Secure Zero Trust Virtual Data Rooms (VDRs) represent the cutting-edge of data storage solutions, designed to meet the evolving demands of data security in an era of increasing cyber threats. In this article, we explore the imperative shift to these advanced VDRs and the myriad advantages they offer over traditional data room solutions.
Top 13 Reasons to Adopt Zero Trust Secure Virtual Data Rooms
Estimated reading time: 5 minutes
A virtual data room (VDR) is an online storage place for the gathering, sharing and collaboration of sensitive and confidential documents.
What is the Function of a Virtual Data Room?
A virtual data room is typically used by larger organizations for business and financial transactions, such as mergers and acquisitions, due diligence processes, initial public offerings (IPOs), and other activities that involve the exchange of sensitive information between parties. Smaller organizations such as accounting firms would use a virtual data room for the collection and storage of personal or small business tax information and small business bookkeeping. A small law office would use a virtual data room for the collection and storage of confidential information used in personal legal proceedings such as divorce and family law negotiations, will settlements and real estate transactions.
What are the Characteristics of a Virtual Data Room?
8 Key characteristics and features of a virtual data room include:
- VDRs are designed to provide a highly secure environment for storing documents and data. They use measures to protect information from unauthorized access.
- Administrators can grant and manage access permissions to various users, allowing them to view, edit, or download specific documents based on their roles and responsibilities.
- VDRs offer tools for organizing and categorizing documents, making it easy to search for and access specific information quickly.
- Users can collaborate within the VDR by commenting on documents, discussing transactions, and conducting Q&A sessions, all within a secure platform.
- VDRs typically maintain a detailed audit trail that records who accessed documents, when, and what actions they performed, providing transparency and accountability.
- VDRs enable users to securely share documents and information with external parties, such as legal counsel, financial advisors, or potential investors, without the need for physical document exchanges.
- VDRs often comply with industry-specific regulations and data protection standards, such as GDPR (General Data Protection Regulation) and HIPAA (Health Insurance Portability and Accountability Act).
Reporting and Analytics:
- Some VDRs offer reporting and analytics features to track user activity and assess document engagement.
What is a Zero Trust Secure Data Room?
A Zero Trust secure data room is a secure data storage system rooted in zero trust principles and built using a zero trust architecture. It operates on the foundational belief that potential threats may arise from either external or internal sources, thus harboring an inherent skepticism toward all users. In the Zero Trust paradigm, identity verification and user authentication are mandatory prerequisites before granting access, without relying on factors such as the user’s physical location or the device they are using, regardless of its perceived trustworthiness.
Why is a Zero Trust Architecture Important for a Virtual Data Room?
The utilization of this architectural framework adheres to the principles of zero trust access control, as specified in NIST SP-800-171v2. Within the context of a zero-trust architecture applied to access, sharing, and collaboration in a virtual data room, a central server assumes the role of verifying user identities and permissions. It subsequently delivers requested files to users without permitting direct shared access to the source location of these resources. A simplified zero-trust architecture is illustrated in Diagram 1.
This architectural approach allows for the storage of data in a variety of locations, including cloud-hosted repositories, FTP repositories, SharePoint repositories, and on-premises storage, all serving as potential sites for the virtual data room. Importantly, the virtual data room need not be hosted and managed by a third party, and sensitive information does not necessitate uploading to an external server. Access control and restrictions can be meticulously overseen by management, aligning with Least Privilege Principles and the IT chain of command. Furthermore, since all actions are governed by a zero-trust server, a comprehensive record of all activities is maintained for forensic investigations.
This zero-trust approach is specifically engineered to bolster cybersecurity by minimizing the attack surface and mitigating the risk of unauthorized access or data breaches.
In the webinar produced by the Edge Computing Association below, Tom Ward, VP of Marketing for Qnext explains zero trust-based virtual data rooms and the technology used to create them.
What is the Difference Between First Generation and Zero Trust Generation Data Rooms?
First-generation virtual data room platforms, including Vault Rooms, Drooms, Ethos, DocSend, SecureDocs, IntralLinks/Synchronos, Datasite/Firmx, FirmRoom, ShareVault, ShareFile, and the utilization of cloud-based sharing platforms for virtual data room creation, such as Google Drive, Box, OneDrive, Egnyte, Citrix, and Kiteworks, primarily focus on enabling collaborative access and file management within their centralized infrastructure. However, these platforms often require duplicating or synchronizing files to a central server controlled by the service provider, and cannot access files stored in other locations.
