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Data Sheet―Saturday, February 18, 2017


What a week. Five go-go days and nights at the RSA conference in San Francisco showed why cyber-security is the biggest story in tech right now as businesses scramble to secure a leaky, hack-riddled Internet―and cyber firms jockey to sign them up for fat contracts.

The week had hoopla aplenty, including a performance by rapper Snoop Dogg that crowned network security firm ForeScout as the winner of RSA's best party. Meanwhile, a sales guy read my "Fortune" badge as "FortLine," prompting my colleague Robert Hackett to suggest we launch a cyber startup of that name ("FortLine: perimeter defense in the cloud!"). I'm sure someone would fund it.

But beneath the fun lurked the question of when this money merry-go-round will stop, and which cyber winners and losers will emerge. Bill Phelps, an EVP at Booz Allan, believes there are too many companies doing the same thing, and many just aren't pulling in revenue to justify their valuations. If he's right, a winnowing is on the way.

Phelps also identified what he calls "security supermarkets" as likely losers in the cyber market. These are big companies like or HP or Intel or FireEye, which acquire a mish-mash of smaller security firms, but fail to integrate them into a single platform. The result is a big bucket of products that don't play well together―and annoy their customers. Meanwhile, Phelps sees newer names like end-point provider Tanium , which are building platforms around their core key product, as better poised to win.

But if there was a single winner this week, it was RSA itself and its owner EMC . Long-time attendees said they are agog at what has become of the conference, which began as a small confab of cryptographers, and then shuffled along for years in modest settings in San Jose. Today, booths at RSA can cost hundreds of thousands of dollars, and the overall extravaganza swallows up a large part of San Francisco. It this isn't peak-cyber, I don't know what is.

Thanks for reading―more security tidbits below.

Jeff John Roberts



Welcome to the Cyber Saturday edition of Data Sheet, Fortune' s daily tech newsletter. You can reach Robert Hackett via Twitter , Cryptocat , Jabber (see OTR fingerprint on my about.me ), PGP encrypted email (see public key on my Keybase.io ), Wickr , Signal , or however you (securely) prefer. Feedback welcome.


Republicans too quick toConfide:A passel of "paranoid" GOP staffers are turning to a disappearing messaging app called Confide. The little-known app, which has been around for a while, touts its "military grade encryption." But a look under the hood of Confide suggests there's no such thing and the whole app is "marketing over substance." ( CyberScoop , Fortune )

Ra-Ra Rasputin returns: A hacker named Rasputin, who peddled exploits for the websiteof a U.S. election agency is branching out. He's now sellingvulnerabilities for the sites of dozens of well-known universities and for a host of state and local governments. ( Fortune )

Beware the stupid: The head of Cisco's security team doesn't buy into fears of artificial intelligence making machines too smart for our own good. Instead, he's worried aboutthe problem of "artificial stupidity"that can arise whencybersecurity companies fail to help customers connect and configure their network defense. ( Fortune )

Ahackingdiscount at Yahoo: Verizon will reportedly get to shave about $250 million off the purchase price of Yahoo as the companies wrap up an investigation into a catastrophic series of hacks. They will also reportedly share the cost of whatever legal fallout comes fromall this. ( Bloomberg , Fortune )

And Homeland Security, what's with the stacks of DVDs at your RSA booth?

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Fortune's Robert Hackett chatted with former chair of the House Intelligence Committee, Mike Rogers, about security, Mike Flynn and cyber:

Rogers said a major event could come in the form of a country taking down a U.S. bank, and said there are already extensive discussions in security circles over whether this would amount to an act of war on the country.

He also wryly pointed out another potential worry. "Imagine 50 million Starbucks apps suddenly don’t work. Can you imagine 50 million un-caffeinated Americans? That’s a serious threat." Read more on Fortune.com .


New GOP"Tech Agenda" would help firms with EU datalaw by Jeff John Roberts

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