June 15, 2017 | News, Press Releases

New Economic Study Highlights Dangers Of Data Breaches & Need For Strong Encryption

BECKERMAN: “Experts across disciplines, parties, and industries all agree: encryption makes America safer and grows the economy.”

 

Washington, DC – Internet Association today released new economic research detailing the integral role of encryption in protecting American interests. The report outlines the increasing risk of data breaches to America’s national security and economic growth, finding that encryption is the only viable solution to mitigating these risks.

“Experts across disciplines, parties, and industries all agree: encryption makes America safer and grows the economy,” said Internet Association President & CEO Michael Beckerman. “This research contributes even more evidence to the consensus that encryption is a necessary part of keeping our country safe. Mandatory security vulnerabilities or encryption back doors do not make us safer.”

IA estimates that nearly 6 billion records could be exposed in data security breaches and these breaches would cause almost $220 billion in damages by 2020 if no changes are made to better protect records.

“Strong encryption is the best – and frankly the only viable – way to protect America’s economic interest from criminals and state-based actors,” said Internet Association Chief Economist Dr. Christopher Hooton. “The economic and infrastructure risks of online security breaches are real and will continue to increase. The internet already represents about 6 percent of GDP and the quantity of both digitized records and internet-connected devices will continue to proliferate, making encryption all the more important.”

Internet Association examined online security breaches, the number of records exposed in breaches, the cost of security breaches, and several other factors in its research. Key findings include:

  • The potential for damaging security breaches is increasing at exponential rates. The average annual costs of privacy breaches from 2005-2016 is estimated to be more than $5.5 billion with large outlier incidents comprising approximately $3.4 billion of that total. These numbers are set to increase.
  • Encryption protects American interests. Experts all across the spectrum agree that encryption makes us, our data, and our nation safer. Engineering vulnerabilities into products and services makes us less safe.
  • Encryption protects the U.S. companies and the government from foreign state-sponsored actors. State-sponsored cybercrime is increasingly a threat, especially from China. Many Chinese industries have turned to hacking as a replacement for research and development, calculating that it’s cheaper to copy American IP from a hack than to develop their own products.
  • Unencrypted data is now a threat to every industry and internet user.  As more and more of our daily lives become integrated into the internet, the risk of a security breach increases both in terms of scope and scale.

To read a two-page summary of the report, click here.

To read the full report, click here.

###

Statement On Senate Passage Of The Music Modernization Act

IA Director, Federal Government Affairs & Counsel Mike Lemon issued the following statement on the passage of the Music Modernization Act in the Senate.

Internet Association Proposes Privacy Principles For A Modern National Regulatory Framework

Washington, DC – Internet Association (IA) today released six principles and policy considerations to modernize national privacy legislation. The internet industry supports an American approach to federal privacy legislation that is consistent nationwide, proportional, flexible, and encourages companies to act as good stewards of the personal information provided to them by individuals. “Internet Association members Read more »

Statement On U.S.-Mexico Announced Preliminary Agreement

Washington, DC — Internet Association Director of Trade and International Policy Jordan Haas issued the following statement in response to the announced U.S.-Mexico two-way trade understanding: “The internet industry is optimistic about the potential of a new NAFTA that will, for the first time, recognize the internet as an important U.S. export that contributes to Read more »

Latest News

IA Director, Federal Government Affairs & Counsel Mike Lemon issued the following statement on the passage of the Music Modernization Act in the Senate.

Read more news »

Stay Updated

Send me IA updates
I'm a member of the press