Mid-Year Review 2015 with Finjan Holdings, Inc. (NASDAQ: FNJN) on SNNLive
Phil speaks very well, cutting through much of the jargon that surrounds the cybersecurity industry. He speaks a bit about the business’ transition from being a product and technology company selling hardware and software, into being an IP licensing company, and the reasons for transitioning now into a services provider.
Around 4:10, Phil brings up a great point that isn’t often spoken about: There has been and is currently a question of fiduciary duty surrounding enterprise level digital security breaches. Recently in the United Kingdom Columbia Casualty Company has sued one of its policyholders, Cottage Healthcare System, for the return of a $4.1 million settlement paid out to the Cottage clients who were the owners of the compromised data. Columbia alleges that Cottage’s networks weren’t being secured properly and the inference is that the company was using insurance in the place of proper security. Ultimately, there is a responsibility at the board level in organizations to show due care and attention to their networks and ensure they’re secure. Cyber breach liability being a relatively new field, the scope of due care and attention is in the process of being defined.
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Phil aptly uses the example of the Target breach to demonstrate the market opportunity available in data protection. The Target breach was a theft of customer credit card data orchestrated at point of service terminals, and the company is widely considered to have gotten off easy with a $162M cost. Phil could be accused of modesty for not going straight for Sony, the IRS or the still developing US Gov’t Office of Personnel Management hack. In all of those cases, the smoke is going to clear and the people responsible for the organizations are going to have to answer questions about what they were doing to make sure their networks were secure and remained secure.