DUBAI, UAE — At US$4.4 billion, the second quarter of 2022 saw a 32 percent decrease in global cybersecurity spending. Mega-round ($100 million+) investment fell 46 percent QoQ to $1.9 billion. This is the first time the total has dropped below 50% since 2020, according to CB Insights research.
The percentage of deals at the early stage of development hit 60 percent, the highest level in two years, reflecting broader trends in the venture market.
As businesses readjusted to more challenging public market conditions, the number of merger and acquisition (M&A) agreements, including cybersecurity, decreased 16 percent QoQ to 26.
However, as the number of cybersecurity unicorns rises, the overall rate of unicorn births has dropped by 27 percent QoQ. With these eight additions, the overall number of cybersecurity unicorns now stands at 74, with the United States home to 72.
Businesses
Netskope’s Vice President for Middle East and Africa Jonathan Mepsted said that 2022 ended with “a rising trend of Ransomware-as-a-Service, and anticipate the potential for Extortion-as-a-Service models to become more common.”
“Phishing operations will increase in sophistication to bypass multi-factor authentication (MFA),”; mainly in the GCC region,” he told TRENDS during an interview.
As for trends in business operations, Mepsted stated that disruption is the “new normal” for businesses globally.
That’s why experts stress the importance of companies being proactive in their defenses against the ever-changing nature of online threats. The confidence and data security provided by cyber defenses are essential for organizations to maintain operations and minimize downtime, according to Mepsted.
Economies
As for economies, especially GCC countries, Mepsted said that cybersecurity should not be considered a limiting lever. It shouldn’t be about restrictions.
With a solid cyber defense, businesses are less likely to be hindered from expanding their operations in exciting new directions, such as entering new markets or expanding through mergers and acquisitions.
“Suppose your data is secure and your processes are sound. In that case, you can innovate in how you collaborate with partners, introduce machine learning and AI, and embrace new approaches to the industry”, says Mepsted.
The GCC countries have responded to the threat of cyberattacks by investing heavily in strengthening their cybersecurity infrastructure.
GCC’s response to cyber threats
New cybersecurity legislation and strategies and amendment of existing ones; development of education, policy, and regulation in vulnerable sectors and at the national level; improvement of international cooperation; and establishment of regional cybersecurity institutions like the Permanent Committee on Cyber Security in the GCC are all considerable efforts in developing the sector in the region.
Fraud, identity theft, data breaches, copyright infringements, privacy violations, and many more threats emerge in the rapidly evolving digital economy. The industry dedicated to shielding businesses from such dangers is substantial in its own right. Some estimates put the Middle Eastern cybersecurity market at more than US$ 28 billion by 2025, up from an anticipated US$ 16 billion in 2020. Leading the GCC, the Saudi government is expected to spend US$ 2 billion annually on cybersecurity, with digitalization growing at a rate of 12 percent per year and the cybersecurity industry growing at a rate of 15 percent per year. The Saudi Vision 2030 calls for an 80 percent digitalization of all government agencies.