Economic Damage from Digital Risk Stabilising
release & faq in pdf
London, UK - 22 October 2002, 17:00 GMT - The estimate for the total
economic damage arising from overt digital attacks has changed little in 2002
despite a doubling in the number of attacks year on year. This demonstrates
a remarkable decline in the quality of targets chosen for digital attack.
The projected estimate for overt digital attacks worldwide is $7 Billion for
2002 compared to $7.7 Billion for 2001. This stands in contrast to the projected
65,000 overt attacks for 2002 compared to 31,322 for 2001.
The principal targets for overt digital attacks in 2002 have been the US,
Germany and UK amounting to half of all attacks across the world. October
has been another record-breaking month for overt digital attacks with 11,730
attacks so far. The last quarter saw damage estimated at $2.5 Billion from
overt digital attacks and October has already seen $700 Million worth of economic
Economic damage through viruses, worms and hoaxes has been the worst in October
for 2002 contributed in part by Bugbear, which alone caused in excess of $950
Million damage worldwide. The number of new viruses being discovered, however,
is falling: 265 new viruses and worms have been discovered in 2002 in comparison
to 273 in 2001 and 422 in 2000. The last quarter saw an estimated damage of
$3.8 Billion from viruses and worms such as Klez, Yaha and Sircam.
When overt attacks, both recorded and unrecorded, are taken together with
covert attacks, viruses and worms, the cumulative economic damage worldwide
stands at between $32 and $39 Billion for 2002 so far. Although 2001 and 2002
have suffered similar economic damages and appear to be stabilising, previous
years have shown exponential growth.
New vulnerabilities announced by software vendors in 2002 so far are 1,129
of which a record 276 were announced in October alone. Vulnerabilities pertain
to the operating system, server software and third party applications and
have a cumulative impact on digital attacks, for example, where blends of
new and old vulnerabilities are exploited simultaneously. By comparison, there
were 1,506 vulnerabilities announced in 2001, 990 in 2000, 861 in 1999 and
just 245 in 1998.
"The proliferation of automatic digital
attack tools and malicious code-writing kits on the internet coupled with
the growth in software vulnerabilities has enabled larger numbers of computer
systems to be compromised in a single attack," said DK
Matai, Chairman and CEO of mi2g. "This
has meant that whilst the volume of security breaches in 2002 has risen significantly
the quality of the targets selected and the consequent economic damage done
has been more diffuse."
Notes to Editors
What is EVEDA?
EVEDA stands for Economic Value Engine for Damage Analysis. EVEDA is a component
of the SIPS (Security Intelligence Products & Systems) database, which
estimates economic damage as loss of productivity, management time, Intellectual
Property Rights (IPR) violations, customer and supplier liabilities and share
price decline where applicable. EVEDA collects its information from a variety
of open sources and measures the economic value associated with a particular
brand or publicly listed company based on a unique set of algorithms developed
by the mi2g SIPS team in conjunction with risk analysts.
Over the last six years, the worldwide economic damage estimate for all forms
of digital attack has been estimated via EVEDA at between: $35 and $43 Billion
(2001); $22 and $27 Billion (2000); $18 and $22 Billion (1999); $3.6 and $4.4
Billion (1998); $2.9 and $3.7 Billion (1997); $800 and $970 Million (1996).
What is an "overt digital attack"?
Hacker attacks on digital systems, such as computers and digitally controlled
machines, can be either covert or overt. Covert attacks are not reported,
validated or witnessed by a reliable third party source, whereas overt attacks
are either public knowledge or known to an entity other than the attacker(s)
and the victim(s).
mi2g defines an overt digital attack as being an incident when a hacker
group has gained unauthorized access to an online system and has made modifications
to any of its publicly visible components (such as a broadcast, service routine,
payment / data collection or print out) whilst executing:
1. Data Attacks: The confidentiality, integrity, authentication or non-repudiation
of transactions based on the underlying databases is violated. Such attacked
databases may include confidential credit card numbers, identity information,
customer and supplier profiles and transaction histories;
2. Command and Control Attacks: SNMP (Simple Network Management Protocol)
controlled computers, routers and switches, networks of ATMs (Automated Teller
Machines), DCS (Distributed Control Systems), SCADA (Supervisory Control And
Data Acquisition) systems or PLCs (Programmable Logic Controllers) have been
What are the motives for "overt digital attacks"?
The principal motives for digital attacks have been political tension, protest
and digital warfare; espionage, surveillance and reconnaissance; destruction
of competitive advantage or share price; disgruntled or misdirected workforce
issues; anti-globalisation and anti-capitalism protest; environmental and
animal rights activism; intellectual challenge and recreational hacking; financial
mi2g has been collecting data on overt digital attacks going back
to 1995 via the SIPS (Security Intelligence Products and Systems) database.
The SIPS database has information on over 97,000 overt digital attacks and
6,100 hacker groups. The SIPS intelligence citations include the 2002 Computer
Security Institute (CSI) / Federal Bureau of Investigation (FBI) Computer
Security Issues and Trends Survey [Vol. VIII, No. 1 - Spring 2002]. Detailed
copies of the SIPS reports for each month, including back issues can be ordered
from the email@example.com.
A vetting process may be carried out prior to the release of the SIPS reports
to individuals and for overseas orders. mi2g solutions engineering
pays particular regard to security. mi2g advises on the management
of Digital Risk and incorporates Bespoke Security Architecture in its SMART
sourcing solutions. mi2g has pioneered the Contingency Capability Radar
to assist in rigorous business continuity planning based on ISO 17799.
First contact: Tel: +44 (0) 20 7924 3010 Fax:
+44 (0) 20 7924 3310 eMail: Intelligence