BAE cashes in on state ‘cyber war’

 

Jim Armitage
Tuesday 01 October 2013 01:21
Comments

BAE, one of the biggest defence companies in the world, is expected to be a major beneficiary of the Government’s push into cyber attacks, having already made sales of nearly £1bn in its IT security business over the past five years.

Defence Secretary Philip Hammond shocked the defence community this week by publicly declaring before the Conservative Party conference that the UK was “developing a full-spectrum military cyber capability including a strike capability”.

Companies House filings show that BAE’s Detica cyber security and intelligence arm has been raking in rapidly growing revenues in recent years as it seeks to add to its traditional weapons sales. From £180m-£190m in 2008 and 2009, Detica’s sales grew to £211m last year. It is thought half of those revenues came from Government cyber security contracts, despite a warning in the last set of accounts that the Government had been restricting spending as part of its deficit reduction plan.

Profits have fluctuated from break-even to £20m in the years since BAE bought Detica in 2008, due to various one-off factors, but in total since 2008 they come to about £50m. Britain has been rapidly building up a large industry in the cyber security world, including some controversial businesses such as Gamma, the Hampshire-based business that sells equipment to foreign regimes designed to allow governments to snoop on their citizens’ emails.

While about 50 per cent of Detica’s takings are from classified Government contracts, it is also making tens of millions of pounds a year from advising on, and installing, cyber security measures for the private sector. Only this month it launched IndustrialProtect, which it described as a “military grade” system to protect industrial infrastructure from cyber attack. The Government regularly cites Detica statistics which claim cyber crime costs the economy £27bn a year, but many experts believe this overstates the problem.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in