As if 2020 wasn't already a tough year for IT teams across the world. According to IBM and the Ponemon Institute's 2021 Cost of a Data Breach Report, a long-running annual study based on more than 500 separate data breaches that experts around the world look to, the cost of the average data breach has gone up from 2020. In fact, the metric now stands at a record high.
While the demands of cybersecurity teams have long been high, the report may serve as a wake-up call for some organizations to invest even further and give their workers the resources they need to stop cybercrime. The costs of not doing so, according to the report, could be enormous.
A costly issue
You already know that data breaches can be expensive, but their price tag continues to increase. According to the 2021 Cost of a Data Breach Report, the average cost of a single breach now stands at an astounding $4.24 million per incident, a 10% increase from 2020. Some of the industries with the most expensive data breaches included health care, pharmaceuticals, hospitality and the manufacturing supply chain. Notably, all of these industries were highly susceptible to expensive data breaches last year as well, in part because of how heavily they were impacted by the COVID-19 pandemic. Other commonly hit industries included financial services, retail and the public sector.
Some of the top drivers of data breaches this year have included compromised login credentials, vulnerabilities during cloud migration and other risk factors associated with remote work. The most frequent kinds of data exposed, meanwhile, included customer names, email addresses, passwords and — in the case of the health care industry — medical records. The impact of compromised consumer information can be long-reaching and lead to losses for all involved, while also potentially prompting victims to file class-action litigation.
The report was put together by the Ponemon Institute, with financial backing from IBM and based on more than 500 separate data breaches.
The second year of serious threats
While some of the numbers from this year's Cost of a Data Breach Report may seem historic, they're simply an extension of an ongoing trend. Data breaches in 2020 were also incredibly expensive.
The report suggests that the two-year spike in breaches has been in part fueled by COVID 19 pandemic. At the beginning of the pandemic last year, IT teams dealt with new vulnerabilities and added chaos as employees largely moved from the office to remote setups. This led to new and rapid cloud adoption or upscaling, with cybersecurity protocols failing to keep up. In fact, the 2021 study found that breaches tended to cost over $1 million on average when remote work was one of the causes.
"Higher data breach costs are yet another added expense for businesses in the wake of rapid technology shifts during the pandemic," said Chris McCurdy, Vice President and General Manager, for IBM Security, in a press release accompanying the report.
Some of the top mitigating factors suggested by the study included AI tools, encryption and advanced security analytics. Additionally, IBM noted that cloud users who invested in a hybrid model were had a lower cost per breach on average. McCurdy described all of these factors as "positive signs" that may "pay off in reducing the cost of these incidents further down the line."
Cybersecurity you can rely on
The newest Cost of a Data Breach report highlights the importance of investing in sturdy cybersecurity infrastructure, whether you're a small business just getting starting or a larger enterprise. The long-term savings of avoiding a breach could be enormous. One of the easiest and most important ways to shore up your network is by ensuring all of your applications are protected by modern, secure identity frameworks. This can include multi-factor authentication, and some vendors are even moving to integrate biometric recognition technologies such as fingerprint readers.