forms of 2FA and leaves it to the choice of the customer which he prefers. There must be flexibility for the customer. The technology is available, with platforms that support many, many different types of authenticators and their combinations for 2FA, but also with standards such as the FIDO Alliance standards that provide interoperability with the ever-growing and ever-changing consumer devices in use.

There is room for being both compliant to the SCA requirements of PSD2 and convenient for the customer. But that requires a move to an outside-in thinking, starting with what the customers want – and these many customers never only want one single choice, they want a real choice. Adaptive Authentication thus is a key success factor for doing SCA right in the days of PSD2.

There is no such thing as GDPR compliant software or SaaS solution

Recently, I stumbled about the first marketing campaigns of vendors claiming that they have a “GDPR compliant” application or SaaS offering. GDPR stands for General Data Protection Regulation and is the upcoming EC regulation in that field, which also has an extraterritorial effect, because it applies to every organization doing business with EU residents. Unfortunately, neither SaaS services nor software can be GDPR compliant.

GDPR is a regulation for organizations that regulates how to protect the individual’s PII (Personally Identifiable Information), which includes all data that could potentially be used to identify an individual. Thus, organizations must enforce GDPR compliance, which includes, e.g., implementing the new principles for user consent such as informed and unambiguous consent per purpose; the right to be forgotten; and many other requirements. GDPR also states that software which is used to handle PII must follow the principles of Security by Design (SbD) and Privacy by Design (PbD). Both are rather fuzzy principles, not being formally defined yet.

Thus, a software vendor or SaaS provider could state that he believes he is following the SbD and PbD principles. But that does not make him GDPR compliant. It just builds the foundation for a customer, enabling that organization becoming GDPR compliant. But to put it clearly: An organization dealing with PII can be GDPR compliant. A service provider that acts as “data processor” in the context of GDPR can be GDPR compliant (for its part of the system). But a software application or a SaaS service only can provide the foundation for others to become GDPR compliant. There just is no such thing as GDPR compliant software.

Vendor marketing departments would be well advised to use such terms carefully, because claiming to provide a GDPR compliant offering might make their customers think that they just need to install certain software or turn the key of a turnkey SaaS solution and they are done. Nothing could be more misleading. There is so much more to do for an organization to become GDPR compliant, starting from processes and contracts to using the software or SaaS service the right way. Understanding what GDPR really means to an organization is the first step. KuppingerCole has plenty of information on GDPR.

Don’t hesitate to contact KuppingerCole via sales@kuppingercole.com for our brand-new offering of a GDPR Readiness Assessment, which is a lean approach in understanding where your organization is in your journey towards GDPR compliance and which steps you have to take – beyond just choosing a tool.

Why I Sometimes Wanna Cry About the Irresponsibility and Shortsightedness of C-Level Executives When It Comes to IT Security

WannaCry counts, without any doubt, amongst the most widely publicized cyber-attacks of the year, although this notoriety may not necessarily be fully justified. Still, it has affected hospitals, public transport, and car manufacturing, to name just a few of the examples that became public. In an earlier blog post, I was looking at the role government agencies play. Here I look at businesses.

Let’s look at the facts: The exploit has been known for a while. A patch for the current Windows systems has been out for months, and I’ve seen multiple warnings in the press indicating the urgent need to apply the appropriate patches.

Unfortunately, that didn’t help, as the number of affected organizations around the world has demonstrated. Were those warnings ignored? Or had security teams missed them? Was that ignorance? Lack of established processes? If they had older Windows versions in place in sensitive areas, why haven’t they replaced them earlier? I could ask many more of these questions. Unfortunately, there is only one answer to them: human failure. There is no excuse.

Somewhere in the organizations affected, someone – most likely several people – have failed. Either they’ve failed by not doing IT security right (and we are not talking about the most sophisticated attacks, but simply about having procedures in place to react to security alerts) or by lacking adequate risk management. Or by a lack of sufficient budgets for addressing the most severe security risks. Unfortunately, most organizations still tend to ignore or belittle the risks we are facing.

Yes, there is no 100% security. But we are all supposed to know how to strengthen our cyber-attack resilience by having right people, right processes, and right tools in place. The right people to deal with alerts and incidents. The right processes for both preparing for and reacting to breaches. And the right tools to detect, protect, respond, and recover. Yes, we have a massive skills gap that is not easy to close. But at least to a certain extent, MSSPs (Managed Security Service Providers) are addressing this problem.