In contrast, the implementation of Zero Trust Data Access, as exemplified in FileFlex, ushers in a new era for secure virtual data rooms. This innovative generation empowers organizations to securely establish virtual data rooms across their entire infrastructure, encompassing on-premises, cloud-hosted, and SharePoint storage. Zero Trust Data Access excels in delivering enhanced access control, micro-segmentation, adherence to the least privilege principles, robust activity monitoring and authentication, compliance with privacy regulations, adaptability, scalability, heightened insider threat mitigation, reduced ransomware risk, and comprehensive support for data governance throughout the organizational infrastructure, not confined solely to files stored in managed silos.
The disparities between the two can be succinctly summarized as follows:
Centralized vs. Decentralized Storage
- The primary distinguishing factor between first-generation virtual data room platforms and a data room built on Zero Trust Data Access, as exemplified by FileFlex, lies in their storage approaches. First-generation platforms predominantly adopt a centralized model, necessitating the replication or synchronization of files to a central server. Conversely, Zero Trust Data Access serves as a storage overlay that embraces a decentralized strategy, allowing users to access files directly from their original storage locations. This approach affords organizations increased flexibility, efficient resource utilization, heightened security, and cost reductions by eliminating the need for file duplication, all while facilitating seamless access to files dispersed across various locations.
File Sharing and Collaboration
- Both first-generation virtual data room platforms and FileFlex’s implementation of Zero Trust Data Access offer file-sharing and collaboration capabilities. However, first-generation platforms are restricted to sharing and collaborating on files stored within their platforms, whereas FileFlex’s storage overlay empowers sharing and collaboration with files located anywhere within the organizational infrastructure.
Windows File Explorer Integration
- While certain first-generation platforms offer integration with Windows File Explorer, this integration primarily pertains to files stored within their centralized servers. In contrast, Zero Trust Data Access takes a federated approach, seamlessly incorporating all diverse storage locations into the Windows environment. Consequently, FileFlex delivers full Windows functionality for all accessed storage, simplifies sharing from any repository within Windows, and enables in-app file operations directly from remote repositories.
Network File Access, Network File Access Control, and Network Security
- The purview of first-generation platforms does not encompass network file access, network file access control, or network security. Conversely, the Zero Trust Data Access, as enacted by FileFlex, extends its capabilities by offering granular access control, subfolder access, hidden servers, and appliances, while restricting access to data VLANs. Through monitoring and control of user network access, FileFlex minimizes the attack surface, aligns with compliance requirements, and aids in mitigating insider threats.
- Concerning data governance, first-generation virtual data room platforms primarily apply governance measures to files confined to their platforms. In contrast, the implementation of Zero Trust Data Access by FileFlex reinforces cybersecurity through the enforcement of access controls, data segmentation, user tracking and authentication, adherence to the least privilege principle, and protective measures across the entire organizational storage infrastructure. By aligning with comprehensive data governance standards, FileFlex bolsters the data governance and overall security posture of organizations.
- Lastly, in the context of IT control with distributed administration, it is beyond the scope of first-generation platforms to provide IT control over the intricate organizational structure of unstructured data. The advanced data governance capabilities of FileFlex’s Zero Trust Data Access, on the other hand, empower centralized control over file access and facilitate distributed administration for branch offices, subsidiaries, partners, and vendors. This enables organizations to maintain consistent and secure governance throughout their entire file ecosystem.
- Regulatory compliance represents another critical area where first-generation virtual data room platforms and the Zero Trust Data Access, as implemented by FileFlex, diverge in their functionalities. First-generation platforms primarily focus on aiding compliance for files stored exclusively within their platforms, ensuring that files stored and shared through their systems generally adhere to regulatory standards. Conversely, FileFlex offers organizations a comprehensive solution to safeguard access to all their unstructured data storage repositories, aiding in compliance with regulatory requirements across their entire infrastructure. The zero-trust architecture promotes compliance by furnishing organizations with detailed provisions for authentication, authorization, access control, monitoring, encryption, activity logs, auditing, and data governance.
Reducing the Risk of Ransomware
- When it comes to reducing the risk of ransomware, first-generation platforms are not specifically engineered for this purpose, whereas Zero Trust Data Access, as implemented by FileFlex, provides access controls, constraints on lateral movement, and activity monitoring designed to detect and prevent ransomware attacks.
Top 13 Reasons to Adopt Zero Trust Secure Virtual Data Rooms
Adopting the Zero Trust methodology for establishing secure virtual data rooms, as exemplified by FileFlex Enterprise, offers numerous compelling advantages for organizations. Below, we present compelling reasons for organizations to consider the implementation of Zero Trust Secure Virtual Data Rooms:
- The Zero Trust approach places a strong emphasis on continuous verification and enforces rigorous access controls, effectively reducing the risk of unauthorized access and potential data breaches. This heightened security is especially crucial in a constantly evolving cybersecurity landscape.
