What is the Financial Impact of a Ransomware Attack? - NETSERVE365

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Financial Impact of a Ransomware Attack
April 25, 2017
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What is the Financial Impact of a Ransomware Attack?

Scenario: Your system locks up, your files are suddenly encrypted and inaccessible, and a message pops up that demands a ransom payment for decryption.

A ransomware nightmare has happened and you have become the target. Unfortunately, this isn’t a nightmare that you can wake up from. The ransomware attack is in full force and it is holding your sensitive information for ransom.

In the past year, ransomware has reached a new level of maturation as cyber criminals target consumers and businesses. Attacks can have a major impact on business continuity, productivity, and reputation – not to mention your bottom line. Ransomware has exploded in 2016 to a billion-dollar industry and the trends don’t show any decreasing growth.

Businesses need to be fully aware of the threat posed by ransomware and make IT defenses a top priority. Targeted attacks on businesses are becoming more frequent. According to Kaspersky, attacks on businesses increased 3x in 2016 and every 40 seconds a company gets hit with ransomware. This shift is almost certainly profit driven. Infecting a business represents a much larger payday, especially if the ransomware attack can disrupt critical systems and sensitive data.

 

The financial impact of a ransomware attack

Ransomware is popular because it can be easily disguised and can fool the victim. Without the proper defenses in place, cyber-criminals can get anywhere from hundreds to thousands from organizations by encrypting valuable data. In 2016, the average ransom was $679, which is more than double the previous year, 2015, at $294 according to Symantec’s Ransomware and Businesses 2016 report.

Cost of Ransom:

It is advised to never pay the ransom, but many organizations still do. The ransom paid average has more than doubled since last year which makes us think that cyber criminals think that victims will pay and they can demand more because of it. However, something to consider is that if you pay the ransom, there’s no guarantee the attacker will hand over the decryption key. In that case, you can just start to rack up the fees to get back to square one.

Loss of Data and Productivity:

Data loss can completely cripple your business. So much so that it’s found that less than half of ransomware victims are able to fully recover their data after a ransomware attack. Many times, business struggle to stay open after they experience data loss. Imagine losing sensitive and mission critical company records or client information. This can significantly impact your bottom line and brand reputation. Even if you did pay the ransom, there’s a chance that your files may be corrupted.

Sometimes when a ransomware attack strikes, you must shut down your systems, putting your business to a halt. This can cause severe damage to your productivity because your employees might not have access to information needed to complete their everyday duties. At the minimum you could miss deadlines, but in the worst case this will cause you to lose sales and revenue.

Downtime Costs:

When you get hit with a ransomware attack, whether you pay the ransom or not, you are going to experience some kind of downtime. In most cases, the downtime costs are likely to be way more hazardous to your bottom line than the ransom payment. While paying the ransom is still not recommended, downtime can lead to financial loss, reduced customer satisfaction and even damage to your reputation. Downtime, on average, can cost organizations billions of dollars yearly, so we do not want you to suffer from this hit, even if it’s just for a few hours.

Reputation Effects:

Unfortunately, reputational effects are bound to happen when you experience a ransomware attack or any kind of data loss. In the worst situations, you may need to notify customers and legal parties about the situation. When it comes to these situations, what matters the most is how quickly and efficiently you are able to get back up and running and back to building that brand up.

 
Related: How To Survive The Data Apocalypse
 

When a ransomware attack happens to you, it is best to consult in your IT managed services provider before making any decisions. They will be able to guide you with the best decisions for your organization. To avoid downtime, and associated costs, implement a solid data backup and disaster recovery solution. The capabilities that let you roll back to your backup files can allow for true business continuity.

NetServe365 can also help you with Managed IT security services that can keep an eye on the integrity of your systems and prevent attacks from spreading. Our services are backed by a team of certified security experts that work behind the scenes, as an extension of your team, detecting, remediating, and minimizing threats and vulnerabilities. Contact us today for more information!

 
 

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