Security Experts:

DDoS Attacks Cost $40,000 Per Hour: Incapsula

A study commissioned by Incapsula shows that, not surprisingly, distributed denial-of-service (DDoS) attacks can have a serious financial impact on many targeted organizations.

The report is based on the responses of system administration, network, developer, security and website operations employees from a total of 270 North American organizations of various sizes (between 250 and over 10,000 employees).

According to Incapsula, 45% of the respondents said their organization suffered a DDoS attack at some point. However, organizations with 500 or more employees are more likely to be hit, the attack costs in their case are higher, and they require more employees to mitigate the cyberattack.

Survey respondents estimated the cost of a successful DDoS attack at $40,000 per hour. A total of 36% of respondents said the per hour cost of a DDoS attack is between $5,000 and $19,999. Others said the cost of an attack per hour is less than $5,000 (15%), between $20,000 and $59,999 (17%), between $60,000 and $99,999 (17%), and over $100,000 (15%).

Considering that 49% of attacks last between 6 and 24 hours, the average cost is estimated at roughly $500,000. However, the security company says some attacks can result in much higher costs.

Organizations that suffered DDoS attacks also had to deal with non-financial consequences, such as loss of customer trust (43%), customer data theft (33%), and loss of intellectual property (19%). Over half of the respondents said they were forced to replace hardware or software following an attack. In some cases, the malicious actors used DDoS to mask other activities — 50% of those who took part in the survey said they had a piece of malware installed or activated.

From a financial standpoint, the IT group is the one that's most impacted, with 35% of respondents naming this operational area. However, the report shows that customer sales, security and risk management, customer service, marketing and PR, and legal departments are also affected.

"We believe that with the costs for attackers decreasing and costs for businesses increasing, DDoS targets have broadened from financial institutions and government sites to any company that depends on its online channels, like online retailers and SaaS vendors," commented Marc Gaffan, CEO of Incapsula. "With ransom requests as low as a few hundred dollars yielding positive returns for attackers, even small technology start-ups are being targeted and taken down."

A survey of 450 companies in North America conducted by Neustar earlier this year revealed that fourteen percent of companies believe a DDoS outage would trigger losses of between $50,000 and $100,000 per hour, while 29 percent said the cost would be $100,000 or more per hour.  

According to Akamai's State of the Internet report for the second quarter of 2014, the overall number of DDoS attacks has declined. However, DDoS is a type of attack in which some threat groups invest significant resources.

For example, some cybercriminals are infecting Linux servers with malware and using them to launch powerful attacks. Others have been amplifying their attacks by crafting large DNS TXT records.

The complete DDoS impact study from Incapsula is available online.

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