Unfortunately, most organizations don’t have enterprise-wide GRC programs covering all risks including IT security risks, and most organizations don’t have the processes defined for an adequate handling of alerts and incidents – to say nothing about having a fully operational CDC (Cyber Defense Center). Having one is a must for large organizations and organizations in critical industries. Others should work with partners or at least have adequate procedures to recover quickly.

Many organizations still rely on a few isolated, old-fashioned IT security tools. Yes, modern tools cost money. But that is not even where the problem starts. It starts with understanding which tools really help mitigating which risks; with selecting the best combination of tools; with having a plan. Alas, I have seen way too few well-thought-out security blueprints so far. Creating such blueprints is not rocket science. It does not require a lot of time. Why are so many organizations lacking these? Having them would allow for targeted investments in security technology that helps, and also for understanding the organizational consequences. Just think about the intersection of IT security and patch management.

To react to security incidents quickly and efficiently, organizations need a CDC staffed with people, having defined processes in place for breach and incident response, and being well integrated into the overall Risk Management processes, as depicted in the picture below.

Such planning not only includes a formal structure of a CDC, but plans for handling emergencies, ensuring business continuity, and communication in cases of breaches. As there is no 100% security, there always will be remaining risks. No problem with that. But these must be known and there must be a plan in place to react in case of an incident.

Attacks like WannaCry pose a massive risk for organizations and their customers - or, in the case of healthcare, patients. This is a duty for the C-level – the CISOs, the CIOs, the CFOs, and the CEOs – to take finally responsibility and start planning for the next such attack in advance.

Why I Sometimes Wanna Cry About the Irresponsibility and Shortsightedness of Government Agencies

Just a few days ago, in my opening keynote at our European Identity & Cloud Conference I talked about the strong urge to move to more advanced security technologies, particularly cognitive security, to close the skill gap we observe in information security, but also to strengthen our resilience towards cyberattacks. The Friday after that keynote, as I was travelling back from the conference, reports about the massive attack caused by the “WannaCry” malware hit the news. A couple of days later, after the dust has settled, it is time for a few thoughts about the consequences. In this post, I look at the role government agencies play in increasing cyber-risks, while I’ll be looking at the mistakes enterprises have made in a separate post.

Let me start with publishing a figure I used in one of my slides. When looking at how attacks are executed, we can distinguish between five phases – which are more towards a “red hot” or a less critical “green” state. At the beginning, the attack is created. Then it starts spreading out and remains undetected for a while – sometimes only shortly, sometimes for years. This is the most critical phase, because the vulnerabilities used by the malware exist, but aren’t sufficiently protected. During that phase, the exploit is called a “zero-day exploit”, a somewhat misleading term because there might be many days until day zero when the exploit attacks. The term refers to the fact that attacks occur from day zero, the day when the vulnerability is detected and countermeasures can start. In earlier years, there was a belief that there are no attacks that start before a vulnerability is discovered – a naïve belief.

Here, phase 3 begins, with the detection of the exploit, analysis, and creation of countermeasures, most commonly hot fixes (that have been tested only a little and usually must be installed manually) and patches (better tested and cleared for automated deployment). From there on, during the phase 4, patches are distributed and applied.

Ideally, there would be no phase 5, but as we all know, many systems are not patched automatically or, for legacy operating systems, no patches are provided at all. This leaves a significant number of systems unpatched, such as in the case of WannaCry. Notably, there were alerts back in March that warned about that specific vulnerability and strongly recommended to patch potentially affected systems immediately.

In fact, for the first two phases we must deal with unknown attack patterns and assume that these exist, but we don’t know about them yet. This is a valid assumption, given that new exploits across all operating systems (yes, also for Linux, MacOS or Android) are detected regularly. Afterwards, the patterns are known and can be addressed.

In that phase, we can search for indicators of known attack patterns. Before we know these, we can only look for anomalies in behavior. But that is a separate topic, which has been hot at this year’s EIC.

