The Invisible Backhand: How Anonymous Has Already Won

The hacker group Anonymous has been on a tear lately, successfully hacking the Tunisian government, Sony, federal cybersecurity contractors, and after suffering from several raids, is now even eyeing the FBI.

It's an interesting era for extreme cyber activism, with the hacker community seemingly finding its voice and becoming very creative in extracting vengeance upon organizations it sees as oppressive. Much has been said about whether this is ethical, if Anonymous can maintain effectiveness, and how things will develop from here. But I think most commentators have missed the point:

Anonymous has already won. And it boils down to one word: insurance.

It looks probable that cybersecurity insurance will become required for many sorts of companies-- the proverbial cat is out of the bag, and even if Anonymous isn't behind the keyboard, so-called "ethical hacking" is likely to increase in popularity. Given this, it'll become as common to hedge your risk from hacking as it is to hedge your risk from fire or flooding. But insurance companies aren't dumb, and it's likely that the premium on cybersecurity insurance will strongly reflect how much of a high-profile hacker target a company is. Just like it's more expensive to insure a mud-foundation coastal house from hurricanes, so too it'll be more expensive to insure a company popularly seen as brazenly greedy against hackers. Companies will have a powerful and quantifiable incentive to not engage in activities that make them a target.

To put this a different way, sometimes companies do things that are legal but unethical. Vigilante justice can 'reinternalize' the externalized costs of these behaviors.

Granted, I'm not saying illegally hacking companies is a good thing, just that Anonymous has the potential to be a very potent market force. They could still snatch defeat from the jaws of victory by being capricious with their targets: if there's little correlation between deed and penalty, insurance premiums will be high across the board. It'll be interesting to see how things turn out.

Quote of the week: on distractions

From the New York Time's Why Writers Belong Behind Bars:

It’s wonderful that writers can access medieval manuscripts, Swahili dictionaries and collections of 19th-­century daguerreotypes at any moment. But the downside is that it’s almost impossible to finish a sentence without interruption. I confess that even those last 15 words were stalled by a detour, via Wikipedia, to various health Web sites, where I learned that concern was aroused last year by a report that Wi-Fi radiation was causing trees to shed their bark in a Dutch town, and that our excessive Web browsing and e-mailing may also be having ill effects on bees and British children. After an hour of this, I concluded that perhaps an equally urgent scientific study might be conducted on the devastation Wi-Fi has caused to world literature. The damage is surely incalculable.