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With rise of big data, never say never again
Kim Philby is considered to be one of the greatest spies in the last century
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im Philby is considered to be one of the greatest spies in the last century. From working for the MI-6 to becoming the liaison officer between the British and United States’ intelligence services — when he was really a double-agent for the Soviet, displayed a remarkable skill even by the lofty standards of Cold War espionage.
His leak to the USSR about the British plan to send armed anti-communist bands into Albania in 1950 ensured the Soviets were ready to crush it. The very fact that he leaked sensitive information for almost two decades undetected reflects Philby’s greatness in the field. Even Joseph Stalin was cautious about him fearing that he may be a triple agent providing Soviet intelligence to the British.
Spy games have been waged since the beginning of time. Until a few decades ago it revolved primarily around human intelligence with key players being killed or kidnapped. Then came the electronic battles with the countries using computer worms to infect key assets like the US did with Iran’s nuclear program.
The most rampant one lately has been the case of China looking to steal US technology in sectors like defense or aerospace. At the corporate level theft has existed for long as well — a popular example laid out by Richard Branson in his book Dirty Tricks wherein he highlights the games played by British Airways to damage the then emerging Virgin airline.
The latest stage has come with corporations using professional spies. It is not an accident that the giant private equity firm, Kohlberg Kravis Roberts, recruited the former CIA director, General David Petraeus, as the chairman of its KKR Global Institute. Petraeus has had a glorious career of 37 years in the military but it’s naïve to believe that he was pursued and hired only for his military genius.
The next level of espionage will be even more brutal. As the battle for the seas, air and land get more complex — the biggest war is likely to be in cyber space with hackers and agents coming into high prominence. Two drastic changes have occurred in the past decade that make hacking and espionage even more tempting.
The first is the increase in innovation levels by technology companies. After a shallow first decade wherein banks dominated wealth creation through their over-rated innovation of financial products, this decade has seen some serious innovation across industries.
In a scenario wherein a lone competitor makes a breakthrough in technology, it is incumbent for the rest to develop its own or find ways to get the same. 85 percent of cyber espionage cases reported in the US is for theft of trade secrets.
A current example is of Uber being sued by Alphabet’s Waymo for stealing trade secrets pertaining to developing its own autonomous vehicle. Given the disruptive potential that autonomous vehicles can possibly have — it is suicidal for companies to not go for it. Surveys indicate that 80 percent of US businesses and IT companies rate cyber-security among the top 3 threats facing organizations today.
The bigger battle however will be played on the espionage pertaining to Big Data. Never in the history of mankind has the quantum of data been generated so huge and processed in the structured manner that it is today. It is this data that is causing valuations of many tech companies to swoon into handsome billions.
While US giants like Apple, Facebook, Alphabet etc take the limelight, Chinese early stage companies backed by their own local heavyweights are commanding tremendous interest.
Developed markets are waking up to the challenge of being digital.
Mobile banks like MyBank and WeBank, backed by Alibaba and Tencent, have seen valuations surge as they penetrate into the unbanked segment of China on the back of Big Data. Unlike the giant Standard Oil which was broken up when the US Supreme Court ruled that it was an illegal monopoly, the tech and data giants today are no such threat.
Yet vast amount of data in a small list of companies is risky and administrators across the globe need to cautiously monitor these companies. Penetration in databases of social media platform Facebook or credit agency Equifax display the lucrative benefits that players see in processed and almost real-time data. Facebook gets almost 98 percent of its revenues from advertising and Twitter gets 86 percent of its revenues from advertising as advertisers recognize that targeting of the audience happens best through these platforms.
In most of these platforms, the user is the product and not the consumer. Emerging markets like Indonesia, Philippines, Vietnam are yet building their digital footprint given their late arrival on the scene but they must take grasp the late-mover advantage by learning from developed markets. Developed markets are waking up to the challenge of being digital.
Unsurprisingly the effort on legislation and regulation is being led by the most digital country on the planet — Estonia where 99 percent of public services are available to citizens as e-services. The country had been hit by a massive cyber-attack on its parliament, banks, media in 2007 — blamed on Russia.
Since then Estonia has made its systems more stringent and relations with Russia have improved with the two countries even swapping two convicted spies earlier this year. That may provide respite but does not mean the system is impenetrable. That is the reason why hacking and espionage along with its defense will only rise over the coming years. The biggest shortage for talent in today’s major economies is cyber security professionals according to IT governance association — ISACA.
When revealed by Anatoliy Golitsyn who defected from the KGB to the CIA that Philby was indeed a Soviet double agent — his friend Nicholas Elliott, a MI-6 officer, was sent to extract a full confession in 1961. Philby confessed to the charges of espionage but delayed writing a statement to that effect.
Like most of the best agents, Philby had a lonely and miserable death in 1988 in Moscow. Perhaps no spy has matched his greatness since. As cyberwar heats up, big data will be a potent edge. James Bond maybe glamorous but to win companies and countries will need their own Kim Philby who will also be behind a computer screen.
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The writer is vice president for strategy at Cogencis Information Services Ltd., Mumbai, India.
