In today’s world, data has value – and data has become a target for misdeeds as well. The number of data breaches of businesses continues to increase yearly. Here, we’ll discuss the rise of data breaches and how they happen. Then, we’ll take a closer look at how much data breaches can cost your business.
How Data Breaches Happen
When many people think of a data breach, they imagine the work of sophisticated hackers, navigating digital security systems to find a secret way in. These images are often based on television and movie portrayals. In fact, the most common origin of a data breach is quite boring. Most data breaches occur when an unauthorized person gains access to an authorized person’s credentials. Often, this access happens without the unauthorized person even trying to steal a username or password – the password’s owner accidentally stays logged in or writes their password on a note they then lose. Another common site of data breaches is smart devices. Smart devices often represent weak links in a network’s security. When a device doesn’t share security features with the rest of the system, it becomes an open door for those who want inside.
The Rising Costs of Data Breaches
A recent IBM report indicates that the cost of data breaches is higher than ever. In 2023, worldwide costs of data breaches reached $4.45 million – higher than the previous record set in 2022 and over 15 percent higher than 2020’s total. Data breach costs become more expensive when:
- An organization has its own in-house security teams or tools. Spotting a breach internally allows companies to take quicker action than if a breach is reported by a third party or an attacker.
- Involving law enforcement where appropriate. During a ransomware attack, companies that involved law enforcement generally lost less money and data than companies that did not, according to IBM.
- Use automated tools. AI-enabled tools can respond more quickly to suspicious activity, which can shorten the time a breach occurs and save a company money.
To address these costs, focus on IT security. Have a plan to respond if an attack occurs. And check your insurance coverage to make sure you have backup if you lose money, data, or other valuables due to a breach.