This week's Cyber Storm III exercise, backed by the U.S. Department of Homeland Security and involving industry leaders, federal and state agencies and foreign governments, will be the largest conducted, organizers said.

The exercises follow by nearly a year a cybersecurity awareness campaign launched across the United States last year and since emulated in other countries.

The participants' list indicated the scope for international expansion of the exercises is large.

Of the countries participating -- Australia, Britain, Canada, France, Germany, Hungary, Japan, Italy, the Netherlands, New Zealand, Sweden, Switzerland and the United States -- none are from Central or South America or from Africa, Asia or the Middle East, where security experts reported recent upsurge in cyberthreat incidents.

With new threats cropping up in cyberspace every now and then, new solutions are constantly in demand -- a growth area for the security industries but a headache for funding agencies, which find budgeting for contingencies a challenge of almost immeasurable proportions, analysts said.

The Cyber Storm exercises simulate large-scale cyberattacks on the U.S. government and the nation's critical infrastructure, such as energy grids and nuclear power plants, to test the response of government and industry cybersecurity personnel.

The Cyber Storm III exercise this week includes participants from seven federal agencies, 11 states, 60 private companies, and 12 international partners. The last exercise two years ago, Cyber Storm II, had the same number of federal agencies participating, nine states, 40 private companies and only four international partners.

The growth in the number of corporate participation indicated industry optimism the exercise could lead to or generate new business for in the coming months. Continuing political uncertainties have kept the security industry operations ticking along, although there's most security of spending in government and corporate sectors, analysts said.

This year's exercise will test out the recently developed National Cyber Incident Response Plan, a government blueprint for cybersecurity incident response, as well as the new National Cybersecurity and Communications Integration Center in Arlington, Va., in October 2009.

"The Cyber Storm III exercise scenario reflects the increased sophistication of our adversaries, who have moved beyond more familiar Web page defacements and Denial of Service attacks in favor of advanced, targeted attacks that use the Internet's fundamental elements against itself -- with the goal of compromising trusted transactions and relationships," a Department of Homeland Security fact sheet said.

"The scenario will incorporate known, credible technical capabilities of adversaries and the exploitation of real cyber infrastructure vulnerabilities, resulting in a range of potential consequences -- including loss of life and the crippling of critical government and private sector functions," said the fact sheet.

Industries represented at Cyber Storm III include banking and finance, chemical, communications, dams, defense, information technology, nuclear, transportation and water supply.

Last week government plans for monitoring hostile cyberactivity from space advanced further with the launch of the first Space Based Space Surveillance satellite.

The SBSS Block 10 satellite, built for the U.S. Air Force by a Boeing-led team, was launched by an Orbital Sciences Minotaur IV rocket.

Analysts said the successful launch of the SBSS satellite moved to a new level issues of space security amid a global proliferation of space satellite technology, now increasingly available to both friends and adversaries of the United States.

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