McAfee has announced that it has sponsored a first-of-its-kind report quantifying the economic impact of cybercrime. After years of guesswork and innumerable attempts to quantify the costly effects of cybercrime on the US and world economies, McAfee engaged one of the world’s pre-eminent international policy institutions for defence and security, the Centre for Strategic and International Studies (CSIS), to build an economic model and methodology to accurately estimate these losses, which can be extended worldwide. Estimating the cost of cybercrime and cyber espionage posits a $100 billion annual loss to the US economy and as many as 508 000 US jobs lost as a result of malicious cyber activity.
To help measure the real loss from cyber attacks, CSIS enlisted economists, intellectual property experts and security researchers to develop the report. The researchers estimate the range for cybercrime loss to the global economy is between $100 billion and $500 billion.
The cost of malicious cyber activity involves more than the loss of financial assets or intellectual property. There are opportunity costs, damage to brand and reputation, consumer losses from fraud, the opportunity costs of service disruptions, cleaning up after cyber incidents and the cost of increased spending on cyber security. Each of these categories must be approached carefully, but in combination, they help us gauge the cost to societies.
“This report also connects malicious cyber activity with job loss,” said James Lewis, director and senior fellow, Technology and Public Policy Program at CSIS, and a co-author of the report. “Using figures from the Commerce Department on the ratio of exports to US jobs, we arrived at a high-end estimate of 508 000 US jobs potentially lost from cyber espionage. As with other estimates in the report, however, the raw numbers might tell just part of the story. The effect of the net loss of jobs could be small, but if a good portion of these jobs were high-end manufacturing jobs that moved overseas because of intellectual property losses, the effect could be wide ranging.”
To view a copy of the full report go to http://www.mcafee.com/us/resources/reports/rp-economic-impact-cybercrime.pdf
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