So, why do I sometimes wanna cry about the irresponsibility and shortsightedness of government agencies? Because of what they do in phases 1 and 2. The NSA has been accused of having been aware of the exploit for quite a while, without notifying Microsoft and thus without allowing them to create a patch. Government organizations from all over the world know a lot about exploits without informing vendors about them. They even create backdoors to systems and software, which potentially can be used by attackers as well. While there are reasons for that (cyber-defense, running own nation-state attacks, counter-terrorism, etc.), there are also reasons against it. I don’t want to judge their behavior; however, it seems that many government agencies are not sufficiently aware of the consequences of creating their own malware for their purposes, not notifying vendors about exploits, and mandating backdoors in security products. I doubt that the agencies that do so can sufficiently balance their own specific interests with the cyber-risks they cause for the economies of their own and other countries.

There are some obvious risks. The first one is that a lack of notification extends the phase 2 and attacks stay undetected longer. It would be naïve to assume that only one government agency knows about an exploit. It might be well detected by other agencies, friends or enemies. It might also have been detected by cyber-criminals. This gets even worse when governments buy information about exploits from hackers to use it for their own purposes. It would be also naïve to believe that only that hacker has found/will find that exploit or that he will sell that information only once.

As a consequence, the entire economy is put at risk. People might die in hospitals because of such attacks, public transport might break down and so on. Critical infrastructures become more vulnerable.

Creating own malware and requesting backdoors bears the same risks. Malware will be detected sooner or later, and backdoors also might be opened by the bad guys, whoever they are. The former results in new malware that is created based on the initial one, with some modifications. The latter leads to additional vulnerabilities. The challenge is simply that, in contrast with physical attacks, there is little needed to create a new malware based on an existing attack pattern. Once detected, the knowledge about it is freely available and it just takes a decent software developer to create a new strain. In other words, by creating own malware, government agencies create and publicize blueprints for the next attacks – and sooner or later someone will discover such a blueprint and use it. Cyber-risk for all organizations is thus increased.

This is not a new finding. Many people including myself have been hinting about this dilemma for long in publications and presentations. While, being a dilemma, it is not easy to solve, we need at least to have an open debate on this and we need government agencies that work in this field to at least understand the consequences of what they are doing and balance this with the overall public interest. Not easy to do, but we do need to get away from government agencies acting irresponsibly and shortsighted.

The New Role of Privilege Management

Privilege Management or PxM, also referred to by some vendors as Privileged Account Management, Privileged User Management, Privileged Identity Management, or a number of other terms, is changing rapidly, in two areas:

  1. Privilege Management is not only an IAM (Identity & Access Management) topic anymore, but as well a part of Cyber Defense.
  2. The focus of Privilege Management is shifting from session access to session runtime control.

Thus, the requirements for vendors as well as the starting point of product selection is at least getting broader, and sometimes even changing drastically. While password vaults have been at the center of attention for many years, right now session management capabilities such as monitoring, recording, and real-time threat analytics are considered to be the highest priority.

Regarding the first change, you might argue that Privilege Management has always been not only an IAM topic, but more an IT Security issue. This is partially true, particularly in the early days, when the focus was securing administrative access to shared administrative accounts. These initiatives, which existed way before the term "IAM" came up, were driven by IT Security people. However, Privilege Management (protecting accounts and access) over time became an essential element of IAM.

Nowadays, with ever-increasing cyber-attacks, Privilege Management is becoming an increasingly important element of Cyber Defense. While back in the old days internal fraud was the main risk addressed by Privilege Management, it is now about hijacked accounts. The main goal of targeted external attacks is gaining control of privileged accounts. Privilege Management helps in protecting these accounts, analyzing their usage, and detecting anomalies. Thus, Privilege Management is no longer just a part of the IAM domain (where it remains important), but also a vital element of every Cyber Defense strategy and Cyber Defense Center (CDC). While this might be a challenge, when it comes to defining organizational responsibility, it also is an opportunity: Cyber Defense budgets tend to be significantly bigger than IAM budgets.

The second area of change is tightly related to the first one. It is no longer sufficient to just limit access to shared privileged accounts. There are also individual highly privileged accounts – and not even at the IT administrator and operator level, but also business accounts. Thus, it is no surprise seeing the adoption of session management tools in call centers (to protect PII) and other business areas. Furthermore, identifying anomalies and detecting attacks is not done during the authentication to a privileged account, but must happen during runtime.

That does not mean that Shared Account Password Management is no longer relevant. But it is only one of the essential building blocks, with the entire area of session monitoring and anomaly detection massively gaining momentum. Privilege Management strategies and the tool choice decisions must take this change into account.

