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June 3, 2024

Exploring the Benefits and Risks of Third-Party Data Solutions

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03
Jun 2024
Many companies use third-party data management for efficiency, global access, collaboration, and reliability. Find out what those organizations need to know about addressing the security risks and best practices associated with third-party data management.

Why do companies allow third parties to handle their data?

Companies seek out third parties to handle their data for operational efficiency.

The scale and cost of maintaining in-house infrastructure can be outsourced to third parties who specialize in data management or in certain business functions.

Third parties who handle an organization’s data can range from large public cloud providers such as Azure or AWS, to boutique companies who handle specific business functions such as telemarketing, payment systems, or webpage hosting.

The operational efficiencies gained through third-party data management can be summarized by three key benefits:

  • Global accessibility: Third-party data storage enables data access across the globe, allowing businesses to access data from anywhere.
  • Enhanced collaboration: Third-party data storage allows for file sharing, real-time editing, and integration with other applications and services enhancing a business’s collaboration efforts.
  • Reliability and uptime: Reputable third-party storage providers offer high reliability and uptime guarantees, ensuring that data is available whenever needed. They typically have robust disaster recovery and backup systems in place to prevent data loss.

Given these benefits, it is no surprise that businesses are using these services to expand their operations and scale efforts with the need of a growing business. This strategic move not only optimizes resource allocation but also enhances operational agility, enabling businesses to adapt swiftly to evolving data demands and maintain a competitive edge in a dynamic market.

Security risks of entrusted data to third-party vendors

Entrusting data to third parties can expose businesses to supply chain risks and increase the risk of data breaches and unauthorized access. A business has less control over its data and becomes dependent on the third party's policies, practices, and uptime. Many third-party vendors are the target of hackers who specialize in monetizing sensitive data and exploiting gray areas around who is responsible for securing the data.

Thus, businesses are vulnerable when they entrust sensitive data to third-party platforms, which often lack transparency about data usage and security. The platforms, chosen mainly for cost, efficiency, and user experience, are frequent targets for cyber criminals, hacktivists, and opportunistic lone hackers looking for sensitive data accidentally exposed due to misconfigurations or poor data management policies.

Consumers are putting pressure on businesses to improve cybersecurity when handling their personal data. Businesses who suffer a data breach face a high level of scrutiny from customers, investors, the media, and governments, even when the data breach is the result of a third party’s being hacked. For example, Uber made headlines in 2022 for a data breach which was the result of a compromised vendor who had access to data regarding Uber’s employees.

Similarly, the UK’s Ministry of Defence was the victim of a data breach earlier this year when hackers targeted a third party payroll system used by the government department.

Why do cyber-criminals target third parties?

Cyber-criminals can potentially gain access to multiple networks when targeting a third-party storage provider. A successful attack could give attackers access to the networks and systems of all its clients, amplifying the impact of a single breach.

For example, when Illuminate Education was the target of a cyber-attack, the data of 23 US School Districts was stolen via its student-tracking software. It included student data from the country's two largest school systems - New York City Public Schools and Los Angeles Unified School District.

Common third-party security risks

When collaborating with third parties, organizations should be aware of the most common types of security risks posed to their cybersecurity.

  • Software supply chain attacks: Software supply chain attacks occur when cyber criminals infiltrate and compromise software products or updates at any point in the development or distribution process. This allows attackers to insert malicious code into legitimate software, which then gets distributed to users through trusted channels.
  • Human error: Human error in cybersecurity refers to mistakes made by individuals that lead to security breaches or vulnerabilities. These errors can result from lack of awareness, insufficient training, negligence, or simple mistakes.
  • Privileged access misuse: Privileged access misuse involves the inappropriate or unauthorized use of elevated access rights by individuals within an organization. This can include intentionally malicious actions or unintentional misuse of administrative privileges.

What to look for in a security solution when using third parties to store or manage data

Understanding the security posture of a third party is important when partnering with it and entrusting it with your organization’s data. Understanding how basic cyber hygiene policies are implemented is a good place to start, such as data retention policies, use of encryption for data in storage, and how identity and access are managed.

In some circumstances, it is important to understand who is responsible for the data’s security. For example, when using public cloud infrastructure, it is generally the responsibility of the data owner to manage how the data is accessed and stored.

In that situation, an organization needs to ensure it has solutions in place which gives it full visibility of that third-party environment, and which can proactively identify misconfigurations and detect and respond to suspicious activity in real time.

Benefits of using AI tools to aid in managing sensitive data

According to research performed by IBM, organizations with extensive use of security AI and automation identified and contained a data breach 108 days faster in 2023 than organizations that did not use AI for cybersecurity. (1) This figure is only likely to improve as companies mature in their adoption of AI for cyber security and can be a key indicator in the security posture of a third-party vendor.

