The average cost of cybercrime escalates to $15 million per organization

A new study by the the Ponemon Institute and HP reveales a dramatic increase in the overall cost of cyber crime. The 2015 Cost of Cyber Crime Study quantifies the annual cost of cyber crime for companies across seven countries including the U.S., U.K., Japan, Germany, Australia, Brazil and the Russian Federation.


In the U.S. study, researchers found the average annualized cost of cyber crime incurred by a benchmark sample of U.S. organizations was $15 million, representing a nearly 20 percent increase year over year and an 82 percent increase since the study’s inception six years ago.

The results also revealed the average time it takes to resolve a cyber attack – 46 days – has increased by nearly 30 percent during this same six-year period, with the average cost incurred to resolve a single attack totaling more than $1.9 million.

The U.S. study also revealed that some organizations are addressing the significant costs associated with detection and recovery by making investments in security intelligence, which has been shown to reduce response costs and provide a significant return on investment.

“As organizations increasingly invest in new technologies like mobile, cloud, and the Internet of Things, the attack surface for more sophisticated adversaries continues to expand,” said Sue Barsamian, senior vice president and general manager, Enterprise Security Products, HP. “To address this challenging dynamic, we must first understand the threats that pose the most risk and then prioritize the security strategies that can make a difference in minimizing the impact.”

As organizations strive to embrace new technologies while protecting their expanded environments, there is a need to shift security strategies from traditional network control and perimeter management to an advanced focus on protecting interactions among users, applications and data. The study demonstrates this shift; reporting organizations are now committing 20 percent of their security budgets to the application layer1, up 33 percent in just two years.


Key findings:

Cyber crimes continue to be very costly: The average annualized cost of cyber crime incurred was $15 million, with a range from $1.9 million to $65 million each year per company. The net increase in the cost of cyber crime over the six year span of the study was 82 percent.

Cyber crime costs vary by organizational size: Results revealed a positive relationship between organizational size (as measured by enterprise seats) and annualized cost. However, based on enterprise seats, results showed that small organizations incurred a significantly higher per capita cost than larger organizations.

Cost to resolve cyber attack escalates: The average time to resolve a cyber attack was 46 days, with an average cost to participating organizations of more than $1.9 million during this 46-day period. This represents a 22 percent increase from last year’s estimated average cost of approximately $1.5 million, which was based upon a similar 45-day resolution period.

Understanding the cyber threats that pose the biggest risk and have the most economic impact to organizations can help enterprises better plan their security approach and investments.

  • The most costly cyber crimes are caused by denial of service, malicious insiders and malicious code. These accounted for more than 50 percent of all cyber crime costs per organization on an annual basis. Results also showed that malicious insider attacks can take longer to address, with an average of approximately 63 days to contain.
  • Information theft represented the highest external cost, followed by the costs associated with business disruption. On an annual basis, information theft accounted for 42 percent of total external costs, while costs associated with disruption to business or lost productivity accounted for 36 percent of external costs (up 4 percent from the six-year average).
  • Recovery and detection were the most costly internal activities, accounting for 55 percent of the total annual internal activity cost, with cash outlays and direct labor representing the majority of these costs.

Organizations investing in and using security intelligence technologies and governance practices to address the crimes that proved most costly were more efficient in detecting and containing cyber attacks, thereby reducing costs otherwise incurred.

  • Deploying a SIEM solution led to an average cost savings of $3.7 million per year, compared to companies not deploying similar security solutions.
  • A sufficient budget can save an average of $2.8 million in attack response and management costs.
  • Employment of certified/expert security personnel can save $2.1 million.
  • The appointment of a high-level security leader can reduce costs by $2 million.
  • The percentage of participating organizations realizing cost savings from the full deployment of enabling security technologies to guard against adverse data loss included: encryption technologies at 57 percent, access governance tools at 45 percent, data loss prevention tools at 38 percent and policy management tools at 36 percent.