PCI: The Panacea for Everything Other than Security

 
 
By Evan Schuman  |  Posted 2008-01-24
 
 
 

A Chicago man has an older car that he's not wildly in love with, but it's good transportation.

He's not into the car's appearance, figuring that the paint job is for the entertainment of everyone else. He cares about what's on the inside.

One day he's in a parking lot and discovers that someone placed a huge scratch along the right side of the car. His insurance company inspects and awards him a large check to have the car completely repainted. Instead, the man uses the check to buy a new state-of-the-art audio system.

The way that Chicagoan views his insurance check is how many IT leaders see PCI requirements. At last week's National Retail Federation show, the aisles were crowded and the enthusiasm was unmistakable. With the dire financial warnings of imminent economic collapse, the show should have been deserted. The difference was PCI.

The PCI DSS (Payment Card Industry Data Security Standard), or just PCI, is officially about security, although most security folk have already grown tired of saying that "PCI-compliant" is to "secure" as "filed a tax return by April 15" is to "honest." PCI is a list of security ideals, but strict adherence to that list certainly doesn't mean that a retailer is secure. It's a fine starting point, but it's little beyond that.

To the extent that some retailers view a letter declaring that they're now considered PCI-compliant as a license for them to not worry about security until next year's PCI assessment, there's a case to be made that PCI might even undermine good data security as it offers a false sense of security. It's akin to believing that strict adherence to the USDA Food Pyramid will necessarily deliver a healthy and balanced diet.

New statistics from Visa showed PCI compliance sharply increasing among the largest retailers (Levels 1 and 2), but Visa excluded some 340 noncompliant large retailers from consideration by simply extending its deadline.

So PCI is nice, but it's hardly the cure-all for data security. But some IT managers are finding it to be a nice budget cure-all. The threat of fines and exclusion from preferred credit card fees is scaring many retail chief financial officers to approve lots of money designed to fix PCI-identified shortcomings.

CIOs and IT directors-being the wise and crafty devils that they are-have chosen to use the PCI-freed-up funds to make major improvements in everything from POS to the supply chain to CRM.

For many of the purchases, it's quite legitimate. If a chain's POS systems are antiquated, a thorough PCI program could certainly justify upgrading them. As long as you have to upgrade them, why not add some contactless payment support and some mobile integrations and perhaps an under-cart scan while you're at it?

The truth is that the next wave of retail applications-with their heavy emphasis on wireless capabilities of all sorts-will bring with them an ocean of new security problems. Ostensibly, they'll be addressed by the next wave of PCI requirements, which will free up more dollars for investment.

Yessiree, FUD (Fear, Uncertainty and Doubt, in the time-honored IBM tradition) has never been a stranger to technology purchases. But it's nice this time to have the FUD being used by IT.

Retail Center Editor Evan Schuman has tracked high-tech issues since 1987, has been opinionated long before that and doesn't plan to stop any time soon. He can be reached at eschuma@earthlink.net.

To read earlier retail technology opinion columns from Evan Schuman, please click here.

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