CSIS Report - cost of Cyber Crime affecting economies & costing jobs
The global cost of Cyber Crime is estimated by the Center for Strategic and International Studies to be up to $575bn in it’s report entitled “Net Losses:Estimating the Global Cost of Cybercrime”, sponsored by McAfee.
The report tries to assess the impact on the global economy by looking at the range of costs and losses associated with Cyber Crime a create an approximate total.
The report highlights four findings:
- The cost of cybercrime will continue to increase as more business functions move online and as more companies and consumers around the world connect to the Internet.
- Losses from the theft of intellectual property will increase as acquiring countries improve their ability to make use of it to manufacture competing goods.
- Cybercrime is a tax on innovation and slows the pace of global innovation by reducing the rate of return to innovators and investors.
- Governments need to begin serious, systematic effort to collect and publish data on cybercrime to help countries and companies make better choices about risk and policy.
The study estimates that hundreds of million individual records in 2013 and that this could be generating as much of $160bn in additional costs and losses. The scale of the problem is potentially huge and, if correct, undermines the economic contribution of the Internet (estimated as being between $2-3trillion) and costs hundreds of thousands, even millions of job
s around the world. The data when correlated to economic data claims an impact on average GDP was 0.5%. In Europe this could translate to 150,000 jobs and in the US 200,000.
The scale of the claimed effected places the effects of Cyber Crime alongside Counterfeiting and Piracy, Narcotics and car crashes.
The report acknowledges the difficulties of calculating a dollar value on the impact of Cyber Crime and approaches the issue by looking at both direct and indirect costs and the assessment includes:
- the loss of intellectual property,
- the theft of financial assets and sensitive business information,
- opportunity costs,
- additional costs for securing networks,
- the cost of recovering from cyber attacks
- And the reputational damage to the hacked company
CSIS are candid that their estimates are based on incomplete data and this leads to more variation than usual. This is principally due to the problem of so many cyber crimes being unreported and few countries having made serious efforts to quantify the impact within their jurisdictions. However, by using Meta Research and aggregation techniques information was developed for 51 countries covering around 80% of global revenues.
To read the report please click the link below.
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That is the shocking conclusion from the panel session held at the recent CBI Cyber Security Conference.
The panel session was chaired by Matthew Fell, Policy Director, CBI and included Giles Smith, Deputy Director Cyber Security and Resilence from DCMS and Steven Wares, Head of Cyber Practice, EMEA, Marsh. London, June 2015.