Example of third-party security incidents

Sumo data breach

Sumo, an Australian energy and internet provider, suffered a data breach which they became aware of on May 13th, 2024. Further investigation into the cyber incident has found that “the personal details of approximately 40,000 customers were compromised, including approximately 3,000 Australian passport numbers.” (2)

While none of Sumo’s systems were allegedly accessed or affected and the third-party application also worked as designed (3), the incident was blamed on an unnamed third party. The breach may have been the result of a misconfiguration or human error.

This incident underscores the importance of not only selecting third-party providers with robust security measures but also continuously monitoring and assessing their security practices.

How Darktrace helps monitor third-party data usage

Darktrace/Cloud uses Self-Learning AI to provide complete cyber resilience for multi-cloud environments.

Benefits of Darktrace/Cloud:

Architectural awareness: Gives users an understanding of their cloud footprint, including real-time visibility into cloud assets, architectures, users and permissions. Combines asset enumeration, modeled architectures, and flow log analysis. Cost insights give a better understanding of resource allocation, helping teams contextualize resources.

Cloud-native detection and response: AI understands ‘normal’ for your unique business and stops cyber-threats with autonomous response. Near-real-time response goes beyond simple email alerts or opening a ticket; and includes cloud-native actions like detaching EC2 instances and applying security groups to contain risky assets.

Cloud protection and compliance: Identify compliance issues and potential misconfigurations with attack path modeling and prioritized remediation steps. Darktrace’s attack surface management (ASM) adds a critical external view of your organization, highlighting vulnerabilities most impactful to your specific situation and revealing shadow IT.

Learn more about securing cloud environments by reading: The CISO’s Guide to Cloud Security here.

References

1.    https://www.ibm.com/reports/data-breach

2.    https://www.passports.gov.au/news/sumo-data-breach

3.    https://www.smh.com.au/technology/sumo-slammed-by-data-breach-as-energy-and-internet-customers-have-details-leaked-20240515-p5jdwp.html

Inside the SOC
Darktrace cyber analysts are world-class experts in threat intelligence, threat hunting and incident response, and provide 24/7 SOC support to thousands of Darktrace customers around the globe. Inside the SOC is exclusively authored by these experts, providing analysis of cyber incidents and threat trends, based on real-world experience in the field.
Author
Oakley Cox
Director of Product

Oakley is a Product Manager within the Darktrace R&D team. He collaborates with global customers, including all critical infrastructure sectors and Government agencies, to ensure Darktrace/OT remains the first in class solution for OT Cyber Security. He draws on 7 years’ experience as a Cyber Security Consultant to organizations across EMEA, APAC and ANZ. His research into cyber-physical security has been published by Cyber Security journals and by CISA. Oakley has a Doctorate (PhD) from the University of Oxford.

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Email

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March 19, 2025

Global Technology Provider Transforms Email Threat Detection with Darktrace

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At a glance

  • Within just one month of using Darktrace / EMAIL, the volume of suspicious emails requiring analyst attention dropped by 75%, saving analysts 45 hours per month on analysis and investigation.
  • By offloading most manual, repetitive tasks to Darktrace / EMAIL, the company’s skilled security analysts can focus on developing new capabilities and tackling more complex, rewarding projects.
  • Darktrace recently detected and blocked a highly sophisticated and personalized phishing email that spoofed a Microsoft SharePoint and Teams website and used advanced engineering to impersonate the school of an employee’s family member.
  • The transition from the incumbent solution to Darktrace / EMAIL was seamless and undetectable to the company’s vast of customers and partners, reinforcing the security organization’s role as a business enabler—protecting the company and reducing risk without adding friction.

Securing a complex, distributed business without disruption

The company remains at the forefront of technological innovation and transformation; however, its success and ambitions come with the challenges of managing a distributed global business—balancing digital advancements, existing technology investments, and evolving compliance requirements.

Optimizing a complex tech stack for scalable growth

The organization operates a diverse technology stack spanning Windows, Mac, Linux, and multiple cloud environments, creating a complex and challenging IT landscape. The company’s Chief Information Security Officer (CISO) emphasizes the need for efficiency and agility. “Our goal is to scale and deliver new capabilities without increasing headcount, ensuring that costs remain proportionate to growth.”

Balancing security, governance, and business agility

Committed to responsible practices, this industry leader prioritizes secure and trustworthy technology for its customers who rely on its solutions. “Balancing business agility with governance is a constant challenge," said the CISO. "There’s always a natural push and pull, which I believe is healthy—but achieving the right balance is delicate.”

