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The
total average cost of a data breach is now $3.8 million, up from
$3.5 million a year ago, according to a study by data security
research organization Ponemon Institute, paid for by
International Business Machines Corp.
The direct costs include hiring experts to fix the breach,
investigating the cause, setting up hotlines for customers and
offering credit monitoring for victims. Business lost because
customers are wary after a breach can be even greater, the study
said.
Data breaches are becoming more common and significant, with
high-profile attacks on Sony Corp, JPMorgan Chase and retailers
Target Corp and Home Depot Inc in the past year and a half.
"Most of what's occurring is through organized crime," said
Caleb Barlow, vice president of IBM Security. "These are
well-funded groups. They work Monday to Friday. They are
probably better funded and better staffed than a lot people who
are trying to defend against them."
IBM, which sells cyber-security services to companies, has a
vested interest in highlighting the costs of data breaches.
The cost of a data breach is now $154 per record lost or stolen,
up from $145 last year, according to the study, based on
interviews with 350 companies from 11 major countries that had
suffered a data breach.
The study's authors said average costs did not apply to
mega-breaches affecting millions of customers, such as those
suffered by JPMorgan Chase, Target and Home Depot, which cost
the companies far greater sums. Target alone said last year its
breach cost $148 million.
The study found that the healthcare was most at risk for costly
breaches, with an average cost per record lost or stolen as high
as $363, more than twice the average for all sectors of $154.
That reflects the relatively high value of a person's medical
records on the underground market, said IBM, as Social Security
information is much more useful for identity theft than simple
names, addresses or credit card numbers.
(Reporting by Bill Rigby in Seattle; Editing by Ken Wills)
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