By now, it is common knowledge that cyber attacks can turn out extremely expensive for companies. But one seldom sees concrete figures.
Malware victims hardly ever go public with the amount of damage they have incurred. So it is all the more intriguing that Bloomberg have published an article listing a whole series of concrete examples resulting from the latest malware waves involving WannaCry and NotPetya.
- The NotPetya infection of its systems cost Nivea manufacturer Beiersdorf AG 35 million Euros in turnover over the first six months of the year – not yet calculating for the expense of additional warehousing and production stoppages at 17 production facilities.
- The British company Reckitt Benckiser, which specializes in manufacturing detergent products had to downgrade its expected turnover for the current fiscal year by 90 million British pounds, after it needed to take 2000 servers and 15,000 company notebooks out of operation in June. By July, RB had not yet returned to running at full capacity again.
- French construction materials supplier Cie. de Saint-Gobain announced at the end of July that its malware infection is expected to cost the company 250 million Euros of its previously expected turnover.
Hefty amounts in comparison with the rather modest sum of around 140,000 dollars in Bitcoin, which was paid out as ransom to the Bitcoin wallets of ransomware blackmailers.
Danish shipping giant A.P. Moller-Maersk is still working through the backlog which was built up due to the crash of their online ordering system following a malware infection.
“I don’t think you can model a cyber attack,“ comments Robert Waldschmidt, a London-based analyst at Liberium Capital, which covers Beiersdorff and Reckitt. “Companies can only try their best to prepare defenses. This may mean that IT and consulting costs need to rise a bit to improve these defenses and or implement new ones.“
For instance, Deutsche Bahn has assembled a “Cyber Rapid Deployment Force“ consisting of experienced IT experts. According to a company spokesperson, this force was responsible for ensuring that ticket machines and display screens were back up and running as soon as possible following the WannaCry attack.
It is highly probable, by the way, that the costs caused by WannaCry and NotPetya may actually be much higher for US corporations, such as FedEx, Merck & Co. and Nuance Communications Inc., than for companies based in Europe. However, US companies are generally better insured against cyber attacks – in the light of this, European insurers like Allianz, Zurich or reinsurers such as Munich and Swiss Re are already sensing an opportunity for the future. Lloyds of London estimates the global cyber-insurance market to be somewhere between 3 and 3.5 billion dollars. Munich Re believes that the volume of business could already grow as huge as 8.5 to 10 billion dollars by 2020.
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