Protecting critical workflows without impacting productivity

For the organization, email is much more than just a communication tool. “Email plays a critical role in our engineering workflows and is fundamental to how we build our products.” Because of this, the company is extremely cautious about implementing any solution that could introduce friction or disrupt productivity. “There is zero tolerance for disruption, which is why we take a deliberate and methodical approach when evaluating, selecting, and deploying our tools and solutions,” he said.  

More than a vendor: A security partner invested in success

To ensure an optimal security infrastructure, the enterprise security team regularly evaluates market technologies to their existing solutions. With the rapidly evolving threat landscape, the CISO said they “wanted to validate whether we still had best-in-class protection and the right controls in place to secure our organization. It was about assessing whether we could do better in our ongoing effort to fine-tuning our approach to achieve the best possible outcome.”

The team evaluated 15 different email security vendors based on the following criteria:

  1. Efficacy to detect threats
  2. Ability to integrate with existing tooling
  3. Ease of use
  4. A vendor’s approach to partnership  

They initially narrowed the list to five vendors, conducting demo sessions for deeper evaluations before selecting three finalists for a proof of value (POV). We analyzed actual malicious emails with each vendor to assess the accuracy of their detections, allowing for an objective comparison,” said the CISO. Through this rigorous process, the Darktrace / EMAIL security solution emerged as the best fit for their business. “Darktrace’s product performed well and showed a genuine commitment to partnering with us in the long-term to ensure our success.”

The team objectively understood where there were gaps across the different vendors, where they were strong, and where they could use improvement. “Based on the analysis, we knew that Darktrace / EMAIL could deliver as the data supported it, in our specific use cases.  

Partnership, integrity and respect

Throughout the evaluation process, the importance of partnership and mutual respect remained an essential factor to the CISO. “I wanted a company we could develop a long-term strategic partnership with, one that could extend far deeper than just email.” A key factor in choosing Darktrace was the commitment and engagement of its team at every level of the organization. “Darktrace showed integrity, patience and a genuine investment in building a strong relationship with my team.  That's why we're here today.”

“Together, we've delivered some fantastic outcomes”

For the organization, Darktrace / EMAIL has played a crucial role in reducing risk, empowering analysts, and enabling a lean, effective security strategy. “Together, we've delivered some fantastic outcomes,” said the CISO.  

Reducing risk. Empowering analysts

“Within that first month, we saw a 75% drop in suspicious emails that that required manual review, which reduced the time my team spent analyzing and investigating by 45 hours per month,” said the CISO. The security team values Darktrace / EMAIL not only for its ease of use but also for the time it frees up for more meaningful work. “Giving my team the opportunity to tackle complex challenges they enjoy and find more stimulating is important to me.” As they continue to fine-tune and optimize balance levels within Darktrace / EMAIL, he expects even greater efficiency gains in the coming months.

Maximizing protection while staying lean

It’s important for the security group to be proportionate with their spending, said the CISO. “It's all about what is enough security to enable the business. And that means, as our organization grows, it's important that we are as lean and as efficient as possible to deliver the best outcomes for the business.”  Embracing an AI-powered automated approach is an essential component to achieving that goal. By offloading most manual, repetitive tasks to Darktrace / EMAIL, the company’s skilled security analysts can focus on more strategic and proactive initiatives that enable the business.  

Protecting employees from advanced social engineering threats

Recently, Darktrace detected a malicious email targeting an employee, disguised as a spoofed Microsoft SharePoint and Teams website. What made this attack particularly sophisticated was its personalization — it impersonated the school where the employee’s family member attended. Unlike mass malicious emails sent to thousands of people, this was a highly targeted attack, leveraging advanced social engineering tactics to exploit connections within the education system and between family members.  

Protecting without disrupting

A seamless migration is often overlooked but is critical to success for any organization, said the CISO. With a wide ecosystem of partners, email is a highly visible, business-critical function for the organization — "any friction or downtime would have an immediate impact and could throttle the entire business,” he said. However, the transition from their previous solution to Darktrace / EMAIL was exceptionally smooth. “No one realized we changed providers because there was no disruption — no incidents at all. I cannot emphasize just how important that is when I'm trying to position our security organization as an enabling function for the business that protects and reduces risk without adding friction.”

A security partnership for the future

“To survive as a business over the next few years, adopting AI is no longer optional—it’s essential,” said the CISO. However, with the cybersecurity market becoming increasingly saturated, selecting the right solutions and vendors can be overwhelming. He stresses the importance of choosing strategic partners who not only deliver the outcomes you need, but also deeply understand your organization’s unique environment. “You’re only as strong as your partners. Technology innovation and the cybersecurity market are always changing.  At some point every solution will face a challenge—it’s inevitable. The differentiator will be how people respond when that happens.”  

