Data breaches are costly to any organization, especially small businesses. There isn’t any business immune from potential attacks. Within the past year, security breaches have impacted businesses of all sizes — and there aren’t any implications of a slowdown.
In the last year alone, Marriott, Under Armor, Quora, Facebook, as well as Saks Fifth Avenue and Lord & Taylor have felt the destructive effects of data breaches. At each of the companies mentioned, millions upon millions of accounts were impacted. Yet, Yahoo, to this day, still holds the title of the largest reported breach, which occurred back in 2016.
According to the 2018 Cost of a Data Breach Study, conducted by Ponemon Institute, an independent research firm, the global average cost of a data breach in 2018 increased to $3.86 million, up 6.4 percent over the previous year. During the same time frame — 2017-2018 — the average cost for each lost or stolen record containing sensitive and confidential information increased by 4.8 percent to $148. These additional business expenses negatively affected businesses of all sizes and in industries across the board.
The study found several factors impacting the cost of data breaches: unexpected loss of customers following a data breach; size of the breach or the number of records lost or stolen; time it takes to identify and contain a data breach; effective management of detection and escalation costs; and effective management of post data breach costs.
Many are expecting cybersecurity incidents to continue in 2019. In fact, in January 2019, the World Economic Forum published its Global Risks Report for 2019. For the report, the not-for-profit organization surveyed nearly 1,000 decision-makers from the public sector, private sector, academia and civil society about risks facing the world. The survey’s respondents identified technological instabilities as a top risk for this fiscal year.
To be specific, large-scale cyber attacks came in at number five. The overwhelming majority of the survey’s respondents expect increased risks in 2019 of cyber attacks leading to theft of money and data (82 percent) and disruption of operations (80 percent). These growing concerns from decision-makers about potential data breaches are impacting the cybersecurity market by creating the need for answers and solutions.
It isn’t a surprise then that by 2025, the global cybersecurity market is projected to exceed $177 billion, according to Research and Markets’ “Global Cyber Security Market (By Product Segments, Service Segments, Industry Verticals, Geography, Recent Developments) — Forecast to 2025” report, which was published in January of this year.
With regard to industry verticals, the healthcare industry is likely to capture more than 6 percent of the global cyber security market by 2025, according to the study. In 2017, the government sector captured the majority of the global cybersecurity market. Behind the government sector, the banking, financial services, and insurance sector accounted for nearly 22 percent of the market during the same time period. The information and communications technology sector captured nearly 10 percent of the market in 2017.
Data breaches are expected to continue in 2019. In fact, CEOs in the United States rank cybersecurity as their number one external concern for the year. From what it looks like, things are going to get worse before they get better unless SMBs prepare accordingly.