Schneier on Security

Return on investment, or ROI, is a big deal in business. Any business venture needs to demonstrate a positive return on investment, and a good one at that, in order to be viable.

It’s become a big deal in IT security, too. Many corporate customers are demanding ROI models to demonstrate that a particular security investment pays off. And in response, vendors are providing ROI models that demonstrate how their particular security solution provides the best return on investment.

It’s a good idea in theory, but it’s mostly bunk in practice.

Before I get into the details, there’s one point I have to make. “ROI” as used in a security context is inaccurate. Security is not an investment that provides a return, like a new factory or a financial instrument. It’s an expense that, hopefully, pays for itself in cost savings. Security is about loss prevention, not about earnings. The term just doesn’t make sense in this context…