OpenC2 – Standards for Faster Response to Security Incidents

Recently, I came across a rather new and interesting standardization initiative, driven by the NSA (U.S. National Security Agency) and several industry organizations, both Cyber Defense software vendors and system integrators. OpenC2 names itself “a forum to promote global development and adoption of command and control” and has the following vision:

The OpenC2 Forum defines a language at a level of abstraction that will enable unambiguous command and control of cyber defense technologies. OpenC2 is broad enough to provide flexibility in the implementations of devices and accommodate future products and will have the precision necessary to achieve the desired effect.

The reasoning behind it is that an effective prevention, detection, and immediate response to cyber-attacks requires not only isolated systems, but a network of systems of various types. These functional blocks must be integrated and coordinated, to act in a synchronized manner, and in real-time, upon attacks. Communication between these systems requires standards – and that is what OpenC2 is working on.

This topic aligns well with the Real-Time Security Intelligence, an evolving area of software solutions and managed services KuppingerCole has been analyzing for a few years already. The main software and service offerings in that area are Security Intelligence Platforms (SIP) and Threat Intelligence Services. SIPs provide advanced analytical capabilities for identifying anomalies and attacks, while Threat Intelligence Services deliver information about newly detected incidents and attack vectors.

For moving from prevention (e.g. traditional firewalls) to detection (e.g. SIPs) to response, OpenC2 can play an important role, because it allows taking standardized actions based on a standardized language. This allows, for example, a SIP system to coordinate with firewalls for changing firewall rules, with SDNs (Software Defined Networks) for isolating systems targeted by the attacks, or with other analytical systems for a deeper level of analysis.

OpenC2 thus is a highly interesting initiative that can become an important building block in strengthening cyber defense. I strongly recommend looking at that initiative and, if your organization is among the players that might benefit from such language, actively engaging therein.

Follow-Up on “Managing the User's Consent Life Cycle: Challenges, GDPR Compliance and (Business) Rewards.”

The GDPR continues to be a hot topic for many organizations, especially for those who store and process customer data. A core requirement for compliance to GDPR is the concept of “consent,” which is fairly new for most data controllers. Coming up with GDPR is that parties processing personally identifiable information need to ask the user for his/her consent to do so and let the user revoke that consent any time and as easily as it was given.

During the KuppingerCole webinar held on April 4th, 2017 and supported by iWelcome, several questions from attendees were left unanswered due to the huge number of questions and a lack of time to answer them all.

Several questions centered around the term “Purpose,” which is key for data processing, but a lot more interesting questions came up, which we think are important to follow up here. Corne van Rooij answers some of the questions which couldn’t be answered live during the webinar.

Q: Purpose is related to your business or more generic things like Marketing, User experience Management, Research, etc.?

Corne van Rooij: Purpose is referring to “the purpose of the processing” and should be specific, explicit and legitimate. “Marketing” (or any other generic thing) is not specific enough; it should state what kind of marketing actions, like profiling or specifically tailored offerings.

Q: Is it true that data collection pure for the fulfillment of contractual obligations and selling a product doesn't require consent?

Corne van Rooij: Yes, that is true, however, keep in mind that data minimisation requires you only to collect data you will actually need to use for the fulfillment of the contract. The collection of extra data or ‘future use’ of data that is not mandatory to fulfill the contract does not fall under this and needs additional consent or another legal basis (Article 6) like “compliance with a legal obligation.“

Q: It appears consent is changing from a static to a dynamic concept.  How can a company manage numerous consent request programs and ensure the right consent is requested at the right time and in the right context?

Corne van Rooij: A very good question and remark. Consent needs its own life cycle management, as it will change over time unless your business is very static itself. The application (e.g. the eBusiness portal) should check if the proper consent is in place and trigger for consent if not, or trigger for an update (of consent or scope) if needed. If the consent status ‘travels’ with the user when he accesses the application/service, let’s say in an assertion, then the application/service can easily check and trigger (or ask itself) for consent or scope change. And register the consent back in the central place that had to send the assertion in the first place, so a close loop. Otherwise, the application can/needs to check the consent (API call) before it can act, ask consent if needed, and write it back (API call).

Q: How does the new ePR publish on the 10/1/2017 impact consent?

Corne van Rooij: The document published on 10th January 2017 is a proposal for a new E-Privacy Regulation. If it came into force in the future, it will not impact the implications of GDPR on ‘consent’ and covers other topics (so complementary) that can require consent. This new proposal updates E-Privacy issues in line with market developments and the GDPR and covers topics like cookies and unsolicited communication. It’s the update of an already existing EU Directive that dates back to 2009.

