
Reframing Managed File Transfer’s Role in the Modern Enterprise
Managed file transfer (MFT) has been a crucial piece of the digital puzzle for enterprises for decades now. Over the years, however, the primacy of managed file transfer in the enterprise data-sharing ecosystem has been challenged by the emergence of other faster, more efficient, and potentially cost-effective file transfer options. But, far from rendering managed file transfer obsolete, these developments have necessitated a rethink – a reframing of MFT’s role in the modern enterprise.
In this blog post, we’ll take a closer look at managed file transfer technology, including its historical strengths, challenges, innovations, and whether or not it has a place in the modern enterprise (spoiler alert: it does).
Managed File Transfer: Marginalized, But Not Obsolete
Managed file transfer (MFT) has been the go-to solution for businesses for many years because it has presented a secure, reliable means of transferring large amounts of data.
Managed file transfer emerged as a reliable solution for file transfers dating back to the early 2000s. It was initially designed to replace traditional file transfer methods, like file transfer protocol (FTP) and secure file transfer protocol (SFTP), which lacked the robustness and reliability required by modern businesses.
Managed file transfer quickly gained traction by offering improved security, greater control over file transfers, and more comprehensive tracking and auditing capabilities. Managed file transfer provided businesses a secure way to transfer files both internally and externally, minimizing the risk of data breaches. With features like encryption and authentication protocols, businesses could ensure that only authorized users could access and transfer sensitive data.
Managed file transfer’s primary value was, by and large, its ability to manage large volumes of data transfers. Organizations could schedule automated file transfers, saving significant time and resources. Additionally, MFT allowed for real-time monitoring and reporting, giving businesses unparalleled visibility into their data transfer processes. In essence, managed file transfer brought a new level of sophistication to enterprise file transfer processes. Despite the recent advancements in cloud-based technologies and APIs, managed file transfer continues to hold a crucial place in enterprise data management.
Nevertheless, with the swift and steady progression of technology, alternative solutions started to crop up, aimed at tackling the limitations of managed file transfer. For instance, cloud-based storage systems began to gain popularity due to their ability to allow real-time access to files from any location, given the presence of a reliable internet connection. This eliminated the need for physical data storage devices and the associated risk of damage or loss, thereby making data storage and retrieval processes more efficient and reliable.
Key Takeaways
- Evolution of Managed File Transfer (MFT) Initially developed to replace traditional methods like FTP and SFTP, MFT gained traction by offering enhanced security, control, and comprehensive tracking capabilities.
- Continued Use of MFT Businesses still opt for MFT for its ability to efficiently handle large-sized files and provide detailed insights into data transfers, ensuring compliance with industry regulations.
- Legacy MFT Solutions’ Security Challenges Legacy MFT systems face cybersecurity threats. Modern, secure solutions feature advanced encryption, multi-factor authentication, and detailed access controls.
- Modern MFT Features and Advantages: Automation, detailed workflows, and seamless integration capabilities enhance operational efficiency. Scalability and high availability ensure reliable data transfer, even during peak demand periods.
- Outlook for Managed File Transfer: Modern MFT solutions equipped with robust security features will play a critical role in safeguarding sensitive data amidst escalating cyber threats, promising a secure and efficient channel for data.
How Enterprise Managed File Transfer Works
An enterprise managed file transfer (MFT) solution provides a comprehensive framework for securely and reliably exchanging data. Unlike basic file transfer tools, an enterprise MFT platform orchestrates the entire lifecycle of a file transfer, enforcing security and governance policies at every stage. The workflow is unified under a single, hardened platform that reduces the organizational attack surface.
- Initiation: A transfer can be initiated in multiple ways: manually by a user through a secure web portal, automatically on a predefined schedule, or triggered by an event via an API call from an enterprise application like an ERP or CRM system.
- Authentication and Authorization: Before any data moves, the system verifies the identity of the user or system initiating the transfer. Modern MFT platforms enforce strong authentication, including multi-factor authentication (MFA), and integrate with identity providers like Active Directory or Okta. Once authenticated, the system checks permissions to ensure the user is authorized to send, receive, or access the specific files and folders.
- Encryption (In Transit and At Rest): As the file transfer begins, data is protected in transit using strong encryption protocols like TLS 1.2+. Upon arrival, the data is encrypted at rest using standards like AES-256. The Kiteworks platform ensures this process occurs within a hardened virtual appliance, isolating data from the underlying server to prevent attacks.
- Automated Processing: This is where enterprise MFT provides significant value. The platform can automate complex workflows without custom scripting. For example, once a file arrives from a partner via SFTP, the MFT solution can automatically scan it for malware, move it to cloud object storage like Amazon S3 or Azure Blob, and notify the relevant business system.
- Tracking and Audit Logging: Throughout the entire process, the MFT solution logs every event: who initiated the transfer, what file was sent, when it was sent, who received it, and if it was successfully downloaded. This creates a complete, immutable audit trail necessary for regulatory compliance and forensic analysis. Platforms like Kiteworks consolidate these logs from all communication channels (MFT, email, forms) into a single system, providing the clean, structured data needed for AI-ready governance and advanced security analytics.
Similarly, peer-to-peer file sharing became a prominent feature. This technology enabled direct file sharing between systems, without the need for a central server. The simplicity and speed of this system, juxtaposed with the more complex and time-consuming MFT, made it an appealing alternative for many organizations.
With these new technologies providing faster, more convenient, and cost-effective alternatives, managed file transfer started being viewed as a lagging, cumbersome and ineffective solution by comparison. Managed file transfer couldn’t compete with the efficiency and agility of these newly emerging solutions. Managed file transfer was also viewed as comparatively more complicated to implement and manage, which added to its growing list of disadvantages.
