Explaining the fraud market maturity by analogy with Computer Game ‘Civilization’.
Ah, the 90s. They were wonderful, weren’t they? Nirvana released ‘Nevermind’, people started to go online and everyone was sure the Y2K bug was going to bring about the end of the world. You want to know what else was great? Computer games. The 90s produced some of the most inspiring, innovative computer games the world has ever seen. You may have played ‘Age of Empires’, which was a very influential game for its time, related to real-time strategy, but we cannot ignore the fact Sid Meier's ‘Civilization’ came first, in 1991, with just one objective: build an empire that can last.
In this game, the player takes on the role of the leader of a civilization, starting with one settler unit, and attempts to build an empire in competition with other civilizations. Along with the larger tasks of exploration, warfare and diplomacy, the player has to make decisions about where to build new cities, which improvements or units to build in each city, which advances in knowledge should be pursued, and how to transform the land surrounding the cities for maximum profit.
From time to time the player's towns are attacked by barbarians with no specific nationality and no named leader. These threats only come from unclaimed terrain (land or sea), and over time there are fewer and fewer places from which barbarians would arise.
As time advances, new technologies can be developed and these technologies are the primary way in which the game changes and grows. These stages of ‘scientific advancement’, just as in real life, are directly linked with military strength. In ‘Civilization’ the war starts with a strong infantry unit, catapults and knights can be finished with riflemen, cannons and cavalry. He who has more cutting-edge units usually wins the war.
Like with modern fraud prevention and detection techniques, success in defeating the “barbarians” in Sid Meier's ‘Civilization’ is determined by the capability to reduce uncertainty from emerging fraud threats. However, ‘unclaimed terrains’ can blind you from spotting these emerging threats, and that is why we rely on technological advances to manage fraud threats when fraudsters emerge.
Similar to the game, most of today’s CSPs already have a weapon, or in this case a fraud management tool, that is being used to stop the barbarians, or fraudsters. At first glance, we may mistakenly believe that this is a mature market.
The question now becomes, “If you have a tool but it faces technological disadvantages against the fraudster’s tools, are you really equipped to battle fraud?” Certainly not.
At this point, the service provider has 2 options:
- Weapons are upgraded to a more updated version, (i.e. – The CSP begins with arches and evolves to a crossbow)
- A completely disruptive technology is introduced, (i.e.- where you go for gunpowder or even nuclear weapons to exterminate your enemies)
Either way, until you have the right weapon to defeat your potential enemy, the problem isn’t solved.
One thing is for sure, war is an inevitable part of every fraudster’s game, even if you try to avoid it.
CSPs can gain a large advantage if their fraud departments are the first to achieve a particular technological advantage (the secrets of Artificial Intelligence, for example) and put it to use in a “military” context. The whole system of advancements, from beginning to end, is a full speed technology ride. So is the market mature? Not if it is always open and rejuvenating. In other words, I would say that it ‘Smells Like Teen Spirit!’
This article was first published in Vanilla Plus. You can find the original version here.
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