Data breaches ‘will cost $2.1 trillion by 2019’

Data breaches will cost firms $2 trillion by 2019, according to Juniper Research.

The figure amounts to four times the expected cyber crime cost for 2015, with the analyst house adding that most breaches will come from hackers exploiting existing IT and network infrastructure.

An increasing trend towards digital records and growing use of devices will also contribute to the problem, Juniper said in its report, The Future of Cybercrime & Security: Financial & Corporate Threats & Mitigation.

The figure is 2.2 per cent of the entire world's GDP for 2019, as forecast by the International Monetary Fund, and Juniper estimates an average $6 million bill for companies which suffer cybercrime attacks.

"Typically the most expensive forms of cybercrime are data breaches, those attacks which result in the criminals seizing business or personal records," the report said.

And it warned that exposed SMBs will fare the worst, with the $6 million estimated bill often higher than their annual revenue.

"The cost of cybercrime is disproportionately heavy on smaller businesses. Larger organisations are more likely to be able to weather the resultant costs from a large scale data breach," it stated.

The prediction comes after a spate of data breaches in Europe and the US over the past couple of years.

US retailer Target is in the process of settling a $19 million payout to banks after 40 million MasterCardusers had their details stolen following a hack of Target's payment systems.

Meanwhile, hackers stole 10TB of films, employee records and sensitive emails from Sony Pictures last November likely using the Apple IDs of Sony staff to break in.

Juniper predicted US companies would bear 90 per cent of the costs, due to the high value nature of the attacks.

Guest editor's view

TechUK CEO Julian David says: There's no denying an overall increase in cyber crime around the world. These findings echo our own research which found that currently the majority of threats are known and can be protected against.While criminals will always be looking for new vulnerabilities, even taking basic steps to protect yourself and your business can dramatically decrease the likelihood of a successful attack. However, this report also shows the need for our industry to keep investing in skills and services to combat cyber crime.