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AI

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March 19, 2025

Survey findings: How is AI Impacting the SOC?

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There’s no question that AI is already impacting the SOC – augmenting, assisting, and filling the gaps left by staff and skills shortages. We surveyed over 1,500 cybersecurity professionals from around the world to uncover their attitudes to AI cybersecurity in 2025. Our findings revealed striking trends in how AI is changing the way security leaders think about hiring and SOC transformation. Download the full report for the big picture, available now.

Download the full report to explore these findings in depth

The AI-human conundrum

Let’s start with some context. As the cybersecurity sector has rapidly evolved to integrate AI into all elements of cyber defense, the pace of technological advancement is outstripping the development of necessary skills. Given the ongoing challenges in security operations, such as employee burnout, high turnover rates, and talent shortages, recruiting personnel to bridge these skills gaps remains an immense challenge in today’s landscape.

But here, our main findings on this topic seem to contradict each other.

There’s no question over the impact of AI-powered threats – nearly three-quarters (74%) agree that AI-powered threats now pose a significant challenge for their organization.  

When we look at how security leaders are defending against AI-powered threats, over 3 out of 5 (62%) see insufficient personnel to manage tools and alerts as the biggest barrier.  

Yet at the same time, increasing cyber security staff is at the bottom of the priority list for survey participants, with only 11% planning to increase cybersecurity staff in 2025 – less than in 2024. What 64% of stakeholders are committed to, however, is adding new AI-powered tools onto their existing security stacks.

With burnout pervasive, the talent deficit reaching a new peak, and growing numbers of companies unable to fill cybersecurity positions, it may be that stakeholders realize they simply cannot hire enough personnel to solve this problem, no matter how much they may want to. As a result, leaders are looking for methods beyond increasing staff to overcome security obstacles.

Meanwhile, the results show that defensive AI is becoming integral to the SOC as a means of augmenting understaffed teams.

How is AI plugging skills shortages in the SOC?

As explored in our recent white paper, the CISO’s Guide to Navigating the Cybersecurity Skills Shortage, 71% of organizations report unfilled cybersecurity positions, leading to the estimation that less than 10% of alerts are thoroughly vetted. In this scenario, AI has become an essential multiplier to relieve the burden on security teams.

95% of respondents agree that AI-powered solutions can significantly improve the speed and efficiency of their defenses. But how?

The area security leaders expect defensive AI to have the biggest impact is on improving threat detection, followed by autonomous response to threats and identifying exploitable vulnerabilities.

Interestingly, the areas that participants ranked less highly (reducing alert fatigue and running phishing simulation), are the tasks that AI already does well and can therefore be used already to relieve the burden of manual, repetitive work on the SOC.

Different perspectives from different sides of the SOC

CISOs and SecOps teams aren’t necessarily aligned on the AI defense question – while CISOs tend to see it as a strategic game-changer, SecOps teams on the front lines may be more sceptical, wary of its real-world reliability and integration into workflows.  

From the data, we see that while less than a quarter of execs doubt that AI-powered solutions will block and automatically respond to AI threats, about half of SecOps aren’t convinced. And only 17% of CISOs lack confidence in the ability of their teams to implement and use AI-powered solutions, whereas over 40% those in the team doubt their own ability to do so.

This gap feeds into the enthusiasm that executives share about adding AI-driven tools into the stack, while day-to-day users of the tools are more interested in improving security awareness training and improving cybersecurity tool integration.

Levels of AI understanding in the SOC

AI is only as powerful as the people who use it, and levels of AI expertise in the SOC can make or break its real-world impact. If security leaders want to unlock AI’s full potential, they must bridge the knowledge gap—ensuring teams understand not just the different types of AI, but where it can be applied for maximum value.

Only 42% of security professionals are confident that they fully understand all the types of AI in their organization’s security stack.

This data varies between job roles – executives report higher levels of understanding (60% say they know exactly which types of AI are being used) than participants in other roles. Despite having a working knowledge of using the tools day-to-day, SecOps practitioners were more likely to report having a “reasonable understanding” of the types of AI in use in their organization (42%).  

Whether this reflects a general confidence in executives rather than technical proficiency it’s hard to say, but it speaks to the importance of AI-human collaboration – introducing AI tools for cybersecurity to plug the gaps in human teams will only be effective if security professionals are supported with the correct education and training.  

Download the full report to explore these findings in depth

The full report for Darktrace’s State of AI Cybersecurity is out now. Download the paper to dig deeper into these trends, and see how results differ by industry, region, organization size, and job title.  

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