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IBMs Cost of a Data Breach Report finds invisible cyber tax

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With regards to operational challenges, few mistakes are as costly as data breaches. Just one single exploited vulnerability can result in millions in damages, not only because of upfront disruption, but lack of respect from consumers, and potential compliance liabilities.

Unfortunately, the price of a data breach is increasing. Today, IBM Security released its annual Cost of a Data Breach report conducted by Ponemon Institute, which discovered that the expense of a data breach in 2022 totalled $4.35 million a rise of 2.6% since last years total of $4.24 million.

The study also discovered that organizations that fell victim to cyberattacks were prime target for follow-up attacks within a haunting effect, with 83% of organizations studied having had several data breach.

For enterprises the report highlights that new approaches must mitigate the impact of data breaches, particularly when confronted with an increasing number of sophisticated attacks, which cant continually be prevented.

The hostile reality of the threat landscape

Because the cost of a data breach continues to go up amid a threat landscape of rampant double and triple extortion ransomware attacks and identity-related breaches, its becoming more and more clear that traditional methods to enterprise security have to be reevaluated.

Within the last week alone, T Mobile and Twitter discovered the price of a data breach first hand with the former agreeing to cover customers $350 million within a post-breach settlement, and the latter suffering the negative fallout following a hacker claimed to possess accessed data on 5.4 million users.

With the impact of such breaches causing millions in damage, many organizations decide to pass costs onto consumers, within a low profile cyber tax. Actually, IBM discovered that for 60% of organizations, breaches resulted in price increases offered to customers.

What sticks out most in this years finding is that the financial impact of breaches is currently extending well beyond the breaches organizations themselves, said Head of Strategy, IBM Security X-Force, John Hendley.

The price is trickling right down to consumers. Actually, in the event that you consider that several companies inside a supply chain could have suffered a breach and increased their prices, theres this multiplier effect thats ultimately hitting the consumers wallet. Essentially, were now realizing a concealed cyber tax that folks are paying due to the growing amount of breaches occurring today compounded with the more obvious disruptive ramifications of cyber attacks, Hendley said.

When asked why the expense of data breaches continued to cultivate, Hendley explained that theres a higher level of attacks occurring, but just a limited amount of skilled security professionals open to react to them.

That is highlighted in the study with 62% of organizations saying they werent sufficiently staffed to meet up their security needs.

Do you know the implications for CISOs and security leaders

Even though report highlights the bleakest of the existing threat landscape, in addition, it points for some promising technologies and methodologies that enterprises may use to reduce the expense of data breaches.

For example, probably the most promising findings was that organizations with fully deployed security AI and automation can get to cover $3.05 million less throughout a data breach, and normally cut the time and energy to identify and include a breach by 74-days.

Simultaneously, organizations that implement zero trust can get to cover 1 million less in breach costs than the ones that dont.

Finally, those organizations maintain an incident response team and regularly tested IR plans can get to slice the cost by $2.66 million.

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