Kaspersky Lab: Product Innovation Will Help Combat Cyber 'Arms Race'

But in reality, Eugene Kaspersky, founder and CEO of Moscow-based endpoint security company Kaspersky Lab, said the ongoing saga has escalated to look more like an arms race, with both parties escalating their tactics but neither getting ahead.

Consequently, Kaspersky is developing new technologies to keep pace with the onslaught of malware writers that will inevitably emerge as the result of the global recession.

"It's getting more difficult to fight with these guys. They are getting more organized and more professional," said Kaspersky to a group of about 60 journalists and media analysts during the company's annual press tour, held in Moscow.

As part of its comprehensive effort to combat the growing wave of cyberthreats, Kaspersky Lab execs said that they planned to diversify the company's portfolio and eventually expand into small enterprise market segments. In particular, the company outlined plans to expand its hosted security network as well as enhance its application protection and management technologies, which will complement its existing hybrid of black-listing and real-time white-listing technologies.

The push for innovation comes at a time when threats are more sophisticated, stealthy and destructive, Kaspersky said. Never before has the security landscape been more profit-motivated and organized. And unlike other organized crime, cybernetworks can coalesce easily from anywhere in the world. They have very low overhead. And they rarely get caught.

"Cybercrime is a very easy business for them to be in, and at the same time it's very profitable," Kaspersky said. "Unfortunately, there are not many cases where the cybercriminals are caught by the cybercops."

Because it's low-risk, cybercrime is extremely profitable, generating "not less than $100 billion" annually, Kaspersky said. And it's just going to get worse. As the financial crisis deepens, more unemployed and economically disenfranchised people will subsequently turn to illegal cyberactivity as a way to make ends meet, he said.

During his presentation, Kaspersky pointed to the explosion of malware in order to challenge the notion that antivirus and antimalware are obsolete. While those products will evolve and change, the need is still very relevant, he said.

In fact, it's the explosion of malware in the last two years that has fundamentally driven the company's rapid growth over the past two years, execs say. In 2007, Kaspersky Lab detected about 2 million new malware samples. This year, that number has risen exponentially to about 15 to 20 million malicious samples.

"The industry is in panic," Kaspersky said."This is a question for the industry, What are we going to do to protect our customers? There are a lot of ways."

Consequently, Kaspersky said that it will be investing more resources into its research and development to stay ahead of the malware writers, despite the global economic crisis that has caused many IT companies to pull the reins in on their research spending.

Meanwhile, Kaspersky Lab seems to still be experiencing significant growth despite the downturned economy. Over the past two years, Kaspersky experienced close to 80 percent year-over-year growth, primarily driven by its range of consumer products, as well as SMB offerings, said Evgeny Buyakin, Kaspersky Lab chief operating officer. That growth has allowed the company to gain market share, which currently falls at about 4 percent, putting Kaspersky Lab in fourth place behind Tokyo-based security company Trend Micro.

"We're still very much a technology-driven company," Buyakin said. "Unlike two or three years ago, this industry is going to be a commodity. Now everyone understands -- technology matters. Competition is driven by innovations."