The ‘significant and sustained’ cyber attack suffered by telecoms group Talk Talk in October 2015 has had a serious affect on the company’s finances in another warning to businesses of the importance of protecting data.
Assessments by Talk Talk suggest that around 100,000 customers have been lost because of the attack, with exceptional costs of between £40-45m. In a further blow, the disruption to its business caused by closing down its online operations in the wake of the attack was estimated to be £15m. The attack, in which the credit card and bank details of up to 4m customers was stolen, led the company to admit that they were unsure whether the personal data that they held was encrypted.
Whilst the company remains upbeat about its prospects, a recent YouGov survey commissioned by the ICO found that 80% of customers would be wary about doing business with a company that had been involved in a high-profile data security breach. The results underline the importance consumers place on strict data protection standards and make clear that while loss can be accounted for, reputational damage is perhaps less easy to quantify and manage.
As ever, businesses should understand the risks that they face and the legislation under which they are required to operate. Ensuring high standards by making thorough risk assessments, educating employees and investing in IT may incur cost in the short term, but will ensure that your company is not making headlines for all the wrong reasons in 2016.