Friday, 13 May 2011 09:45

Data breach costs average $2 million

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Data breaches can be costly. A new study suggests the average cost of a significant breach in Australia is around $2 million.


A study by Symantec and the Ponemon Institute has found that the average cost of "significant" data breaches reported by Australian organisations is around $2 million.

But even if the lost data is about you or your organisation, you probably didn't hear about it: only 37% of cases were notified to the subjects of the data within a month. At least that's a six percentage point improvement from last year.

The most frequent cause of data breaches was third-party mistakes. Furthermore, the average cost of such breaches was $159 per record compared with $128 for all kinds of breach.

Other relatively expensive types of breach involved criminal attacks and lost or stolen devices.

Symantec recommends the following practices:

Assess risks by identifying and classifying confidential information

Educate employees on information protection policies and procedures, then hold them accountable

Extend these policies to any third parties that manage customer information; conduct regular audits and monitoring

Deploy data loss prevention and endpoint security technologies that enable policy compliance and enforcement

Encrypt mobile devices, including laptops and smartphones, to minimise the consequences of a lost device

Integrate information-protection practices into businesses processes

CONTINUED



"This report comes at a time when organisations in Australia and worldwide are under close scrutiny over the measures they have implemented to protect customer and corporate information," said Craig Scroggie, vice president and managing director, Pacific region, Symantec. "It also highlights the need for legislative reforms that require companies to notify their customers of a data breach to be fast-tracked in Australia."

The study involved interviews with multiple individuals at each of 19 Australian companies that had experienced data breaches. The companies were involved in nine different industries.

The cost figures include expenditure on detection, escalation, notification and after-the-fact response, plus the impact of lost or diminished customer trust as measured by customer churn or turnover rates.


 


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Stephen Withers

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Stephen Withers is one of Australia¹s most experienced IT journalists, having begun his career in the days of 8-bit 'microcomputers'. He covers the gamut from gadgets to enterprise systems. In previous lives he has been an academic, a systems programmer, an IT support manager, and an online services manager. Stephen holds an honours degree in Management Sciences and a PhD in Industrial and Business Studies.

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