Cost of Data Breaches: Lost Laptops Cost $50,000 Per Incident.

According to Intel and the Ponemon Institute, the true cost of a stolen laptop is closer to $50,000 than it is to $5,000, the (admittedly overpriced) value for replacing the machine.  The ten-fold difference is attributed to the missing data and associated activities, and underscores the importance of data security products like hard disk encryption from AlertBoot endpoint security solutions.

Ponemon Study Details

A copy of the whitepaper can be found here (direct link to PDF download).

  • 138 lost or stolen laptops over a 12-month period studied

  • 29 organizations involved, including government agencies

  • 80% of the $50,000 figure is attributed to the data ($39,000)

  • Lost intellectual property accounts for $5,000

  • Replacement of equipment, productivity loss, investigations account for the remaining $5,000

As the San Jose Mercury News notes, the FBI placed the value of a lost laptop at $89,000, when a study was conducted several years ago.

Also of note: the study found that the true cost of the lost laptop depends on quickly a company realizes a laptop is lost: if the breach is noticed on the same day, the average cost is nearly $9,000.  Wait a week or longer, and the average cost has ballooned to a little over $115,000.

And of even more particular note:

“encryption on average can reduce the cost of a lost laptop by more than $20,000.”

Who Owns It?

Another factor that has a bearing on the actual cost of the lost laptop?  Who owns it, which is not a surprise.  A director’s or manager’s laptop costs over $60,000, while a senior executive’s lost laptop would cost a company almost $30,000.  Apparently, the lower you are on the totem pole, the greater the consequences of a breach.

Who’s Most At Risk?

  • Consulting firms

  • Law firms

  • Firms in the financial industry

  • Healthcare organizations

  • Big pharma

  • Technology firms

  • Educational firms

In other words, any companies with significant client lists and significant revenue.  Makes sense.  The more people you serve, the more letters you have to mail out (a simplistic way of viewing things, but I’d say the law of big numbers is only too relevant in such instances). seems to have hit up Dr. Ponemon for an interview regarding the findings.  Pretty good read, if you’d like some additional information not covered in the Intel whitepaper above.

Make sure you read the second page of the article, where issues regarding backups is briefly discussed.

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