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Assessing the Value of Network Security Technologies: The Impact of Configuration and Interaction on Value



Proper configuration of security technologies is critical to balance the access and protection requirements of information. The common practice of using a layered security architecture that has multiple technologies amplifies the need for proper configuration because the configuration decision about one security technology has ramifications for the configuration decisions about others. We study the impact of configuration on the value obtained from a firewall and an Intrusion Detection System (IDS). We also study how a firewall and an IDS interact with each other in terms of value contribution. We show that the firm may be worse off when it deploys a technology if the technology (either the firewall or the IDS) is improperly configured. A more serious consequence for the firm is that even if each of these (improperly configured) technologies offers a positive value when deployed alone, deploying both may be detrimental to the firm. Configuring the IDS and the firewall optimally eliminates the conflict between them, resulting in a non-negative value to the firm. When optimally configured, we find that these technologies may complement or substitute each other. Further, we find that while the optimal configuration of an IDS is the same whether it is deployed alone or together with a firewall, the optimal configuration of a firewall has a lower detection rate (i.e., allow more access) when it is deployed with an IDS than when deployed alone. Our results highlight the complex interactions between firewall and IDS technologies when they are used together in a security architecture, and, hence, the need for proper configuration in order to benefit from these technologies.

Suggested Citation

  • Huseyin Cavusoglu & Hasan Cavusoglu, 2007. "Assessing the Value of Network Security Technologies: The Impact of Configuration and Interaction on Value," Working Papers 07-19, NET Institute, revised Aug 2007.
  • Handle: RePEc:net:wpaper:0719

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    References listed on IDEAS

    1. Esther Gal-Or & Anindya Ghose, 2005. "The Economic Incentives for Sharing Security Information," Information Systems Research, INFORMS, vol. 16(2), pages 186-208, June.
    2. Gordon, Lawrence A. & Loeb, Martin P. & Lucyshyn, William, 2003. "Sharing information on computer systems security: An economic analysis," Journal of Accounting and Public Policy, Elsevier, vol. 22(6), pages 461-485.
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    More about this item


    information security; software configuration; analytical modeling;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software


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