IT Pro is supported by its audience. When you purchase through links on our site, we may earn an affiliate commission. Learn more

Mega data breaches cost megabucks, says IBM

Automation and implementing protocols to deal with breaches are the biggest moneysaver

Data breach

IBM and the Ponemon Institute have revealed that the average cost of a data breach globally is $3.86 million, which is an increase of 6.4% year-on-year.

The reason for such a steep climb is that it is taking longer for businesses to address and fix the data breach, meaning they're without revenue for longer and also, more data records were lost last year compared to previous years the same study took place.

IBM and The Ponemon Institute questioned nearly 500 companies that have experienced a data breach and discovered that it was taking an average of 197 days to identify a breach and an additional 69 days to contain the breach after it had occurred.

The study also revealed that it costs an average of $148 per lost or stolen record on average, but having an incident response team saved companies $14 per compromised record, while the use of AI reduced the cost by $8 and a "rush to notify" policy reduced the per-record cost by $5.

"While highly publicized data breaches often report losses in the millions, these numbers are highly variable and often focused on a few specific costs which are easily quantified," said Wendi Whitmore, Global Lead for IBM X-Force Incident Response and Intelligence Services (IRIS).

"The truth is there are many hidden expenses which must be taken into account, such as reputational damage, customer turnover, and operational costs. Knowing where the costs lie, and how to reduce them, can help companies invest their resources more strategically and lower the huge financial risks at stake."

Dr Larry Ponemon, chairman and founder of Ponemon Institute explained that although the cost of data breaches has risen significantly over the last few years, the uptake of security automation tools was having a positive impact, saving more than $1.5 million on the total cost of a breach.

"While data breach costs have been rising steadily over the history of the study, we see positive signs of cost savings through the use of newer technologies as well as proper planning for incident response, which can significantly reduce these costs." 

Featured Resources

2023 Strategic roadmap for data security platform convergence

Capitalise on your data and share it securely using consolidated platforms

Free Download

The 3D trends report

Presenting one of the most exciting frontiers in visual culture

Free Download

The Total Economic Impact™ of IBM Cloud Pak® for Watson AIOps with Instana

Cost savings and business benefits

Free Download

Leverage automated APM to accelerate CI/CD and boost application performance

Constant change to meet fast-evolving application functionality

Free Download

Most Popular

What's powering Britain’s fibre broadband boom?
Network & Internet

What's powering Britain’s fibre broadband boom?

3 Feb 2023
Dutch hacker steals data from virtually entire population of Austria
data breaches

Dutch hacker steals data from virtually entire population of Austria

26 Jan 2023
Windows 10 users locked out of devices by unskippable Microsoft 365 advert
bugs

Windows 10 users locked out of devices by unskippable Microsoft 365 advert

3 Feb 2023