Ransomware has become one of the most dangerous and pervasive forms of malware in the world. Unfortunately, there are still a lot of individuals and businesses that fail to properly protect themselves from this threat. To understand why that is so crucial, you need to understand the true costs of a ransomware attack. So, let’s take an evidence-based look at the facts and try to get our heads around the scope of the problem.
Annual Costs Of Ransomware Attacks
Let’s start by looking at some annual statistics on ransomware costs in general. According to these statistics cited by Forbes, ransomware attacks cost American businesses about 6.9 billion dollars in 2021. That alone is cause enough for concern.
Globally, ransomware costs in 2021 were roughly 20 billion dollars. That number is expected to become about $265 billion by 2031. Broken down on an individual basis, that amounts to an average recovery cost of 1.85 million dollars per business affected. These same statistics also tell us that about 37% of all businesses had been attacked by ransomware at some point during the year.
Breaking Down The Cost Of A Ransomware Attack
So, what makes a ransomware attack so expensive? Well, first of all, we should tell you that it doesn’t necessarily have to be all that expensive. If you take adequate measures to prepare yourself, a ransomware attack can be dealt with efficiently. Of course, you will certainly lose some revenue during downtime while repairs are underway, but the effects can be minimized.
The main thing is to make sure you always back up your crucial data on a regular basis. Multiple times per day is the safest option, but once per day is sufficient to avoid major losses. So, let’s consider the costs in a best-case scenario and a worst-case scenario.
You are adequately prepared for a ransomware attack, but somehow the malware manages to infect your network/devices. If you disconnect the network at the source before the malware has finished encrypting the drive, it might be possible for your IT operatives to decrypt the drive. If not, you will have to wipe everything and restore from the most recent backup. This is where a cloud backup becomes very handy because you can get on the internet without accessing the compromised network.
So, it is definitely going to take some time for your IT people to effect repairs. They will have to wipe and restore every device, as well as the network hardware (routers, etc). All passwords will have to be changed, and the source of the breach will need to be investigated. While all this happens, your business will not be able to use the network for business, so you’ll definitely experience losses in terms of lost revenue. There will also be some labor costs involved since your IT team will be doing a lot more than usual. However, if you have the right people on the job, they might be able to fix the problem in a day or two.
There is still one problem, though: Your confidential data may have fallen into the hands of criminals. This data could be used to extort you a second time. As such, you will still need to notify the public and law enforcement. This kind of thing isn’t great for a company’s reputation, but the damage tends to be minor as long as you are honest. As soon as you try to conceal a breach, the potential fallout from the public goes up immensely.
In this scenario, you were not prepared for a ransomware attack at all. That means you didn’t take the time to educate your employees about the dangers of phishing, and that you didn’t back up your data properly. In a situation like this, the attackers have you in a very compromising position. This is the kind of situation in which many companies would be tempted to pay the ransom and keep quiet.
No matter how tempting this may be, it will only make things worse. There is no guarantee that the attackers will return your access or your data. Criminals like these aren’t usually known for keeping their word. So, you are definitely looking at some serious losses here. You will have to wipe your devices and change all your information, but without a backup, everything will have to be rebuilt from scratch. This will certainly be expensive in terms of labor and downtime. You can expect to be down for three weeks or more.
Worse, the loss of all that crucial data can cause you a lot of problems when it comes to compliance and accounting. That is why you need to make sure your IT people document the system logs before wiping anything. That way, the data can be used as proof of the attack. Otherwise, you could find yourself having to do some fast talking with federal regulators, and that rarely ends well. This guide should help you to respond appropriately so that you don’t make the situation any worse.
Downtime Is The Most Expensive Part
Most sources seem to agree that downtime is the most expensive aspect of ransomware recovery. These losses can be especially severe for large companies that conduct a lot of business online. During this time, companies are bringing in little to no revenue, but they still have to pay most of the usual operating costs. That fact alone explains why ransomware downtime cost companies about 159.4 million dollars in 2021.
Ransomware can be ridiculously expensive, and a lot of those expenses do not come from the ransom itself. You should never pay the ransom, and so that usually isn’t figured into the cost estimates. Paying the ransom is more than a gamble: It’s like playing a game that you already know to be rigged. If you would like to learn more about this subject, or if you need co-managed IT for NJ and PA, we recommend that you call PCH Technologies at (856) 754-7500.