The cost of a data breach
According to Ponemon’s 2018 Cost of Data Breach Study, the average cost of a data breach is $3.86 million (around £2.95 million), with an average cost of $148 (around £113) per lost or stolen record.
But what factors contribute to this cost?
As well as having to pay hefty fines for suffering a breach, there are costs associated with reputational damage, customer loss and fall in stock price, not to mention the resources needed to recover from the incident and return to ‘business as usual’. By looking at some of the best-known data breaches, we can observe the effects they can have and how much they really can cost.
Equifax
The 2017 Equifax data breach saw at least 147.9 million people’s personal data compromised. According to Equifax’s financial report for the first quarter of 2018, the breach had cost the company $242.7 million (around £185 million), plus another £500,000 in fines from the UK’s ICO (Information Commissioner’s Office) in August 2018. Equifax also suffered an 18% drop in share price following the breach.
Uber
In 2016, Uber suffered a data breach that affected 57 million customers and drivers. Uber initially paid $100,000 (around £76,500) to the criminal hackers to try and cover up the breach, but disclosed it a year later. It now faces a bill of $148 million (around £113 million) in settlement fees.
Yahoo
In Yahoo’s 2014 data breach – one of the biggest data breaches on record – a whopping 3 billion customer records were stolen, significantly more than initial estimates that only 500 million customers had been affected. This breach resulted in Verizon reducing its offer to buy the company by $350 million (around £268 million).
TalkTalk
Back in 2015, TalkTalk suffered a cyber attack at the hands of a 17-year-old who compromised more than 400 million accounts. This breach cost the company £60 million, and resulted in the loss of 101,000 customers.
Target
Target’s 2013 data breach resulted in the theft of 40 million payment details and 70 million other customer records. The total cost of the breach was $252 million (around £193 million).
All of these breaches occurred before the EU’s GDPR (General Data Protection Regulation) was enforced. With the GDPR now in effect, the penalties alone can stack up to €20 million (around £17.5 million) or 4% of global annual turnover, whichever is higher.
Are you prepared?
The more you prepare your organisation for a breach, the smaller its impact, should one occur. Our free white paper ‘Cyber criminals never give up – nor should you!’ can help check your readiness and improve your breach readiness. Download it here.
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Find out more about protecting your organisation from a data breach
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*** This is a Security Bloggers Network syndicated blog from Vigilant Software Blog authored by Nicholas King. Read the original post at: https://www.vigilantsoftware.co.uk/blog/the-cost-of-a-data-breach/
