29 May 2018 | Christine Baird
Cybersecurity is a global risk for all companies, especially in the U.S. which bears the highest costs to companies, and in all sectors, including financial, retail, services, and real estate.
In the annual study conducted by Ponemon Institute and sponsored by IBM Security, the in-depth study indicates that the average cost of a data breach is currently $3.62 million globally.
IBM and Ponemon Institute 2017 Cost of Data Breach Study: Global Overview
U.S. has hit an all time high at $7.35 million, a 5% increase compared to last year.
In the U.S. alone, data breaches cost organizations an average of $225 per record compromised.
A comparison of the data implies that regulatory activities in the U.S. could cost businesses more per record when compared to Europe, with compliance failures costing U.S. businesses 48% more than European companies.
U.S. companies reported paying over $690,000 on average for breach related notification costs – more than double the amount of any other country.
When it comes to data breaches, time is money – According to the study, the speed at which an organization can suppress a data breach incident has a direct impact on the financial consequences. The cost of a data breach was nearly $1 million lower on average for those organizations that were able to contain a data breach in less than 30 days.
For the third year in a row, the study found that having an Incident Response (IR) team in place further reduces the cost of a data breach, saving more than $19 per record.
There are other financial costs to bear, including additional security such as pen testers, consultants, security vendors, PRs and lawyers, litigation and fines by data protection authorities.
U.S. organizations pay the highest price for losing customers after a data breach
According to Figure 17, the cost of lost business was particularly high for U.S. organizations ($4.13 million). This cost component includes the abnormal turnover of customers, increased customer acquisition activities, reputation losses and diminished goodwill.
The cybersecurity experts know that all companies, globally, small to large, are at risk of data breaches and say the best course of action is to be a prepared.
To read the full report, download the Ponemon/IBM report here.