The Economic Impact of UK Cyber Crime
Date: Nov 9, 2014
Guest Blog: Acumin.
With high profile stories about data breaches and cyber attacks publicised almost every week by Britain’s media, it’s not surprising that many of us are wondering about the financial implications for the companies involved.
However, at Acumin, we’ve seen how cyber crime comes with a significant ripple effect that harms the UK economy as a whole, which is why we’ve published an infographic on the subject.
When putting the £27bn impact of UK cyber crime into perspective, we discovered that the fiscal repercussions were equivalent to the GDP of Tunisia (judging by the International Monetary Fund’s 2013 estimations) or a shopping spree for 27 million MacBook Pros.
Research is unanimous in highlighting the fact that cyber crime has a widespread effect on companies in various sectors. Taking members of the Federation of Small Businesses (FSB) as a cross section of the UK’s SMEs, data shows that smaller companies bear around £785m of the overall cyber crime burden. Spread evenly across all the country’s SMEs, the cost stands at about £4,000 per business. Extortion alone accounts for £12m – £24m of the total figure, and between May 2012 and May 2013, almost half (about 49%) of FSB members reported suffering a data breach.
Of course, computers have been around for decades and cyber crime has existed in some form or other for years, but it’s only in the last 10-15 years that its effects have become so widespread. Those who are unsure why, need only consider the world’s digital connectivity; around 294 million emails and five billion texts are sent every day. Further, 35 hours of footage is uploaded to YouTube and 35,000 tweets are posted every single minute – and here we’re just talking about two leaders in their fields without considering the numerous other video and social media sites. Half of us are on Facebook and about a quarter on Twitter, and we now spend a colossal amount of money online (in 2013 alone, Brits spent about £91bn on the Internet).
In the business world the situation is the same, as around 90% of companies have an internet connection. However, web security firm Kaspersky Lab says they are “woefully under-prepared” to deal with a digital assault, and a survey the company carried out supports its assertion. It was found that about a third wouldn’t know what to do, while a quarter wouldn’t know how to retrieve lost data and about 10% think a cyber attack would spell the end of their business.
Most alarmingly, despite the fact that attacks hit numerous businesses across a range of sectors, the majority (about four out of five) displayed an ostrich mentality, believing that their business does not present a target for hackers.