Cybersecurity tops risks for TMT sectors in 2024 report

The Technology Media and Telecoms Risk Report 2024 by WTW highlights cyber and data privacy risks as the primary concerns for the TMT sectors.

The report surveyed the global TMT industry and indicated that heightened cyber threats accompany reliance on artificial intelligence (AI) and machine learning for growth. Specifically, 51% of media and telecoms businesses and 46% of technology firms identified cybersecurity as a major risk, with ransomware attacks being the top concern, as noted by 62% of respondents.

Regulatory challenges were also a significant concern, with 55% of respondents citing them as the biggest barriers to achieving strategic objectives. This is attributed to assertive government rules regarding ownership structures and dominant market positions in critical technology and infrastructure areas.

Trade tensions remain a predominant geopolitical issue, with 74% of participants indicating these disputes as critical concerns. These concerns are heightened by the ongoing trade disengagement between China and the West, posing restrictions and tariffs.

Climate change and ESG issues are affecting business strategies, with 50% of respondents expressing concern over the carbon footprint of new technologies. Media sector respondents, at 54%, were particularly worried, especially as technologies like generative AI models, such as ChatGPT, require substantial energy.

Simon Weaver, Head of Asia Pacific and Head of Corporate Risk & Broking Asia Pacific at WTW, remarked, "Technological advancements in TMT have a two-sided nature. As new opportunities arise, they inevitably bring new risks. In Asia Pacific (APAC), supply chain disruption was the number one risk for technology firms we surveyed. On the other hand, AI and machine learning present the greatest opportunities for the sector over the next two years, particularly with the region's focus on innovation and 5G expansion by many of the telecoms companies. For media companies, online advertising and AI seems to be most attractive to companies in APAC."

Weaver further elaborated on the importance of evolving in line with technological advancements, emphasising the need for companies to reassess their risks and management strategies to meet future challenges.

Conor Keating, Cyber Growth Leader, Asia, at WTW, added, "Our TMT clients across Asia constantly face the challenge of remaining scalable and agile in a hyper-competitive economy while ensuring operational resiliency. As they converge their reliance on innovations such as AI to drive growth, cybersecurity and data privacy also come to dominate risk agendas across their businesses."

Keating advocated for a disciplined approach to cyber risk management, suggesting that TMT companies should apply similar rigour to cyber securities as they do to other business risks. "TMT companies can approach this by bringing the same discipline to cyber risk that is applied to other business risks, viewing it through risk matrices, scenario planning and quantifying what the cost of a cyber-related catastrophe looks like for them in dollar terms. Through this lens, they build a technology strategy that is well-aware of the financial impact of a cyber-related peril and can properly fund its risk management and risk transfer strategies. These include investing adequately in people and tools for defense, and ensuring there is financial protection for the organisation if these defenses fail."