Viruses and Hackers Costing Businesses Big Bucks

Viruses and computer hackers will cost businesses around the world more than $1.5 trillion in the year 2000, according to study by Information Week Research fielded PricewaterhouseCoopers.

Computer viruses themselves seem to have exploded in the past year, ranging from Melissa to the Love Bug, to Timonfonica, Kak Worm, and Gnutella Worm. The survey of 4,900 IT professionals in 30 nations estimated that approximately 50,000 firms in the US are sufficiently large enough to be impacted by and accurately tally up the cost of a software virus. In total, the bill to these US firms in 2000 for damage caused by viruses and hacking incidents will amount to $266 billion, or more than 2.5 percent of the nation’s Gross Domestic Product (GDP). The price tag worldwide soars to $1.6 trillion.

“The findings indicate that viruses are far more disruptive to organizations than most people realize,” said Rusty Weston, Editor of Information Week Research and informationweek.com. “Lost productivity will undoubtedly force many IT organizations to reassess their network defenses and security policies.”

The $266 billion figure represents the impact on viruses on US businesses with more than 1,000 employees, or about 50,000 firms.

“These are companies with infrastructures of IT professionals who, because of the dollar impact, are increasingly tracking the problem and can provide an accurate assessment of the scope of the issue. In reality, the true impact of viruses on US business, including medium-sized companies and small businesses, is much greater,” said John DiStefano, principal researcher on the study at Reality Research & Consulting, which assisted on the project.

The study found that the key costs involved in correcting IT systems infected by a virus are found in lost productivity as a result of downtime for computer systems, as well as lost sales opportunities. In North America technology professionals this year will suffer system downtime of 3.24 percent, while downtime to 3.28 percent on a worldwide basis. To look at the impact another way, the study found that this year alone 6,882 person years of productivity will be lost in North America and 39,363 will be lost worldwide.

Viruses and the hackers that deploy them were once viewed as clever pranksters, according to the study, but are now seen as real threats.

“Whenever any activity amounts to 2.7 percent of the total US GDP, Wall Street takes notice,” DiStefano said. “Information technology now runs businesses around the globe. Whatever stops the computer systems stops business. So what would have won you fame, and quite possibly a job offer a decade is now a sure ticket to legal action and criminal penalties.”