Q: If I understand it well, I can't collect any data for a first-time visitor to an eCommerce website, and I will first have to give him the possibility to identify himself in order to get into the consent flow?

Corne van Rooij: No, this is actually not true. You can collect data, e.g. based on certain types of cookies for which permission is not required (following ePR rules) and that data could be outside GDPR if you can’t trace it back to an actual individual. If you let him/her register himself for e.g. a newsletter and you ask personal information, then it falls under the GDPR. However, you might be able to stay away from asking consent if you can use another legal basis stated in article 6 for lawful processing. Let’s say a person wants to subscribe to an online magazine, then you only need the email address, and as such, that is enough to fulfill “the contract.” If you ask more, e.g. name, telephone number, etc., which you don’t actually need, then you need to use consent and have to specify a legitimate purpose.

Q: For existing user (customer) accounts, is there a requirement in GDPR to cover proof of previously given consent?

Corne van Rooij: You will have to justify that the processing of the personal data you keep is based on one of the grounds of Article 3 “Lawfulness of processing.“ If your legal basis is consent, you will need proof of this consent, and if consent was given in several steps, proof for all these consents have to be in place.

Q: Please give more detailed information on how to handle all already acquired data from customers and users.

Corne van Rooij: In short: companies need to check what personal data they process and have in their possession. They must then delete or destroy the data when legal basis for processing is no longer there, or the purpose for which the data was obtained or created has been fulfilled.

If the legal basis or the purpose has changed, the data subject needs to be informed, and new consent might be necessary.  Also, when proof of earlier given consent is not available, the data subject has to be asked for consent again.

Q: So there is no need to erase already acquired user/customer/consumer data, as long it is not actively used? - E.g. for already provisioned customer data - especially where the use of personal data had been already agreed by accepting agreements before? Is there a need to renew the request for data use when GDPR goes live?

Corne van Rooij: There is a difference in “not actively used” and “no legal basis or allowed the purpose of using it.” If it’s the latter, you need to remove the data or take action to meet the GDPR requirements. The processing which is necessary for the performance of a contract could comply with Article 6, as GDPR is for most of these things not new. There was already a lot of national legislation in place based on the EU Directive which also covers the topic of the lawfulness of processing.

Q: How long are you required to keep the consent information, after the customer has withdrawn all consents and probably isn't even your customer anymore?

Corne van Rooij: We advise that you keep proof of consent for as long as you keep the personal data. This is often long after consent is withdrawn, as companies have legal obligations to keep data under f.i. Business and tax laws.

GDPR as an Opportunity to Build Trusted Relationships with Consumers

During the KuppingerCole webinar run March 16th, 2017, which has been supported by ForgeRock, several questions from attendees were left unanswered due to a huge number of questions and a lack of time to cover them all. Here are answers to questions that couldn’t be answered live during the webinar.

Q: How does two factor authentication play into GDPR regulations?

Karsten Kinast: Two factor authentication does not play into GDPR at all.

Martin Kuppinger: While two factor authentication is not a topic of GDPR, it e.g. plays a major role in another upcoming EU regulation, the PSD2 (revised Payment Services Directive), which applies to electronic payments.

Q: How do you see North American companies adhering to GDPR regulations? Do you think it will take a fine before they start incorporating the regulations into their privacy and security policies?

Eve Maler: As I noted on the webinar itself, from my conversations, these companies are even slower than European companies (granting Martin's point that European companies are far from full awareness yet) to "wake up". It seems like a Y2K phenomenon for our times. We at ForgeRock spend a lot of time working with digital transformation teams, and we find they have much lower awareness vs. risk teams. So, we encourage joint stakeholder conversations so that those experienced in the legal situation and those experienced in A/B testing of user experience flows can get together and do better on building trusted digital relationships!

Karsten Kinast: My experience is, that North American companies are adhering better and preparing more intensely for the upcoming GDPR than companies elsewhere. So, I don’t think it will need fines, because they already started preparing.

Q: Sometimes, there seems being a conflict between the “right to be forgotten” and practical requirements, e.g. for clinical trial data. Can consent override the right to be forgotten?

Karsten Kinast: While there might be a consent, the consent can be revoked. Thus, using consent to override the right to be forgotten will not work in practice.

