{"id":42009,"date":"2013-09-16T02:19:38","date_gmt":"2013-09-16T06:19:38","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=42009"},"modified":"2013-09-16T02:19:38","modified_gmt":"2013-09-16T06:19:38","slug":"why-cyberwarfare-has-become-big-business","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/09\/16\/why-cyberwarfare-has-become-big-business\/","title":{"rendered":"Why Cyberwarfare Has Become Big Business"},"content":{"rendered":"

By MoneyMorning.com.au<\/u><\/a> <\/p>\n

There are undeclared wars going on all over the world today.<\/p>\n

No, I\u2019m not talking about simple border disputes in Africa or ongoing operations in Afghanistan. You won\u2019t hear about these wars on the news, though some of the world\u2019s leading countries are involved. In fact, it\u2019s very likely that the US is involved in at least one of these \u2018wars\u2019 right now.<\/p>\n

That\u2019s because these conflicts are operating in the fifth domain of war: cyberspace \u2014 the latest battlefield after land, sea, air and space. I\u2019ve noted in these pages before \u2014 war isn\u2019t strictly kinetic anymore. The limit of an army\u2019s reach is no longer the range of its biggest gun \u2014 a navy\u2019s striking range is no longer measured in the miles its missiles can fly.<\/p>\n

In the fifth domain of war, invisible signals race back and forth through wires and circuitry in an attempt to gain information or disable key systems. Professionals in the cyberwarfare business<\/strong> often refer to these programs as \u2018computer network operations\u2019, or CNOs, for short. And there are more \u2018cyberwarriors\u2019 each year.<\/p>\n

Descriptions of cyberwar read more like science fiction than the annals of military history: Offensives jump off at the stroke of a key. The sentries are firewalls, encryptions and passwords. Viruses drop behind enemy lines like guerillas and sow confusion.<\/p>\n

It\u2019s a whole new way to wage war, and one that some predict will dominate international relations in coming decades. In fact, the increasing importance of cyberwarfare could well shake up the existing balance of military power around the globe.<\/p>\n

How can politicians and generals resist? With plausible deniability, it\u2019s as close to war without risk as the military can get. Need to shut down a rival country\u2019s secret weapons program but can\u2019t penetrate their airspace undetected? Drop a virus instead of a bomb! That\u2019s the kind of option policymakers and warriors have on the table now. It\u2019s a whole new ballgame.<\/p>\n

Indeed, some experts say the wars of the future will be fought only with special forces operators and computer programmers. However, until we figure out a way to profit from the Navy SEALs, I\u2019ll stick to talking about the latter \u2014 cyberwarfare and the profit opportunities it gives you, the investor.<\/p>\n

Cyberwarfare is a $55 billion industry. It\u2019s also America\u2019s fastest-growing industry, set to double in the next 12 months. One recent study characterised cyberwarfare as \u2018the ultimate asymmetric weapon\u2019 \u2014 I like \u2018the fifth domain of war\u2019 better.<\/p>\n

One of the biggest challenges that emerges in taking war to the fifth domain is that cyberwarfare capabilities offer a powerful and immediate force multiplier for rogue states. Countries that previously posed little threat when judged by conventional military standards, such as Iran, now pose much larger ones. This is a huge shift: Remember, Iran doesn\u2019t possess adequate conventional military force to directly challenge its regional enemies Iraq and Israel, let alone global enemies like the United States.<\/p>\n

Iran\u2019s conventional military doesn\u2019t rank in the world\u2019s top 10. Despite having more than a million men under arms and several thousand armoured fighting vehicles and combat aircraft, it\u2019s doubtful that it could survive a conventional war. In fact, it barely did against Saddam Hussein\u2019s forces in the 1980s, which were in turn smashed by NATO forces in one of the shortest wars in modern history.<\/p>\n

Yet a recent cyberwarfare study by the Atlantic Council, a beltway think tank, classified Iran as a tier-three cybermilitary. That means it\u2019s capable of causing significant harm to civilian networks within the US, if not in the government.<\/p>\n

What a jump in capabilities for this fourth-rate military power halfway across the world! On its best day, Iran could hardly hope to sink a single US Navy warship, but with its growing cyberwarfare capability, suddenly it\u2019s a real threat.<\/p>\n

