IBM’s security business up 10 percent, powered by Watson

On the IBM Q1 2017 Earnings Conference Call earlier this week, Martin Schroeter, senior vice president and chief financial officer for the tech giant, reported that security revenues were up 10 percent.

IBM generates more than $2 billion in security revenues annually, which puts them head-to-head with Cisco’s security group for the title of world’s largest enterprise IT security business.

CSO checked in with Marc van Zadelhoff, general manager at IBM Security – one of IBM’s four strategic areas (cloud, analytics, and mobile being the other three) – for a deeper dive into its security initiatives.

“We provide a unique, immune-system-like approach to security, with Watson’s cognitive capabilities at its core, and services partners who can make it happen which is differentiating us in the market and driving our growth to outpace the market” says van Zadelhoff. It was only a year ago when IBM announced that they would be bringing Watson to security.

Outpacing the market would be an understatement, considering IBM’s security business is up 10 percent in one quarter, compared with the overall market which is growing by 12 to 15 percent year-over-year.

There are five key drivers behind IBM’s security business, which explain the growth.

Watson

“Since its launch a month ago, more than 50 global clients are using Watson to power their cognitive Security Operations Centers” says Van Zadelhoff. “The results are astounding – Watson found threats 60x faster than manual investigations; complex analysis went from 1 hour to less than 1 minute; and Watson added 10x more actionable insights to uncover new threats. We’re adding AI (artificial intelligence) across the (security) portfolio.

Recruiting

While Watson is its star pupil, IBM Security has been hiring cyber personnel at a rapid clip in a market suffering through a severe talent shortage. “Nearly 2,000 additional experts have joined our security business, including world-class developers, consultants, and research professionals over the last few years” says Van Zadelhoff. There’s 1 million cybersecurity job openings in 2017, and that number is expected to grow substantially over the next couple of years.

Cloud

“We’ve delivered innovative technologies that help our clients move securely to the cloud,” says Van Zadelhoff. “QRadar. Watson. BigFix Detect. AppScan. IDaaS. Mobile Management. Fraud Protection. All are available ‘as a Service.’ So we’re giving customers a path to security on the cloud and have become a huge SaaS provider.” IBM’s cloud offerings were up 35 percent in the quarter.

Partners

“Over 30,000 apps have been downloaded since the launch of the IBM Security App Exchange, allowing users to easily extend the capabilities of IBM’s Security technologies with custom apps and integrations built by hundreds of partners,” says van Zadelhoff. “Also over 20,000 searches a day are happening on X-Force Exchange where we house our threat portal and APIs.”

IR

“In November, we announced a major expansion of our incident response capabilities, including new facilities, services and software as part of a $200 million investment,” says van Zadelhoff. “We launched the first live cyber-range for the private sector as well as our IRIS team – all building on our acquisition of Resilient Systems last year. “We’re the first large vendor to focus on incident response as a platform and as a service.”

The cybersecurity market is expected to generate $1 trillion in spending on products and services over the next five years, from 2017 to 2021. Expect IBM to take a big bite out of that.