🛑 Ransomware Reloaded: The Cyber Threat That Won’t Cover Itself (Merlin Attack Pt. 2)

In today's interconnected world, a single click on the wrong link can bring a thriving business to its knees. The pool industry learned this lesson the hard way when Merlin, a major pool cover manufacturer, fell victim to a devastating ransomware attack that continues to disrupt operations weeks later. This cyber catastrophe serves as a wake-up call for pool professionals everywhere about the critical importance of cybersecurity in an increasingly digital business landscape.

The Merlin Ransomware Attack: A Business Nightmare Unfolds

The ransomware attack on Merlin has sent shockwaves through the pool cover industry, leaving dealers and customers in limbo. As Steve explains on the podcast, the impact has been severe and ongoing:

Merlin right now, they can't put it in a new order. So they were like, hey, if you put in your orders before June 23rd, you might be okay. But anything after that, we're kind of screwed.

— Steve, Talking Pools Podcast

This attack highlights the vulnerability of specialized manufacturers in the pool industry. With only a handful of major players like Merlin, Pegasus, and Looplock dominating the cover market, when one goes down, the ripple effects are felt industry-wide. The timing, fortunately, occurred during the slower summer months when cover demand is typically lower, but the implications remain serious for businesses dependent on these products.

Understanding Ransomware: More Than Just a Pool Industry Problem

Ransomware attacks aren't unique to the pool industry—they're a pervasive threat affecting businesses across all sectors. The hosts break down the reality of these attacks in simple terms:

Ransomware is not something that just affects the pool industry. It affects anyone that has any sort of tech going on. So if you have, you know, work computers and work phones and you have some sort of servers that you put your stuff on.

— Steve, Talking Pools Podcast

The vulnerability extends beyond obvious targets. Even companies sharing server space with other businesses can become collateral damage. As Steve points out, unless you're a major corporation like Fluidra, Hayward, or Pentair, you likely can't afford dedicated servers and are sharing resources with other companies, potentially exposing you to risks from their security breaches.

The attack vectors are often surprisingly simple. Cybercriminals exploit human psychology, sending seemingly legitimate links that mimic trusted brands or services. Steve shares his personal vulnerability, describing how he regularly clicks on promotional emails from Merrell shoes—exactly the type of behavior that cybercriminals exploit to gain system access.

The Human Factor: How One Click Can Compromise Everything

The most sophisticated security systems can be undone by human error. Steve's candid admission about his clicking habits illustrates how even security-conscious business owners can be vulnerable:

All you would have to do to get someone like me would be to know what they're actually paying attention to and reading and just send them one of those. And, you know, they're going to click on that all the time.

— Steve, Talking Pools Podcast

This vulnerability exists because cybercriminals have become increasingly sophisticated in their social engineering tactics. They research their targets, understanding shopping habits, business relationships, and communication patterns to create convincing phishing attempts. For busy pool professionals juggling multiple responsibilities, the temptation to quickly click through emails without careful scrutiny is understandable but dangerous.

The attack likely originated from someone within Merlin's organization innocently clicking on what appeared to be a legitimate link, either at work or at home. This highlights the need for comprehensive cybersecurity training that extends beyond the office environment.

Industry Impact: When Specialized Markets Face Cyber Threats

The pool cover industry's concentrated market structure amplifies the impact of cyber attacks. With relatively few major manufacturers serving the entire market, the failure of one company creates significant disruptions. Pool professionals who have worked with cover orders understand the complexity and precision required:

I've put in a cover order before. And I've gotten a cover back. And it's backwards, Wayne, you know, and it's not symmetrical. So now the L piece where the step cut out is on the right side instead of on the left side.

— Steve, Talking Pools Podcast

Custom pool covers are high-value, precision products costing multiple thousands of dollars. The manufacturing process requires exact specifications, and errors are costly for both manufacturers and dealers. When a major supplier like Merlin goes offline, it's not simply a matter of switching to another vendor—each manufacturer has different processes, specifications, and lead times.

The timing of this particular attack during summer months, when cover demand is naturally lower, prevented what could have been a catastrophic disruption during peak season. Had this occurred in late August when fall cover installations begin ramping up, the industry impact would have been significantly more severe.

Protecting Your Pool Business: Practical Cybersecurity Steps

The Merlin attack serves as a crucial reminder that cybersecurity isn't optional for modern pool businesses. As companies increasingly rely on digital systems for everything from customer management to payment processing, the potential impact of cyber attacks grows. Steve emphasizes the importance of professional cybersecurity assessment:

This is a good time to maybe hire somebody and have them take a look at your, you know, your cyber health.

— Steve, Talking Pools Podcast

The costs of cybersecurity measures might seem daunting for smaller businesses, but they pale in comparison to the potential losses from a successful attack. Steve mentions that implementing secure payment processing on their website required additional annual costs of several thousand dollars—a significant expense for a growing business, but essential for protecting customer data and maintaining operational continuity.

Employee training represents another critical component of cybersecurity defense. Regular staff meetings should include discussions about recognizing phishing attempts, safe browsing practices, and the importance of verifying suspicious communications before clicking links or downloading attachments.

Pool businesses should also evaluate their data backup strategies, ensuring that critical business information is regularly backed up to secure, offline locations. In the event of a ransomware attack, having clean backups can mean the difference between a minor disruption and a business-ending catastrophe.

Moving Forward: Building Cyber Resilience in the Pool Industry

The Merlin ransomware attack highlights the interconnected nature of modern business operations and the cascading effects of cyber incidents. For pool professionals, this incident should serve as motivation to evaluate and strengthen their own cybersecurity posture.

Industry associations and trade organizations have a role to play in supporting members through education and resources about cybersecurity best practices. Sharing information about threats and successful defense strategies can help smaller businesses access enterprise-level security knowledge.

As the pool industry continues to embrace digital transformation—from automated pool systems to online customer portals—cybersecurity must evolve from an afterthought to a fundamental business consideration. The companies that invest in robust cybersecurity measures today will be better positioned to thrive in an increasingly connected future.

The ongoing Merlin situation serves as a stark reminder that in today's digital business environment, cybersecurity isn't just about protecting data—it's about protecting livelihoods, customer relationships, and the continuity of operations that keep pool businesses running smoothly. As the industry learns from this incident, the hope is that other companies will take proactive steps to protect themselves before they become the next cautionary tale.

Episode Chapters

• 00:00 Wedding Congratulations and Business Continuity
• 08:30 Pool Startup Best Practices
• 12:45 Merlin Ransomware Attack Discussion
• 18:20 Understanding Ransomware Threats
• 25:15 Personal Vulnerability Examples
• 32:40 Industry Impact and Cover Manufacturing
• 38:25 Cybersecurity Protection Strategies