The Internet is the foundation of much of our economic success today and is an integral part of our daily activity. But the growing threat of cybercrime and cyberwar will have far-reaching effects on Germany’s economic power unless effective defense measures are soon put in place. Already today, according to Klaus-Dieter Fritsche, State Secretary of the Federal Ministry of the Interior, potential damage to information flow could have an annual financial impact in the range of €50 billion.
The rapid development of the Internet since the 1990s has turned cybercrime into a massive problem. Over the last year there were over 246,000 registered criminal offenses committed in Germany via the Internet – a 20% increase as compared to 2009. The most common forms of cyber crime are phishing, account-takeovers, carding and botnets. Various data and statistics on the matter, such as police records and cyber crime reports, attempt to give an accurate overview of the kinds of crimes being committed and the resulting damage. The collected data is often contradictory due to the different methods of data collection being used, not to mention the high number of unreported cases.
In general, however, these reports and studies make one thing clear: small and medium-sized companies known as ‘hidden champions’ are especially vulnerable to cyber attacks, since they do not have the same level of security and protection as major corporations. Given Germany’s status as a leader in innovation, these cyber threats could have fatal consequences for our economy.
In recent years there have been several attacks via the Internet against states and government structures worldwide. Massive attacks from the web have been directed at Estonia in 2007, Georgia in 2008, Kyrgyzstan in 2009 and Iran’s nuclear program in 2010. All of these countries were in a state of conflict with other nations at the time of the attacks. The Internet is now being described as the “fifth military battleground” after land, air, sea and space. All these attacks have the same goal: to bring a country’s social and economic life to a halt as well as significantly damage the economy. The results of these attacks can be devastating and push states, communities and alliances to develop defensive measures against cyber crime.
As a result, the UK has decided to invest over £650 million in the coming years to deal with the issue. The US Department of Defense is also increasing its budget accordingly. An additional $55 million are to be invested in cyber security between now and 2015. In Germany, however, the situation is very different. Despite the growing number of attacks, no additional funds have been made available for security and protection. Although the Cyber Defense Center and the National Cyber Security Council were created in early 2011 to generate more cooperation between different federal agencies, the Defense Center’s ten-member task force will have a difficult time coordinating the decentralized responsibilities of the various cyber security actors and implementing the necessary defense mechanisms.
Defense mechanisms are, however, absolutely critical when one looks at the development of information and communication technologies. The importance of the Internet is growing in all spheres of life. An growing number of companies are using ‘cloud’ services to store their data. There are also new technological advances in power supply such as the so-called smart grid, which allows users to optimize and improve their electricity supply. All of these new approaches lead to the same end result: lower costs for both private and corporate customers.
With the increase in networking in all areas of life comes the danger of growing threats from cyberspace. Therefore it is crucial not only to create effective protection measures, but also for states and businesses to change their current structures. A step in the right direction would be for Germany’s federal government to set up a central cyber protection organization, as the current decentralized structures impede the way to efficient security. The different CERTs (Computer Emergency Response Team) should also be more closely connected. For businesses and the private sector, tighter cooperation with state agencies is both rational and necessary.
The current threat levels are explosive with new larger hacker attacks occurring on a daily basis. Things must change starting today. “Action instead of reaction” should be Germany’s new motto.
Arne Schönbohm is a security expert at Schönbohm Consulting and author of the book “Deutschlands Sicherheit - Cybercrime und Cyberwar” (“Germany’s Security - Cybercrime and Cyberwar”), which breaks down the causes and effects of this negative trend. The book, which includes a foreword by Airbus chief executive Dr. Thomas Enders, puts the concepts of cybercrime and cyber warfare in context and presents a detailed description of the challenges they pose to relevant organizations and bodies in the area of cyber security. The book is rounded out by an analysis of the potential consequences of cybercrime and future actions governments and industries should take.
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