THE AI HYPE
According to Statista, the global AI market is predicted to exceed $800 billion by 2030. On our little island, the market is currently worth £4.5 billion, projected to be £20 billion by the end of the decade. To put this in context, AI could easily be worth more than the GDP of Sweden, Ireland or Singapore, and three times the GDP of smaller economies such as Greece and New Zealand. But will AI become another underwhelming hype like the Dotcom businesses, RSS feeds and 3D Printing of years gone by? In June, Reuters Institute and Oxford University published a report which showed that only 2% of the population use ChatGPT frequently in the UK. On the plus side, Gen Z has bought into the technology, with 56% of people aged between 18 and 24 saying they’ve used Open AI’s brainchild at least once. According to tech critic, Paris Marx:
“This whole AI cycle was fuelled by fantasies, and when people stop falling for them the bubble starts to deflate.”
WILL THE BUBBLE BURST?
In a recent article for The Guardian, John Naughton, Professor of the Public Understanding of Technology at the Open University, outlined the five stages of financial bubbles, suggesting that AI currently sits between stages three and four: euphoria and profit-taking. Despite tech giants like Microsoft and Google continuing to invest heavily to sustain the hype, it’s becoming clear that astute investors are recognising the signs and preparing to exit, if they haven't already started, to avoid significant losses. Just last week, American chip giant Nvidia lost 10% on the Nasdaq, wiping $300 billion off its stock market valuation. The reason? Investors are no longer enamoured by the boom in AI. Back to Naughton’s fifth stage – panic. Is that where we are headed? The big sellout? Naughton says:
“It could be that governments eventually tire of having uncontrollable corporate behemoths running loose with investors’ money. Or that shareholders come to the same conclusion. Or that it finally dawns on us that AI technology is an environmental disaster in the making; the planet cannot be paved with data centres. Nothing grows exponentially forever. So, going back to that original question: are we caught in an AI bubble? Is the Pope a Catholic?”
AI AND CYBERSECURITY
We can speculate on the longevity of the AI hype. It’s highly unlikely that this digital technology will disappear although we might witness the emergence of a generative AI winter. What cannot be ignored is the role AI has to play in cybersecurity and investment therein. While board members and CISOs may toss and turn at night contemplating the optimal investment level in AI, the fact remains that against the backdrop of rapid technological advancements and ever-evolving threats, investments need to be made. According to Professor Raj Rajarajan, a cybersecurity leader and a director at Cyber London:
“For companies, the core technology focus areas for investment should be around defensive AI, identity management and automation of threat intelligence.”
Raj’s words are accentuated by the findings of a 2024 report by CNBC. 60% of companies regard generative AI as critical to their business operations, making it the largest technology spending priority for 44% of organisations in the coming year. This underscores the growing significance of AI, particularly within cybersecurity budgets, and highlights the need for strategic investment in areas with the potential for the greatest impact. It also emphasises the importance of tracking the returns on these investments.
WHAT CAN AI OFFER?
To invest strategically, board members need to understand the potential opportunities AI can bring to their organisation. A survey by Forbes Adviser of 600 companies identified the key areas where AI delivers the most benefit:
Over half of business owners utilise Artificial Intelligence for cybersecurity and fraud management.
97% believe ChatGPT will benefit their business: one in three plan to use ChatGPT for website content creation, while 44% intend to use it for writing content in other languages.
46% use AI to draft internal communications.
64% believe AI will enhance customer relationships.
RETURN ON INVESTMENT
The long-term benefits of strategic investments in AI and cybersecurity are extensive, as highlighted in the CompTIA IT Industry Outlook 2024, which notes improvements in operational efficiency, enhanced customer trust and loyalty, reduced downtime, and competitive advantages through stronger data protection. These investments also enable organisations to innovate and adopt new technologies more safely and securely. Developing a comprehensive AI and cybersecurity investment strategy is essential for maximising both short- and long-term ROI, ensuring that security enhancements align with broader organisational goals and create a synergy between security measures and business growth.
RSA CONFERENCE 2024
At the annual RSA Conference in San Francisco in May, there was much more than hype about generative AI. The buzz focussed on cybersecurity investments, AI-based defence and AI-delivered industry models. RSA also highlighted the increase in AI attacks as more companies onboard AI models. AI adoption is actually driving a surge in efforts to protect AI models and the data they are trained on. CISOs are increasingly concerned about data contamination, data leakage, and the threat of attackers stealing or compromising AI models. This has become a primary concern, with a wide range of companies, both established and start-ups, developing firewalls and defences around AI models. Concerns over AI-driven attacks are also prompting organisations to strengthen their security measures. In one presentation, a senior vice president at Akamai, an American cloud-computing and security company, highlighted a 48% rise in web attacks over the previous year, with almost 30% targeting organisations’ APIs. While companies are leveraging AI and machine learning to detect and prevent cyber threats in real-time, cybercriminals are using AI tools to create deepfakes, steal user passwords, and employ other fraudulent methods to evade security systems. Several discussions emphasised the need for CISOs, CTOs, and CIOs to adopt AI-driven cybersecurity solutions or risk being outmanoeuvred by cybercriminals who are already using these technologies to launch attacks. Rick Grinnell, a venture capitalist focused on AI-enabled software, reflected on his time at RSA 2024 and said:
“The industry has renewed confidence, and many innovative AI cybersecurity solutions are ready to battle today’s increased security challenges. For CISOs, the messages were clear. Prioritise security across every aspect, encompassing data protection, AI model security, and, crucially, identity safeguarding. A breach in identity could render all other defences futile. Embrace automation within your security operations centres and introduce novel barriers to thwart cyber adversaries, fortifying your enterprise’s resilience against evolving threats.”
Forgetting the hype and the enormous market potential for the moment, in the game of AI cat and mouse, where bad actors are using the same AI tools to launch attacks, it’s always better to be safe than sorry. Put simply, investment around defensive AI is a cybersecurity must.
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