Data breaches have gained huge attention as the business of every size have become largely reliant on digital data and cloud computing. In a commercial aspect, data is the make or break factor upon which the foundations of a company rests. Only with the help of a proper data analysis, a business can keep track of all its processes from production to sales and identify all the possible errors to ensure their proper and timely removal.
Moreover, all the monetary data from online transactions are more valuable as the overall revenue of a company depends upon that. Loss of such data can affect a company tremendously and might even face untimely shutdown.
What is actually a Data Breach?
In simple terms, the data breach is a practice in which hackers extract sensitive, confidential or similar encrypted data, without the proper consent from the respective authorities/owners. The type of data which are targeted generally includes Personally Identifiable Information (PII), Personal Health Information (PHI), transaction data of a trade, or any such highly sensitive commercial data.
How Data Breaches are done?
Data Breaches is done by a series of steps which are mentioned below:
Searching for weak points
The hackers/cyber-criminals perform research on the system/company they want to hack in. They search for the weak spots in the system and then attack those points for an easy breach.
The friend in disguise
After analyzing the weak spots, the cyber-criminals attack the system with the help of a network or with the use of social media (and sometimes even through the mail).
In this type of cyber-attack, hackers use the weak spots present in the network, system, or infrastructure for infiltrating the network of a business/company.
In this, the cyber-criminals use different types of baits for different employees of a company, in the form of phishing emails, or any other malicious attachments. When the employees click on such attachments, the system gets infected, leading to data breaches.
Once the hackers are successful in accessing the network, they create a network tunnel, and then they perform their final task, i.e., extracting the data. They extract all the valuable information and then use the same tunnel for moving out of the system without being noticed.
Now let us discuss the types of data that are extracted by the cyber-criminals:
- Business-related Data: Includes all the critical information, trade secrets, business transactions, etc.
- Medical Data: These include all the data associated with personal information like addresses, annual income, family details, etc.
- Military Grade Data: Includes all types of critical data associated with the defence wing of a country like sensitive missile launch codes, information about various past and future operations, secrets about the defence wing, etc.
- Financial Data: Includes the extraction of all sorts of financial transactions and banking details of the account holders around the globe.
- Educational Data: This includes the extraction of data associated with the personal information of the students of the concerned institution and all other administrative records.
Data Braches Cost Analysis
According to the research study made by Ponemon Institute and IBM, a data breach in the US can cost a company up to $7.9 million. This is a hefty sum to pay and it imbalances the whole revenue system.
As we are progressing rapidly in this cyber world, data breaches are becoming more and more expensive. While the smaller breaches can cost up to $3.86 million globally, some of the mega data breaches can cost up to $350 million.
According to the studies made by IBM and Ponemon Institute, the average cost of per stolen record is around $160, which makes the average cost of a normal data breach around $4 million.
Data breaches affect a company on multiple levels, some of which are mentioned below:
The data breaches affect the financial stability of a company. The different types of data lost in a breach, when calculated in terms of money, turns out to be a massive sum.
Loss of brand reputation
Brand reputation is a company’s most prized asset. Business always works constantly to build and maintain the virtue of its brand. The news of data breach negatively impacts the company’s brand value which affects the trust of your potential customers.
In case of certain companies which are mainly from the healthcare and insurance sectors, are bound to pay huge sums of money as fines, on account of any data breach. This is done because the company is bound to keep all the vital information about its customer’s safe, failing which they will be heavily fined.
This is probably the most important loss of a Data Breach. When the sensitive information, business plans, and trade secrets are exposed to its rival companies, the concerned company loses its edge in the competition. The rival companies make use of the data collected to maximize their income.
These losses are something which cannot be quantified. Loss of opportunities and loss of brand value can ultimately lead to the closure of a company. The companies should focus more on the elimination of their vulnerabilities in their system, network, and infrastructure to eliminate the chances of hackers infecting the system.
Data Breaches are becoming more often these days due to the advancements made. Proper care should be taken to implement necessary cyber-security and prevent all types of data breaches.
Aditya works as a Growth Assistant at AirTract.Com, a social platform wherein people ask questions, read and write articles, share knowledge and experience. He has a Bachelor’s Degree in Computer Science Engineering and has been working in the field of Digital Marketing for the past two years. He is also a voracious reader and a big sports fan.