Data loss prevention solutions prevent sensitive data from seeping through cracks in network security.
IT security systems are designed to prevent malicious outside forces from invading the network. However, these systems generally do little to keep data inside the network. After all, employees, contractors, suppliers, partners and even customers need ready access to data in order to keep the organization running smoothly. Preventing that access would cause operations to grind to a halt.
The loss of sensitive data can be extremely costly, however. For its fifth annual U.S. Cost of a Data Breach Study, the Ponemon Institute tracked a wide range of cost factors, including outlays for detection, escalation, notification and response, legal, investigative and administrative expenses, and costs associated with customer support such as information hotlines and credit monitoring subscriptions. The study also analyzed opportunity costs and the economic impact of lost or diminished customer trust and confidence, measured by customer churn or turnover rates.
The research firm found that data breach incidents cost U.S. companies $204 per compromised customer record in 2009, compared to $202 in 2008. Average total per-incident costs in 2009 were $6.75 million, compared to an average per-incident cost of $6.65 million in 2008, despite an overall drop in the number of reported breaches.
Just how prevalent are data breach incidents? The Third Annual Electronically Stored Information (ESI) Trends Report, an independent study commissioned by Kroll Ontrack, found that the average organization claims to experience two data breaches every year. However, only 33 percent of U.S. organizations feel able to respond very effectively to a data breach.
Comprehensive data loss prevention (DLP) solutions can reduce the number of data loss or exposure incidents and protect business processes that are fueled by mission-critical data. DLP solutions help companies discover, monitor and manage sensitive data in flight across corporate networks, at rest in back-end systems, backups and archives, or in use on servers, desktops and laptops. DLP solutions also help organizations comply with government and industry regulations regarding data security, and ensure that all users adhere to the established internal policies regarding data protection.
Few organizations know where all of their sensitive data resides on the network, and that lack of visibility is a contributing factor in many data loss incidents. As a result, the first step in preventing data loss is to identify data that needs protection — including both corporate secrets such as financial data and trade secrets and custodial data such as customer and payment card information. Comprehensive DLP solutions include discovery components that identify sensitive data in file servers, databases and e-mail repositories, as well as endpoints such as desktops, laptops and removable storage. Once sensitive data is identified, the DLP solution serves as a centralized platform for setting, managing and enforcing policies governing the protection of that data.
Discovery and policy management functions combine to automatically protect data as it travels across the network and beyond. DLP solutions can also prevent unauthorized users from downloading or copying data onto an endpoint, and inspect communications to ensure that confidential data is not transmitted via e-mail, instant messaging or social networking sites.
Notification mechanisms alert organizations of security lapses so that sensitive data may be transferred to a more secure location. Reporting and analytics tools aid in regulatory compliance and in targeting employee training and awareness programs. These strategies pay off — the Ponemon study found that negligent insider breaches have decreased in number and cost, most likely because of the positive effect training and awareness programs have on employees’ sensitivity to the protection of personal information.
At the same time, other types of risks have increased the overall cost of data loss. According to the Ponemon study, data breaches by third-party organizations such as suppliers and partners remain the most costly due to additional investigation and consulting fees. Data breaches resulting from malicious attacks and botnets are also costly and severe. Furthermore, organizations are spending more on legal defense costs, which the Ponemon Institute attributes to increasing fears of successful class actions stemming from the loss of customer, consumer or employee data.
The most expensive data breach event included in this year’s study cost the organization nearly $31 million to resolve, while the least expensive data breach incident cost $750,000 to resolve. These costs, coupled with the challenges associated with protecting enterprise data, are fueling strong demand for DLP solutions. The Radicati Group estimates that the total market for DLP and related e-discovery solutions will top $2 billion by 2013, reflecting the need for comprehensive, technology-based data protection for sensitive data throughout the enterprise. More and more organizations are recognizing that traditional network security systems are not sufficient to prevent data leaks.
“In the five years we have conducted this study, we have continued to see an increase in the cost to businesses for suffering a data breach,” said Dr. Larry Ponemon, chairman and founder of the Ponemon Institute. “With a variety of threat vectors to contend with, companies must proactively implement policies and technologies that mitigate the risk of facing a costly breach.”
