Fewer Companies Suffer Security Breaches, But They're Much More Severe

September 21, 2007 04:51 PM

Sharon Gaudin


A CompTIA study also showed that one in four companies surveyed indicated that they have had an insider security breach or threat in the last year.

The number of companies suffering security breaches has dropped over the last two years, but the severity of the breaches has doubled, according to a new study.

The Computing Technology Industry Association (CompTIA) released a study showing that 66% of the 1,070 organizations surveyed said they did not have a security breach in the previous 12 months. That's a slight improvement from the 61.8% who said the same thing last year and the 42% who said it two years ago.

Jericho says, "...that they know of"

However, while the number of incidents has dropped, the severity of those attacks has gone in the opposite direction.

CompTIA reported that respondents rated the severity level of their security breaches at a 4.8 on a 0 to 10 scale, where 0 is not at all severe and 10 is very severe. Last year the severity rating stood at 2.3 and the year before that it was 2.6.

Jericho says, "By whose estimation? There is a clear history of companies downplaying breaches to save face and customer confidence."

"People have learned that any type of breach is a catastrophe in the making," said Steven Ostrowski, a spokesman for CompTIA, in an interview. "What we've seen is more attention being paid to securing information and networks and intellectual property."

The study comes out about a week after TD Ameritrade Holding disclosed that a hacker broke into one of its databases and stole personally identifying information for some of its 6.3 million customers. And just two days ago, the State of Connecticut announced it is suing its own computer consultant, Accenture, for losing personally identifying information on 58 residents and hundreds of state bank accounts and purchasing cards.

Ostrowski acknowledged that it certainly doesn't appear that companies and government agencies are having fewer security breaches. The issue, he added, is that before laws compelled companies to come clean about break-ins, the public simply wasn't always told that it happened.

"That's why you're seeing all these situations getting more publicity," he noted. "Maybe IT also is getting better at catching these things."

The survey also showed that nearly one in four companies indicated that they have had an insider security breach or threat in the last year. Ostrowski contends that insider risk is growing because more and more employees are working from home or on the road.

"The concern about internal breaches is growing greater, especially with the number of remote workers growing," he said. "Every time you have someone connecting from outside the organization's four walls, it's another risk."

As for the financial damage caused by all kinds of breaches, the average cost across all companies surveyed is $369,388, reported CompTIA. That cost, however, is driven upwards by a handful of companies that estimated security breach costs to be in excess of $10 million. This, noted the report, reflects the higher risk that larger companies face.

About half of respondents estimated the cost of their security breaches in the last 12 months to be $10,000 or less.

Here's how the companies broke down the costs of a security breach:

-- Employee productivity impact, 35%;

-- Server or network downtime, 35%;

-- Impact on revenue-generating activities, 20%;

-- Impact on physical assets, 17%, and

-- Legal fees and fines, 8%.

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