But the practical anonymity that makes cyberwarfare the perfect way for rogue states to attack the US and its allies also makes it the perfect weapon for democratic countries too. Now, without a mandate for \u2018boots on the ground\u2019 warfare or UN approval, they can launch pre-emptive or retaliatory strikes against these threats. They go from being front-page news to wink, wink, nod, nod.<\/p>\n

Most recently, it\u2019s become known that the destruction of Iran\u2019s latest nuclear testing facility was carried out in the fifth domain by a virus call \u2018Stuxnet\u2019, reputed to be a joint operation between the United States\u2019 NSA and CIA and Israel\u2019s military. This was the first time a virus did significant physical damage to a military facility.<\/p>\n

We should expect to see more of this type of attack in the event that a \u2018cold\u2019 cyberwar heats up. In fact, recent developments have increased the likelihood we will. I\u2019m talking about the Pentagon\u2019s black budget. If you haven\u2019t heard about the black budget, that\u2019s because it\u2019s normally been talked about behind closed doors\u2026until now.<\/p>\n

Just this month, The Washington Post<\/i> released information it received from the renegade whistle-blower Edward Snowden<\/a> about the US intelligence community\u2019s funding for secret projects. It\u2019s been dubbed the \u2018black budget\u2019. What they found was startling.<\/p>\n

The 178-page report they received details exactly how the intel budget will be portioned out \u2014 I\u2019m talking the who, what, when, where, etc. In case this isn\u2019t clear: This information has never \u2014 I repeat, never \u2014 been made public before! At least it\u2019s never been intentionally made public before.<\/p>\n

The last glimpse the public got into this shadow world was in 1994 when a congressional committee accidentally released a detailed budget to the press. Using that as the last known benchmark, the changes made over the last two decades reveal a seismic shift in the 16 US intelligence agencies\u2019 priorities, their pecking order and a lot about the US military-political strategy as a whole. Let\u2019s focus on two points.<\/p>\n

The CIA \u2014 the spearhead of intel \u2018offensives\u2019 overseas \u2014 which received just 11% of intel money in 1994, will receive a whopping 28% of the \u2018black budget\u2019 in the next fiscal year! That\u2019s even more than what the NSA will get.<\/p>\n<\/p>\n

\"a\"<\/a><\/p>\n

Click to enlarge<\/em><\/a>\n<\/p>\n

Looked at this way, it\u2019s a shift from defense to offense. With terrorists harder to find than ever and rogue states to worry about, we\u2019re in cyber \u2018seek and destroy\u2019 mode now. That\u2019s my second point: Cyberwar is where funding is shifting to.<\/p>\n

In fact, cyberwarfare-related activities will receive more than $4.2 billion, according to the Post\u2019s breakdown. That\u2019s nearly 10% of the whole intelligence community\u2019s budget! My, how times have changed from the early days of the internet.<\/p>\n

The bottom line is that our military planners see the next big threat coming in the form of an attack on the computers that run our country, and they\u2019re preparing. These revelations can and should move markets\u2026 At least if you\u2019re paying attention.<\/p>\n

That\u2019s because when the government wants to expand its cybersecurity programs, develop new capabilities or shore up its networks\u2019 defenses, it relies on private cybersecurity companies to do most of the heavy lifting. They\u2019ve got \u2018the right stuff\u2019, to borrow a phrase, and they\u2019re for hire.<\/p>\n

Byron King<\/strong>
\n Contributing Editor, Money Morning<\/em> <\/strong><\/p>\n

Ed Note:<\/strong> How to Invest During the ‘Forever War’<\/a> originally appeared in The Daily Reckoning USA. <\/em><\/p>\n

Join Money Morning on Google+ <\/u><\/a><\/strong><\/p>\n

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<\/p>\n","protected":false},"excerpt":{"rendered":"

By MoneyMorning.com.au There are undeclared wars going on all over the world today. No, I\u2019m not talking about simple border disputes in Africa or ongoing operations in Afghanistan. You won\u2019t hear about these wars on the news, though some of the world\u2019s leading countries are involved. In fact, it\u2019s very likely that the US is … <\/p>\n

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