The success of digital transformation projects are being stalled by the fear of the impact and rising costs of breaches associated with data on the go. According to new research from Kaspersky Lab, safeguarding data in the cloud is continuing to present new challenges for businesses, with the most expensive cybersecurity incidents over the last 12 months related to cloud environments and data protection. In an effort to enable digital transformation without compromising on security, businesses are now prioritizing IT security spending. In 2018, enterprise companies are allocating up to 26% of their IT budgets to cybersecurity, redefining the strategic role of corporate data protection.
The 2018 state of corporate IT security economics mirrors the shifting impact of cybersecurity on the business bottom-line. With the consequences of data breaches becoming more expensive and destructive, during the last 12 months, businesses faced a disturbing reality: for SMBs, the average cost of a breach reached $120K in 2018, which is 37% higher than in 2017 ($88k). For enterprises, it increased by a third (24%), with the average financial impact of a breach now reaching up to $1.23 million. These increasing costs are a concern for businesses amidst today’s digital transformation wave where cloud infrastructure is continuing to increase in prominence with 45% enterprises and 33% SMBs having either already raised or are planning to grow their use of hybrid cloud in the next 12 months.
With the cost of IT incidents on the rise, businesses are realizing that they have to prioritize cybersecurity spending if digital transformation projects are to run smoothly and securely. This is illustrated by the growth in IT security budgets in 2018, which sees enterprises spending almost a third of their IT budget on cybersecurity. Interestingly, despite traditionally being viewed as the lowest spenders on IT security, VSB raised from $2.4k to $3.9k over the last 12 months.
One of the key reasons behind this additional investment in IT security is the increased complexity of IT infrastructure (as businesses increasingly adopt cloud platforms), along with helping to improve the level of specialist security expertise. The combination of these factors shows how businesses are really feeling the impact of IT security and illustrates the scale of the challenges they are facing, as they battle to stay secure.
Maxim Frolov, Vice President of Global Sales at Kaspersky Lab says, “To support dynamic business changes and increase efficiency, companies are embracing cloud and business mobility. Cybersecurity has become not just a line item in IT bills, but a boardroom issue and a business priority for companies of any size, as evidenced by companies raising their IT security budgets. Businesses expect a strong payoff as the stakes continue to get higher: besides traditional cybersecurity risks, many companies now have to deal with growing regulatory pressures, for example.”