Mitigates Ransomware Risks:
- Secure virtual data rooms employing the Zero Trust model counteract ransomware by limiting shared access to sensitive data, closely monitoring user activities, and restricting lateral movement within the network. This proactive approach aids in the prevention of ransomware attacks and ensures the integrity of data.
Provides Robust Insider Threat Protection:
- Zero Trust extends its protective measures to address internal vulnerabilities. It does so by thoroughly verifying all users and devices, regardless of their roles or locations within the organization. This comprehensive approach minimizes the risk of unauthorized or malicious insider activities, effectively preventing unauthorized access by employees or contractors. Access control is strictly regulated based on user roles, reducing lateral movement and safeguarding the infrastructure.
Enhances Data Privacy and Compliance:
- Zero Trust principles seamlessly align with stringent data protection and compliance standards such as HIPAA, GDPR, CIRCI, CMMC, ISO 27001, ENISA, and other regulatory frameworks. By implementing stringent access controls and encryption, organizations can fortify access to sensitive customer data and better adhere to regulatory compliance.
Reduces the Attack Surface:
- Zero Trust optimizes security by segmenting and isolating network resources, eliminating the need to duplicate data to secondary locations. This strategy effectively diminishes the attack surface, making it significantly more challenging for potential attackers to move laterally within the network, thereby curbing the proliferation of threats.
Streamlines Efficient Sharing of Federated Storage:
- A Zero Trust architecture streamlines secure file sharing across diverse data repositories, encompassing on-premises, cloud-hosted, and SharePoint, spanning multiple domains. Importantly, it eliminates the need for redundant duplication on secondary servers, often owned and managed by third parties.
Adapts to Contemporary Work Environments and Contractor Integration:
- In the modern landscape characterized by remote work and widespread mobile device usage, Zero Trust enables secure file sharing and access from anywhere. Moreover, it transcends traditional network perimeters to provide contractors and gig-workers with controlled shared access, thanks to its adherence to micro-segmentation and the least privilege principles, effectively mitigating risks associated with external data access.
Offers an Exceptional User Experience with Seamless Integration:
- While steadfastly prioritizing security, the Zero Trust architecture seamlessly integrates with Windows File Explorer and popular Windows applications like Microsoft 365, Adobe, and AutoCAD. This integration enhances the user experience, streamlines data access, and eliminates the need for additional virtual data rooms or file-sharing platforms and workflows.
Provides Granular User Permissions for Virtual Data Rooms:
- Users can establish as many secure rooms as needed, with the flexibility to set permissions on a user-by-user basis, incurring no additional costs. These rooms can be facilitated from any repository, and comprehensive user activity logs are maintained for analytics, monitoring, and alerts.
Equips Advanced Incident Response Capabilities:
- Zero Trust environments boast robust auditing and logging capabilities, essential for incident response and forensic analysis. These logs provide critical data for organizations to promptly detect and mitigate security incidents.
Bestows Exemplary Data Governance and IT-Controlled Chain of Command:
- The management console empowers IT management with granular control over permission levels, even down to the file level on a user-by-user basis, ensuring robust data governance and a clear chain of command over sensitive data. All data transfers pass through a Zero Trust policy server, equipping IT with detailed activity logs for data access and sharing. This facilitates close monitoring of user behavior, anomaly detection, and identification of potential security threats.
Presents a Cost-Effective Model:
- The architecture eliminates the need for expensive cloud storage duplication, operating on an efficient and budget-friendly subscription model, making it a cost-effective solution for organizations.
Embodies Future-Proofing as a Core Principle:
- Zero Trust stands as a forward-thinking security model that acknowledges the ever-evolving landscape of cyber threats and the changing nature of work environments.
Conclusion: The Imperative Transition to Next-Generation Zero Trust Virtual Data Rooms
In an ever-evolving cybersecurity landscape, organizations must embrace the transition to next-generation Zero Trust Virtual Data Rooms (VDRs). These advanced solutions offer superior data security, robust protection against ransomware, superior governance and chain-of-command and comprehensive insider threat prevention, while also ensuring compliance, reducing the attack surface, and providing a cost-effective, future-proof approach. The shift to zero-trust VDRs is not a choice but a necessity for organizations committed to strengthening data security in the modern digital era.
How to Make a Zero Trust Virtual Data Room?