Q: The fines for violating the GDPR regulations can be massive, up to 20 Mio € or 4% of the annual group revenue, whichever is higher. Can the fines be paid over a period of time or compensated by e.g. trainings?

Karsten Kinast: If the fine is imposed, it commonly will be in cash and in one payment.

Q: Where to learn more on consent life cycle management?

Eve Maler: Here are some resources that may be helpful:

  • My recent talk at RSA on designing a new consent strategy for digital transformation, including a proposal for a new classification system for types of permission
  • Information on the emerging Consent Receipts standard
  • Recent ForgeRock webinar on the general topic of data privacy, sharing more details about our Identity Platform and its capabilities

Martin Kuppinger: From our perspective, this is a both interesting and challenging area. Organizations must find ways to gain consent without losing their customers. This will only work when the value of the service is demonstrated to the customers and consumers. On the other hand, this also bears the opportunity of differentiating from others by demonstrating a good balance between the data collected and the value provided.

Q: Who is actually responsible for trusted digital relationships in the enterprise? Is this an IAM function?

Eve Maler: Many stakeholders in an organization have a role to play in delivering on this goal. IAM has a huge role to play, and I see consumer- and customer-facing identity projects more frequently sitting in digital transformation teams. It's my hope that the relatively new role of Chief Trust Officer will grow out of "just" privacy compliance and external evangelism to add more internal advocacy for transparency and user control.

Martin Kuppinger: It depends of the role of the IAM team in the organization. If it is more the traditional, administration and security focused role, this most commonly will an IAM function. However, the more IAM moves towards an entity that understands itself as a business enabler, closely working with other units such as marketing, the more IAM is positioned to take such central role.

Q: How big a role does consent play in solving privacy challenges overall?

Eve Maler: One way to look at it, GDPR-wise, is that it's just one-sixth of the legal bases for processing personal data, so it's a tiny part -- but we know better, if we remember that we're human beings first and ask what we'd like done if it were us in the user's chair! Another way to look at it is that asking for consent is something of an alternative to one of the other legal bases, "legitimate interests". Trust-destroying mischief could be perpetrated here. With the right consent technology and a comprehensive approach, it should be possible for an enterprise to ask for consent -- offer data sharing opportunities -- and enable consent withdrawal more freely, proving its trustworthiness more easily.

The Role of Artificial Intelligence in Cyber Security

Over the last few weeks I’ve read a lot about the role AI or Artificial Intelligence (or should I better write “Artificial” Intelligence?) will play in Cyber Security. There is no doubt that advanced analytical technologies (frequently subsumed under the AI term), such as pattern matching, machine learning, and many others, are already affecting Cyber Security. However, the emphasis here is on “already”. It would be wrong to say “nothing new under the sun”, given that there is a lot of progress in this space. But it is just as wrong to ignore the evolution of the past couple of years.

At KuppingerCole, we started looking at what we call Real Time Security Intelligence (RTSI) a couple of years back. We published our first report on this topic back in May 2014 and covered the topic in our predictions for 2014. The topic was covered in a session at EIC 2014. And we published a series of blogs on that topic during that year.

There is no doubt that advanced analytical technologies will help organizations in their fight against cyber-attacks, because they help in detecting potential attacks at an earlier stage, as well as enabling the identification of complex attack patterns that span various systems. AI also might help, such as in IBM Watson for Cyber Security, to provide a better understanding of cyber risks by collecting and analyzing both structured and unstructured information. Cognitive Security solutions such as IBM Watson for Cyber Security are part of the AI evolution in the field of cyber-security. But again: The journey started a couple of years ago, and we are just in the very early stages.

So why this hype now? Maybe it is because of achieving a critical mass of solutions. More and more companies have entered the field in recent years. Maybe it is because of some big players actively entering that market. At the beginning, most of the players were startups (and many of these rooted in Israel). Now, large companies such as IBM have started pushing the topic, gaining far more awareness in public. Maybe it is because of AI in Cyber Security being the last hope for a solution that helps the good guys win in their fight against cyber criminals and nation-state attackers (hard to say where the one ends and the other starts).

Anyway: We will see not only more solutions in the market and advancements in that field of technology in 2017 and beyond, but we will see a strong increase in awareness for “AI in Cyber Security” as well as the field of Real Time Security Intelligence. This is, regardless of all skepticism regarding the use of terms and regarding hypes, a positive evolution.

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