The Economics of Cyber Offense & Defense

About this episode

Fernando Montenegro argued his way into the analyst world on Twitter. After thirty years in security, including fifteen as a sales engineer, a nudge from Adrian Sanabria landed him at 451 Research, then Omdia, and now The Futurum Group, where he leads cybersecurity. His one condition for coming on the show came from The West Wing: raise the level of debate. What follows is closer to an economics seminar. Fernando explains why the cost of verifiability tilts AI toward attackers, and why defenders don't have to be right every time. He also covers security as a latent construct, the market for lemons, signaling and screening, and the principal-agent problem in the age of AI agents. When Mehul presents $3 exploits, Fernando reaches for the theory of constraints: fix one bottleneck and it moves. He closes with Moneyball advice: stop buying players, start buying runs.