When it comes to annual costs for PCI assessments, not all engagements are created equal: Larger, Tier 1 merchants pay an average of $122,000 more, according to a survey of PCI qualified security assessors (QSAs) released today.

The Ponemon Institute, which was commissioned by encryption firm Thales e-Security for the survey, says Tier 1 merchants pay around $225,000 annually to confirm their PCI compliance. The average cost to a Tier 1 merchant is $204,000 for an on-site QSA assessment, versus $103,000 for smaller, Tier 2 merchants.

"QSAs feel they are adding value and identifying issues that, when remediated, improve the security posture of their clients," says Larry Ponemon, chairman and founder of the Ponemon Institute. "But it is expensive: Companies are paying more than an extra $1,000 to achieve PCI compliance. For companies that are struggling on the resources side, this seems to be a large amount of money."

Not all Tier 1 companies are especially large: It may just be that they conduct a lot of credit card transactions, he says. "The cost of certification wasn't appropriate to the size of the organization," he adds.

Ponemon says other companies spent less than $50,000 per year for their assessments.: "But are they getting a Yugo versus a Mercedes? Is there a quality difference?"

Among the 155 QSAs surveyed by Ponemon, more than 40 percent predict that tokenization technology will be included in the next version of PCI DSS, due to be released in October. Nearly 30 percent say end-to-end encryption is most likely to be part of the new PCI version; virtual terminals, 13 percent; and magnetic stripe imaging, 9 percent.

And 60 percent of QSAs say encryption is the most effective way to protect payment card data on an end-to-end basis. More than 40 percent consider managing encryption-key access the biggest challenge faced by merchants deploying encryption.

The current version of PCI DSS doesn't specify how encrypted data should be handled in audits. "Something that's expected [in the next version] is more clarification on the use of encryption and key management, and what organizations need to do to secure the process," Ponemon says.

A full copy of the report is available for download here.

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