The Cost of a Data Breach is Substantial
No matter what industry you are in, the cost of a data breach is substantial. The 2015 Cost of Data Breach Study conducted by the Ponemon Insistute found that the average cost for each lost or stolen record rose 8% from the previous year to $217 a record in the United States on average. Last year alone over 1 billion records of personal identifiable information were stolen. This is worrisome for businesses, who will be met with both the direct and indirect costs of a data breach.
The Direct Costs of a Data Breach
The money spent by companies to try and minimize the extent of damage caused by the data breach and to assist victims is referred to as direct costs. Direct costs include the cost of outside services such as legal aid, identity protection services for victims and the hiring of forensic professionals to investigate the data breach. The Ponemon Data Breach Study found that on average in 2015 businesses spent $74 per record on direct costs.
The Indirect Costs of a Data Breach
Much more troubling than the direct costs are the indirect costs that incur when a company suffers a data breach. Indirect cost refers to money spent on internal resources to handle the data breach. In the Ponemon Institute study, it was determined that companies are continuing to spend almost twice as much more on indirect costs than direct costs, averaging $143 per record.
Indirect costs include time spent by employees notifying customers and investigating, high customer turnover and the lasting damage to a business’s reputation. Businesses spend years building brand loyalty, but when a data breach strikes customer turnover is rampant. All the time, energy and money invested in building a trustworthy brand is lost in an instant. Opportunity loss is an additional cost, as acquiring new customers is even more challenging due to a now tarnished reputation.
End of Life Services for Retired IT Assets
Having a certified IT Asset Disposition company like InterConnection in place, is an important first step in preventing a data breach from occurring. Every business should know exactly where and what is happening to their retired IT assets.
InterConnection, an R2 and ISO 14001 certified IT Asset Disposition company provides a wide array of end of life services for retired IT assets such as crushing and shredding hard drives according to the National Institute of Standards and Technology (NIST), as well as performing industry standard 1-Pass and 3-Pass Wipes, chain of custody procedures and providing auditable reports upon request.
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