Cyberattacks Cost Singapore Firms $17.7b

The economic damage from cyberattacks on companies in Singapore last year amounted to $17.7 billion, with much of that loss caused by the impact on the wider ecosystem and leading to decreased consumer and enterprise spending, a Microsoft study released on Friday said.

The study, conducted by Frost and Sullivan, showed that only about 20% of that damage was caused by the direct impact of a cyberattack on a company’s financials, as a result of things such as fines and remediation costs, CNA reported.

The majority of the loss, or 64%, was because of an “induced loss”. This was defined by the research firm as the impact of a cyber breach on the broader ecosystem and economy.

By comparison, the economic loss from cyberattacks for Asia Pacific as a whole was $1.75 trillion last year, the findings showed.

The breakdown for the region was 10% for direct loss, 30% for indirect loss—referring to opportunity cost such as reputation loss leading to customer churn and job losses—and 60% for induced loss, according to Frost and Sullivan.

Edison Yu, vice president and Asia Pacific head of Enterprise for Frost and Sullivan, said during the presentation of the report that while direct losses from these breaches are most apparent, they are “but the tip of the iceberg”.

As such, its study came up with an economic loss model that looked to include other aspects such as job loss and customer churn due to damage to a company’s reputation.

For a large-sized organization of more than 500 employees in Singapore, Yu said, the economic damage from a cyber security incident was, on average, $13.8 million.