Understanding the Damage Caused by a Data Breach
As more and more awareness is being raised regarding the growing number of data breaches that businesses are suffering from, it is increasingly important to understand the damage that it causes. Many businesses don’t consider this aspect or believe that only big businesses are the ones that are under this threat. This misconception can lead to them having poor or bear minimum security measures
Hackers and scammers are looking these opportunities that allow them to steal data successfully. Around 98% of data breaches are successful and occur in less than a minute. In contrast, only 20% of businesses are aware of this breach. For the other 80%, it can take weeks or more to find out about it. You only have to look at the growing number of cases to see that this is true. Even big companies such as Uber, Yahoo! and FedEx have been blamed for inattention as it took them months and even years to find and address the problems.
The risks associated with data breaches are extremely high and can impact the business as well as their customers. For this reason, it is necessary to understand why it is imperative that to maintain a high level of security from the Internet cloud.
Can Lead to Identity Theft
One of the biggest dangers that come with a data breach is identity theft. Identity theft occurs when the stolen data is utilized by the hacker in any manner to profit from it. This means that they’re using someone else’s social security number, email address, home address, phone number and more to achieve unscrupulous tasks.
In some cases, payment details can also be compromised that can improve the chances of identity theft. It should be noted that not all cases will lead to identity theft. Similarly, the kind of data that is obtained will also make a difference. The data is just compromised as a power move for intimidation, simply stored or accessed, just because the hacker can do it. So, while every data breach might not cause an identity theft, it can increase the chances of that happening.
Loss in Reputation
Any business that experiences a data breach can lose their credibility and their reputation which can be difficult for them to recover from, not to mention lawsuits. While some consumers will give a business another chance, if it happens again and again, the will simply move to another platform where their sensitive data will not be compromised and they won’t face any such risks.
For Example: Consider the case of Yahoo! The company experienced such large data breaches that the platform is largely ignored. They also lost face in the industry because despite having 3 billion users, they had a data breach that compromised all the information of their users’ in their servers.
However, the measures taken by the company when a breach occurs can help to minimize the negative impression created in such a scenario.
For Example: The breach of data that occurred in 2018 of the MyFitnessPal app that is owned by Under Armour was severe and affected around 150 million users. Unlike other businesses, MyFitnessPal detected the problem in a few weeks. They also addressed the problem as quickly as possible by starting an investigation as well as notifying their users and applying appropriate measures to prevent future data breaches.
Theft of Intellectual Property
Loss of intellectual property is a major issue that comes with data breaches. Oftentimes, businesses don’t consider this side of a data breach. They will have the right measures to protect sensitive data but few measures that protect their own data internally. From stealing content, such as blueprints, software and designs, a data breach can leave anything of value available to the business.
For Example: In 2017, the TV network channel, HBO was subjected to a hacker attack that not only caused a data breach but also resulted in the theft of their intellectual property. In this case, the hacker made away with a treasure trove of their data, roughly 1.5 terabytes including episodes from their TV series including The Game of Thrones, Ballers, The Deuce, Room 104 and more.
It should be noted that theft of intellectual property is a punishable crime, even when it occurs during a data breach. The responsible hackers, once identified can be sued. The hacker in this case also got an indictment once his identity was revealed.
The data that is stolen in a breach can be extremely valuable and cause financial loss for the business. Running an investigation is expensive and can cost thousands of dollars as well as cause costs associated with fines, legal fees, liability costs and more. A rough estimate shows that a data breach can easily cause a loss of $117,000 for small businesses. For larger businesses, the cost associated with the breach can be much higher.
In some cases, the business can be given a ransom demand by the hacker on the promise that their stolen data will be returned to them. In this case, it is completely up to the discretion of the business to opt for this.
For Example: During the HBO data breach, the hacker started releasing the content, which largely contained episodes of TV series that hadn’t been released yet. He offered to keep the content safe if he was given $6 million in Bitcoins.
In this case, HBO chose not to pay them and an episode of Game of Thrones was promptly released. This turned out to be a wrong move for them because the viewers loved it so much that when HBO released the same episode on the scheduled day and time, it was one of their highest viewed episodes for the series.
On the other hand, Uber experienced a data breach in 2016, but not only did they choose to keep it hidden for over a year, they paid the hackers $100,000 to get the stolen data deleted and ensure their silence regarding the security breach.
Posted On October 21, 2018