Ready for some good security news? According to a study sponsored by IBM and conducted by Ponemon Institute, the cost of a data breach actually went down by 10% in 2017. The good news isn't evenly distributed, of course, and there are little nuggets of negativity sprinkled across the upbeat facts of the headline.
The information in Ponemon Institute's 2017 Cost of Data Breach Study: Global Overview shows that, for the first time, the cost of a data breach has gone down from the previous year, to $141 per lost or stolen record (or an average of $3.62 million per incident). The reduction wasn't uniform across all countries and regions, though; Europe saw a 26% decrease in incident costs while US costs rose by 5%, to an average per-incident tab of $7.35 million.
When IBM looked at the difference between nations and regions, they found one compelling factor: regulations. The facts around regulations won't offer vindication either to pro-regulation or pro-free-market advocates. While fewer regulations didn't correlate with lower costs, more uniform regulations did.
Specifically, companies in the US spent more for compliance failures and on notification to affected users than their counterparts in Europe, at least partially due to the fact that 48 states have individual laws and regulations concerning how companies must deal with data breaches. According to the report:
...compliance failures cost U.S. businesses 48 percent more than European companies, while rushing to notify cost U.S. businesses 50 percent more than European companies. Additionally, U.S. companies reported paying over $690,000 on average for notification costs related to a breach -- which is more than double the amount of any other country surveyed in the report.
While not a cost that varies by region, Ponemon's study did find two more significant factors in the cost of a breach. The first? Response time.
This study isn't the first to find a relationship between response time and breach cost -- we've covered similar conclusions here at Security Now. The new report does put a price tag on lethargy, saying that a breach that takes more than 30 days for detection and response costs, on average, more than a million dollars more than a breach met with a fast response.
The numbers become even more significant when combined with the average time for an organization to respond to a breach. According to the report, "On average, organizations took more than six months to identify a breach, and more than 66 additional days to contain a breach once discovered." This means that business, as a whole, is leaving millions and millions of dollars on the table simply because they have not yet put the organization and infrastructure in place to detect and remediate breaches quickly.
There will certainly be more studies on the cost of IT breaches. That's not in question. What is in question is whether the business community, in partnership with government, will work to reduce the cost of those breaches before they grow to become a major drag on profitability.