As businesses become more digitalized — incorporating the online world into their business functions – they slowly become more at risk of cyber crimes. Cybersecurity in most businesses is very lax, which is why the number of data breaches is growing with each passing year. In fact, around 100% of data breaches are done within 1 minute and 98% of them are successful.
The threats that a data breach can pose for businesses are huge because they don’t just impact the business, but their customer base as well. The following are the most major threats that a business can face.
Identity Theft
As soon as hackers and scammers get access to sensitive data, one of the first major threats is the chance of identity theft. Even if the hackers don’t make use of this information themselves, they will sell it on the internet to the highest bidder or expose it online for everyone.
This usually includes sensitive data such as the social security number, the phone number, home address, email address and at times, even credit card information. While not all data breaches can result in identity theft, the chances are still very high of it happening.
Loss of Intellectual Property
Many data breaches can result in theft, largely of intellectual property of the business, which is a punishable crime. This sensitive information can contain files, blueprints, designs, themes, software and more. Often times, businesses might have measures in place that safeguard the sensitive data but overlook their intellectual property.
The biggest example of this is the hacking attack that HBO suffered in 2017. Hackers made away with around 1.5 terabytes of data, including unaired episodes from their TV shows. This data breach was classified under theft of intellectual property and the hacker and his team were indicted when they were identified.
Loss of Credibility and Financial Loss
Many businesses that undergo a data breach face loss of credibility, particularly since the consumers don’t have any more faith in the business being able to safeguard their sensitive data. In short, a data breach is a huge intrusion of trust, particularly since companies often spot them when they are too late. Around 20% of companies can spot a data breach as soon as it happens. The other 80% only become aware of a data breach a few weeks or at times, even a few months after the initial attack happens.
The loss of credibility can also translate into causing a financial loss for a business. In 2017, a study done by Ponemon Institute LLC and IBM Security showcased that on a global level, a data breach costs a business a total of $3.62million, coming in at $141 per stolen record. While this number has decreased by 10% from the numbers garnered in 2016, researches noticed that businesses are suffering from bigger data breaches. The surprising thing to note here is that while big businesses can bounce back from these attacks, smaller businesses have a tendency to go bankrupt within 6 months after a data breach.
At the end of the day, businesses have to be more vigilant and pay attention to their cybersecurity measures.
