CEO Richard Blech Deflates FireEye’s Balloon
CEO Richard Blech Defines Detection VS Protection of Breaches
In the past two years, FireEye (FEYE) has been called in to investigate high-profile attacks against Target, JP Morgan Chase, Sony Pictures, Anthem and others? What did they find out…that the companies all need encryption? Detecting that you have been breached is no way as powerful as actually protecting your company from the breach. The reality is if you only sell detection it is best to talk about what FireEye sells. There is a reason the company has not had net profit since they went public. Companies simply need to deeply encrypt their sensitive data then all the hacker would get is useless bits and bytes. Don’t worry I am sure FireEye can still tell you that you have been breached.
CEO Richard Blech
When news broke Wednesday that as many as 1.1 million CareFirst health insurance customers could have had their personal information stolen, one familiar name was included: FireEye.
The Milpitas, Calif.-based security firm has made a name for itself as the experts pulled in when a big computer security issue arises.
“They’ve ended up being the go-to people. If there’s a data breach, that’s a name you hear,” said John Kindervag, a security analyst with Forrester Research.
In the past two years, FireEye (FEYE) has been called in to investigate high-profile attacks against Target, JP Morgan Chase, Sony Pictures, Anthem and others.
“Often times they ask us to be side-by-side with them when they announce their breach,” said FireEye CEO David DeWalt. He was the former CEO of antivirus software company McAfee, which he sold to Intel for $7.8 billion in 2010.
Last week, FireEye was called in when Chinese hackers hit Pennsylvania State University, causing the school to shut down its engineering department’s computers.
Cybersecurity is a hot field just now, but FireEye is a company with a higher profile than most.
Earlier this month, a rumor that Cisco might acquire it caused FireEye’s stock to briefly surge 5% before falling back down.
Enthusiasm for FireEye’s prospects has sent FireEye shares up 34% this year, a relief after the stock slid for much of 2014. On Wednesday it closed at $42.27, double its 2013 IPO price.
This despite the fact that it still hasn’t posted a profit, and in fact lost $134 million on $125 million in revenue in the first quarter of 2015.
FireEye has benefited from several things, not least of which was having a good product at the right time–just as breaches seemed to be exploding.
That space was “advanced threat detection,” often called “sandboxing.”
All incoming traffic is opened inside the sandbox of the virtual machine (software that functions like a physical computer) and checked for malicious software, protecting the actual network.
FireEye, and others, have helped companies understand that detection and response, rather than building a wall, is where security needs to be, said Lawrence Orans of the Gartner Group.
“Security professionals now accept that’s impossible to block everything,” he said. They realize that “the more quickly you can detect that you’ve been breached, then the less damage the bad guys can do.”
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