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Patent race picks up speed in the cloud access security broker market

The cloud access security broker market has been keeping the U.S. Patent and Trademark Office busy.

SkyHigh Networks recently announced it obtained another patent for its CASB platform, the third such patent the company has been awarded since it was founded in 2011. SkyHigh’s announcement came shortly after rival Netskope announced it had been awarded a second patent for its own CASB platform.

SkyHigh’s most recent patent covers an “encryption key management system and method” for “an enterprise using encryption for cloud-based services.” The company’s technology features a hosted encryption service or gateway that can handle clients’ encrypted data as it moves to and from cloud services. Rather than enterprises having to send user traffic to cloud applications through an on premise encryption gateway, SkyHigh’s platform handles the process in the cloud.

From the patent abstract: “The network intermediary receives the encryption key material from the enterprise and stores the encryption key material in temporary storage and uses the received encryption key material to derive a data encryption key to perform the encryption of the enterprise’s data. In this manner, the enterprise can be provided with the added security assurance of maintaining and managing its own encryption key while using cloud-based data storage services.”

SkyHigh’s approach for securely managing the encryption keys involves several steps, according to the patent, including the generation of original key material using a key agent deployed within the enterprise network; storing the original key material on the key agent in a temporary memory; using the key agent to request a hardware security module to encrypt the original key material, which the HSM does using the using an enterprise owned and managed encryption key that is available only within the enterprise data network, and so on (for the full process, read the patent description).

If that sounds like a complicated process, that’s because it is. So why is it beneficial to have the encryption gateway hosted in the cloud rather than on the enterprise’s own network? Kaushik Narayan, co-founder and CTO of Skyhigh Networks, said there are operational hurdles to that method. “Previously, enterprises would have to use on premise encryption and key management for data in the cloud,” he said. “But if you’re on the road or outside the corporate network, you would need a VPN to get access to that data. That can make using cloud services a lot more difficult.”

Narayan stressed that SkyHigh’s patented approach doesn’t involve taking ownership of encryption keys from enterprises. “The keys are still owned and kept by the customers,” he said. “The idea behind the patent is to cover the acquisition and distribution of those keys.”

Other CASBs such as CipherCloud use similar hosted encryption approaches, so it remains to be seen if there will be any overlap or potential friction with SkyHigh’s patent. But the flurry of patents awarded to competing startups in the CASB space show just how quickly the market is evolving, and how valuable intellectual property in the CASB market can be.

The patent also further demonstrates how crucial encryption is to the CASB model in particular and cloud security in general. Narayan said SkyHigh, which last month announced $40 million in series D financing, has put greater focus on encryption because of customer demand.

“Encryption is a core component of the CASB model. Fundamentally where this all started is with customers in certain verticals like financial services and healthcare, as well as businesses in certain regions with strict regulatory concerns,” Narayan said. “When these customers put third party customer or citizen data in the cloud, they have to — for a variety of compliance reasons — protect that data.”