Technology company Hewlett Packard (HP) has unveiled research indicating that the cost and frequency of cyber crime have both continued to rise for the third straight year.

According to the third annual study of US companies, the occurrence of cyber attacks has more than doubled over a three-year period, while the financial impact has increased by nearly 40%, says HP.

Conducted by the Ponemon Institute and sponsored by HP, the 2012 Cost of Cyber Crime Study found that the average annualised cost of cybercrime incurred by a benchmark sample of US organisations was $8.9 million.

This represents a 6% increase over the average cost reported in 2011, and a 38% increase over 2010. The 2012 study also revealed a 42% increase in the number of cyber attacks, with organisations experiencing an average of 102 successful attacks per week, compared to 72 attacks per week in 2011 and 50 attacks per week in 2010.

“Organisations are spending increasing amounts of time, money and energy responding to cyber attacks at levels that will soon become unsustainable,” said Cassie Liddle, solution pre-sales architect, South Africa and MEMA, HP.

“There is clear evidence to show that the deployment of advanced security intelligence solutions helps to substantially reduce the cost, frequency and impact of these attacks,” added Liddle.

The most costly cyber crimes continue to be those caused by malicious code, denial of service, stolen or hijacked devices, and malevolent insiders. When combined, these account for more than 78% of annual cybercrime costs per organisation.

“The purpose of this benchmark research is to quantify the economic impact of cyber attacks and observe cost trends over time,” said Dr. Larry Ponemon, chairman and founder, Ponemon Institute. “We believe a better understanding of the cost of cyber crime will assist organisations in determining the appropriate amount of investment and resources needed to prevent or mitigate the devastating consequences of an attack.”

In conjunction with this third annual study of US companies, cyber crime cost studies also were conducted in Australia, Germany, Japan and the United Kingdom by HP.

Additional key findings include:

• Information theft and business disruption continue to represent the highest external costs. On an annual basis, information theft accounts for 44% of total external costs, up 4% from 2011. Disruption to business or lost productivity accounted for 30% of external costs, up 1% from 2011.
• Deploying advanced security intelligence solutions can mitigate the impact of cyber attacks. Organisations that deployed security information and event management (SIEM) solutions realised a cost savings of nearly $1.6 million per year. As a result, these organisations experienced a substantially lower cost of recovery, detection and containment than organisations that had not deployed SIEM solutions.
• Cyber attacks can be costly if not resolved quickly. The average time to resolve a cyberattack is 24 days, but it can take up to 50 days according to this year’s study. The average cost incurred during this 24-day period was $591,780, representing a 42% increase over last year’s estimated average cost of $415,748 during an 18-day average resolution period.
• Recovery and detection remain the most costly internal activities associated with cyber crime. On an annual basis, these activities account for almost half of the total internal cost, with operating expenses and labor representing the majority of the total.