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Small And Midsize Businesses Getting Serious About Security, Study Says

Forty-two percent of SMBs have lost data; average cost per breach is more than $188,000

Once viewed as easy marks by hackers and cybercriminals, small and midsize businesses (SMBs) are fighting back, according to a study published today.

According to a report (PDF) conducted by Applied Research and published by Symantec, SMBs' attitudes about security and data integrity have changed significantly over the past year, resulting in higher prioritization of security issues and more spending on technology.

"Last year when we conducted this survey, a lot of SMBs were very confident in their security posture, but they weren't always clear on the threat," says Monica Girolami, senior product marketing manager at Symantec, who worked with Applied Research on the study. "This year they realize that they have gaps in their security stance, and they're getting more serious -- in fact, they rated data loss and cyberattacks as their top risks, even above natural disasters."

In the study of 2,500 executives with responsibility for IT security -- half from companies of less than 100 employees and half from companies in the 100-to-499 employee range -- the researchers found new concern over the risk of data loss.

The respondents ranked data loss and cyberattacks as their top business risks, ahead of traditional criminal activity, natural disasters, and terrorism, according to the report. SMBs are now spending an average of $51,000 a year -- and two-thirds of IT staff time -- working on information protection, including computer security, backup, recovery, and archiving, as well as disaster preparedness.

Loss of critical business information threatens SMBs, Symantec says. Seventy-four percent of the respondents said they are somewhat or extremely concerned about losing electronic information. In fact, 42 percent have lost confidential or proprietary information in the past. All of the companies that lost data reported seeing direct financial losses, such as lost revenue or costs in money or goods. One of the main issues for SMBs is lost devices. Almost two-thirds of businesses polled said they had lost devices -- such as laptops, smartphones, or iPads -- in the past 12 months. All of the respondents have at least some devices that have no password protection and cannot be remotely wiped of their data. SMBs also are worried about cyberattacks, the study says. Seventy-three percent of the respondents were victims of cyberattacks in the past year. Thirty percent of those attacks were deemed somewhat or extremely successful. All of the victims saw losses -- such as downtime, loss of important corporate data, or loss of personally identifiable information of customers or employees. These losses led to direct costs for all respondents, such as lost productivity, lost revenue, and loss of customer trust, the researchers said.

The average cost of a breach in an SMB was $188,242, according to the study.

SMBs that fear such breaches and costs should take precautions in the near term, Girolami says. "Educate your employees on the threats," she advises. "Identify your most sensitive data, find out where it's stored and protect it. Secure your email and Web assets."

SMBs are beginning to recognize that they can be targeted just as easily as their larger counterparts, Girolami says. "In fact, they may be even more at risk, because in general, they don't have as many resources to fight back," she says. "But they're moving in the right direction."

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Tim Wilson is Editor in Chief and co-founder of Dark Reading.com, UBM Tech's online community for information security professionals. He is responsible for managing the site, assigning and editing content, and writing breaking news stories. Wilson has been recognized as one ... View Full Bio

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