BalaBit and KPMG Release New Market Research on IT Security Compliance for Cloud Service Providers

NEW YORK, NY--(Marketwired - Sep 30, 2014) - BalaBit, an IT security innovator specializing in log management and advanced monitoring technologies, and KPMG in Hungary have released the results of a jointly conducted international market survey entitled "Compliance in the IT Service Provider Sector." 

Compliance with increasingly stringent regulations for cloud service providers (CSPS) -- and organizations providing outsourced IT services -- particularly in regards to data protection, is becoming more and more difficult. Reputation and client trust are fragile assets, and compliance with industry standards and legal regulations is essential to earn and maintain them.

"Cloud service providers consider compliance a magical term. On the one hand it's critical to their success, on the other hand it imposes time-consuming burdens on the business," said Sándor Biczók, IT Risk Advisor at KPMG in Hungary.

Approximately 60 percent of service providers spend more than 10% of their annual IT budget on investments related to IT security compliance. Moreover, almost one out of five spends more than 20 percent of their annual budget on compliance related items, which is well above the industry average.

More than two-thirds of those surveyed use compliance with standards primarily to ensure secure operations. This result is a positive development, as it indicates that most cloud service providers regard industry regulations as a framework for developing their risk management practices. In addition, the vast majority of respondents use compliance for maintaining their reputation and acquiring more customers, which clearly shows that service providers see compliance as crucial to building trust.

Most IT service providers consider compliance with the international standards (for example, ISO 27001 and PCI DSS) important. Naturally, the data protection regulations of the country where a given service provider's data center reside is also important. It is, however, worth to note that legal regulations usually build upon the principles of some international standard.

"It turns out that (privileged) user access control, as well as log management are critical elements of service providers' compliance strategies, whereas basic technologies such as antivirus and firewall systems are much less important already," explained Gábor Marosvári, Product Marketing Manager at BalaBit.

For the majority of respondents (57 percent), monitoring internal and external access to cloud infrastructure is equally important. This can be explained by the fact that access monitoring systems provide strong evidence for service providers in disputes with their customers, and can settle differences of opinion quickly and cost-effectively.

"It is clear from our research that most service providers employ generic user management as well as various levels of authorization and authentication systems. However, only 42 percent of respondents monitor and audit privileged users' activity. Without the right auditing tool, it is impossible to definitively determine 'who did what' in a given network, which can lead to disputes over responsibility and costly investigations," said Marosvári.

The research involved 120 IT directors of IT and cloud service providers, and was conducted in February 2014. A copy of the report can be found at http://www.kpmg.com/HU/en/IssuesAndInsights/ArticlesPublications/Documents/20140718-IT-Security-Compliance-for-Cloud-Service-Providers-m.pdf

About BalaBit
BalaBit -- headquartered in Luxembourg -- is a European IT security innovator, specializing in log management and advanced monitoring technologies. It has sales offices in France, Germany, Hungary, Russia, the UK and the United States and partners in more than 40 countries. The main development centers are based in Hungary. BalaBit has customers all over the world including 23 percent of the Fortune 100 companies.

The company is widely-known for syslog-ng™, its open source log management solution, used by more than a million organizations worldwide. This significant user base provides a solid ground for the business expansion which is fueled by Shell Control Box™, a pioneering development for the rapidly-growing niche of privileged activity monitoring market. For more information, visit www.balabit.com.