Gradually, the once-favored position that MFT held in tech stacks began to dwindle. Organizations that valued speed, convenience, and cost-effectiveness, started to gradually move away from MFT. The transition wasn’t immediate, but the shift was noticeable and significant.
When and Why Enterprises Look to Managed File Transfer
Despite the availability of more advanced data transfer solutions, there are numerous instances when businesses still turn to managed file transfer. For instance, a significant characteristic that sets MFT apart from other systems is its exceptional capacity to manage the transfer of large–sized files. Why? managed file transfer’s optimized routines and protocols specifically designed for handling high–volume data transfers ensure efficient and reliable transmission of large files.
In addition to its exceptional file transfer capabilities, managed file transfer stands unmatched in its ability to deliver comprehensive end-to-end insights into the entire process of file transfer. This characteristic proves especially necessary for enterprises operating within highly regulated industries. Providing a clear, start–to–finish view of data transfers, managed file transfer enables these businesses to maintain strict compliance with industry regulations like the Health Information Portability and Accountability Act (HIPAA) and the Payment Card Industry Data Security Standard (PCI DSS), by ensuring complete transparency and control over their data movement activities.
There are occasions when the decision to use managed file transfer technology is largely influenced by cost considerations. For instance, certain businesses may have made substantial financial commitments to managed file transfer infrastructure. For these companies, the vast expenses previously incurred in setting up managed file transfer infrastructure may make it prohibitively costly to transition towards the adoption of newer, potentially more efficient technologies. Rather than incurring additional costs, these companies might deem it more financially viable to persist with their existing managed file transfer infrastructure.
Similarly, businesses that rely on outdated, or “legacy,” systems may find that continuing with managed file transfer proves easier and more cost-effective. This is primarily due to potential compatibility issues that could arise when attempting to incorporate newer technologies. Upgrading or changing to a different technology solution might necessitate significant modifications or even a complete overhaul of their system which can be both time-consuming and expensive. As such, the cost-effectiveness and convenience of managed file transfer may make it the preferred choice for businesses, despite the potential benefits of implementing newer technological solutions. This familiarity with managed file transfer technology and its straightforward—albeit dated—operation means less training is required, thereby saving businesses even more resources.
Legacy Managed File Transfer and Cyberattacks
Cybersecurity has emerged as a growing concern for businesses globally, and file transfer systems are often vulnerable targets. Legacy managed file transfer systems typically feature glaring security limitations that, if discovered, can be exploited by sophisticated cybercriminals and rogue nation states.
Recently, there have been notable instances where cyber criminals exploited vulnerabilities in ageing managed file transfer systems for their nefarious objectives.
the limitations of legacy managed file transfer systems were glaringly exposed. The older systems lacked the advanced security features necessary to combat sophisticated cyber threats. It serves as a stark reminder that MFT’s role in modern enterprises has to be reframed. Today’s digital enterprises require innovative managed file transfer solutions that are capable of providing robust data security, granular control over file transfers, and adaptability to various IT environments. Moving away from legacy managed file transfer systems and adopting advanced managed file transfer solutions is the need of the hour to safeguard businesses from ever-evolving cyber threats.
Last year saw two managed file transfer solutions exploited by criminal ransomware gang Cl0p, or Clop. In February, they exploited a zero-day remote code injection flaw in GoAnywhere’s managed file transfer software. The GoAnywhere MFT Zero–day vulnerability exposed administrator consoles that directly connect to the internet rather than routing through virtual private networks (VPN) or through IP-based cloud services like AWS and Azure. In May, Clop began exploiting a previously unknown SQL injection vulnerability in Progress Software’s MOVEit MFT software. They installed a webshell on MOVEit Transfer web applications that enabled the gang to download various information from MOVEit Transfer’s MySQL server and perform various malicious actions. Combined, thousands of businesses and government agencies were breached and millions of end users had their personally identifiable and protected health information (PII/PHI) exposed.
MFT vs. SFTP: Why Managed File Transfer Is Essential for Secure Enterprise Transfers
While Secure File Transfer Protocol (SFTP) is a foundational technology for secure data exchange, it is just a protocol. A modern Managed File Transfer (MFT) solution is a comprehensive platform built around protocols like SFTP, HTTPS, and FTPS to provide the automation, governance, and visibility that enterprises require. Relying on standalone SFTP servers creates security and compliance gaps, as evidenced by breaches where threat actors exploited misconfigured or unmonitored transfer systems. A modern enterprise MFT platform mitigates these risks by centralizing control and security.
Key differentiators include:
- Automation and Integration: SFTP requires complex, brittle custom scripts for automation. Modern MFT provides user-friendly, code-free workflow automation to connect with business applications and cloud storage seamlessly.
- Visibility and Governance: SFTP servers generate decentralized, basic logs. An MFT platform offers a centralized dashboard with comprehensive, immutable audit trails for every transaction, simplifying compliance with regulations like GDPR, HIPAA, and CMMC.
- Security Posture: SFTP encrypts data in transit but offers little else. A modern MFT platform like Kiteworks operates on a hardened virtual appliance, isolating data and services to reduce the attack surface. It adds layers of security like MFA, granular access controls, and integrated threat protection.
Capability | Standalone SFTP Server | Modern MFT (Kiteworks Platform) |
---|---|---|
Centralized Governance | No. Each server is an island. | Yes. Single pane of glass for all policies and controls. |
Automation | Requires complex custom scripting. | Built-in, code-free visual workflow builder. |
Compliance Reporting | Manual log collection and correlation. | Automated, comprehensive audit trails and reporting. |
Security Architecture | Software installed on a general-purpose OS. | Hardened virtual appliance with embedded security controls. |