In 2011 (the last year for which we have reliable data), 4.9% of U.S. adults were victims of some kind of fraud. All of that fraudulent activity cost our economy $18B in a twelve month period. To put that number into perspective, it was roughly equivalent to NASA’s funding for the same Fiscal Year. It represents almost half of the United States regular funding for State Department and Foreign Aid in 2012.
It is, to make a long story short, a LOT of money.
$48 Billion Dollars was lost due to data breaches in the year included in the sample set of data used for this study. That means that the Health Care Industry bled out almost $10.5 billion dollars to security breaches and other kinds of data or hardware loss. The Education Industry (the hardest hit by lost laptops) lost $9.6 billion. Sony - one of the most publicized data breaches that occurred during the year the sample set was taken - $1B dollars alone. Different kinds of data breaches effect different businesses. And the expense will vary depending on the nature and depth of the breach, as well as the nature of the data that is stolen. Is the data internal or does some of it belong to your customers? Is the thief a random hacker or is the breach an intentional act of corporate espionage commissioned by one of your competitors?
One of the studies conducted by Intel in partnership with Ponemon showed that a single laptop might cost an organization up to $56,000! In that study, a majority of the laptops not encrypted (45%) were carrying confidential data. These exposures of confidential data through theft accounted for the majority of the expense that hit the companies in this portion of the study. Of the $56K price tag on a lost laptop in this study, $49K of the expense was due to the data breach not to the replacement of the hardware.
How could this loss of capital, consumer trust and opportunity cost have been prevented? According to industry thought leaders in Data Security for business at Druva:
25.5% of this revenue loss could have been prevented by SOURCE DATA ENCRYPTION.
38.2% of this revenue loss could have been prevented by DATA ACCESS CONTROL.
25.5% of this revenue loss could have been prevented by SECURE LAPTOP BACKUP.
7.2% of this revenue loss could have been prevented by none of the above.
The story of the Billion Dollars Hole in America’s coming from Lost Laptops told by the Ponemon and Intel study is a cautionary tale - especially for Enterprise Businesses. Across all groups, an average of 7% of all employees lost their laptops before the machine’s projected life-cycle completed. The study states that, “Organizations with 10,001 to 25,000 employees appear to have the highest rate of laptop loss”. In other words Enterprises are liable to see the most money bleeding out of their bottom line as a result both of lost hardware and resulting data breaches. Legacy backup systems are, frankly, no longer adequate to the needs, liabilities and contingencies faced by businesses - especially enterprises.