Know the Odds: The Cost of a Data Breach in 2017

Source: Security Intelligence: Larry Ponemon & Wendi Whitmore

We’ve all heard that when it comes to experiencing a data breach, the question is not if it will happen, but when. You may be wondering about the actual odds of it happening to your organization.

Think about it this way: The chances of being struck by lightning this year are 1 in 960,000. When it comes to experiencing a data breach, according to the Ponemon Institute’s “2017 Cost of Data Breach Study: Global Overview,” the odds are as high as 1 in 4. Therefore, organizations must understand the probability of being attacked, how it affects them and, even more importantly, which factors can reduce or increase the impact and cost of a data breach.

Rapid Response Drives Down the Cost of a Data Breach

Sponsored by IBM Security and independently conducted by the Ponemon Institute, the 12th annual “Cost of Data Breach Study” is out. The findings revealed that the average total cost of a data breach is $3.62 million in 2017, a decrease of 10 percent over last year. Additionally, the global average cost per record for this year’s report is $141, which represents a decrease of 11.4 percent over last year.

Despite the reduction in cost, the average size of a data breach increased by 1.8 percent to 24,089 records. The influencers that impact the cost of a data breach are driven by the country and the IT initiatives underway.

The good news is that organizations can take measures to minimize cost and impact. The 2017 “Cost of Data Breach Study” found that having access to an internal or outsourced incident response team has been the top cost-reducing factor for three years running. An incident response team typically accelerates the time frame in which security events can be contained, which is a significant factor in reducing the overall cost of a breach.

The IBM X-Force Incident Response and Intelligence Services (IRIS) team specializes in providing incident response planning, program development, remediation and threat intelligence to clients in over 133 countries. The team has experience responding to and helping to contain many of the largest data breaches in the world.

Five Steps to Accelerate Your Incident Response

Listed below are five additional tips to help accelerate your organization’s response to a breach.

  1. Speed to respond is critical. The more quickly you can identify what’s happened, what the attacker has access to, and how to contain and remove that access, the more successful you will be.
  2. Set up retainers in advance. In the event of a breach, an experienced team of incident response experts can help you quickly identify and contain the attack, and minimize costly delays.
  3. Access the data needed to answer investigative questions. Be prepared to provide responders with logs and tools to help them understand what happened. For example, what did the attackers access and what did they copy or remove from your environment?
  4. Mitigate the attacker’s access quickly. Plan with the IT staff in advance to understand how to be effective and efficient in a crisis. Consider the following:
    1. How to execute an enterprisewide password reset quickly;
    2. How to reset your service accounts; and
    3. How many of your service accounts have domain administrator credentials.
  1. Establish an internal communications plan. If you have to shut down parts of your environment or reset thousands of users’ passwords, your employees will have a lot of questions. This speculation can have critical ramifications, so it’s important to document a plan to ensure that your employees understand what they can and cannot share publicly.

China propels rise of electric ultra high performance cars

Want an insanely fast ride with zero emissions? Startup NIO has the car: An electric two-seater with muscular European lines and a top speed of 195 miles per hour (313 kilometres per hour).

The catch: The EP9 costs nearly $1.5 million. NIO, a Chinese-Western hybrid with bases in Shanghai, London and Silicon Valley, created it to showcase the company’s technology and had no sales plans. But it is taking orders for “bespoke vehicles” after hearing from buyers ready to pay the eye-popping price.

“We are actually pleasantly surprised how much interest we are getting,” said the CEO of NIO’s U.S. unit, Padmasree Warrior, a veteran of Cisco and Motorola.

NIO is part of a wave of fledgling automakers _ all backed at least in part by Chinese investors _ that are propelling the electric vehicle industry’s latest trend: ultra-high-performance cars.

Manufacturers including Detroit Electric, Qiantu Motor, Thunder Power and NEVS aim to compete with Europe, Detroit and Japan by offering top speeds over 150 mph (240 kph) and features including carbon fiber bodies and web-linked navigation and entertainment.

The ventures mix U.S. and European technology with Chinese money and manufacturing, reflecting this country’s rise as a market and investor for an industry where Beijing wants a leading role. Communist leaders see electric vehicles as a way to clear China’s smog-choked cities and as an engine for economic development.

“We really haven’t seen non-Chinese companies get into this super-technology market,” said Chris Robinson, who follows the industry for Lux Research.

NIO’s backers include Chinese tech giant Tencent Holdings, operator of the popular WeChat messaging service; computer maker Lenovo Group, a Singapore government-owned investment fund and U.S.-based IDG Capital, TPG and Hillhouse Capital.

Some brands are following the strategy of Tesla Inc., which debuted with an eye-catching roadster to establish a premium image before launching lower-priced models.

The instant torque and acceleration of electric cars make them natural performance vehicles.

Detroit Electric, a revival of a pioneering U.S. electric car brand founded in 1907, launched a sports car venture this year with a Chinese battery maker and the government of Yixing, west of Shanghai. For a base price of $135,000, the company promises zero to 60 mph (100 kph) in 3.7 seconds and a top speed of 155 mph (250 kph).

The first seven of 100 cars ordered by European dealers have been delivered, according to its chairman and CEO, Albert Lam, a former Lotus chief executive. He said the company aims to release an SUV in 2018 and wants to have a four-vehicle lineup by 2020.

“Our target is to be the first Chinese-based vehicle company to sell worldwide,” said Lam.

Thunder Power, led by Hong Kong entrepreneur Wellen Sham, has a similarly multinational plan for a sport sedan due out in late 2018.

The company is building a factory in southern China and plans a second in Spain. Engineering work is being handled by Italy’s Dallara Automobili, which helped develop Bugatti’s Veyron, the fastest street-legal car with a top speed of 255 mph (408.84 kph).

Thunder Power promises a top speed of 155 mph (245 kph). The company says its competitive edge will be a battery that can go up to 400 miles (650 kilometres) on one charge, or almost double the 200 to 250 miles (320 to 400 kilometres) of current high-end electrics.

Beijing’s backing has helped to make China the biggest electric vehicle market at a time of uncertainty about the scale of support for the industry from Washington and European governments.

Sales in China of plug-in and hybrid vehicles in the first quarter of this year totalled 55,929, versus 44,876 for the United States.

The Cabinet hopes to have 100,000 public charging stations and 800,000 private stations operating by the end of this year. Regulators are pressing manufacturers to speed up development with a proposal to require that electrics account for at least 8 per cent of each brand’s production by next year.

To raise its profile, the electric vehicle industry launched its own racing circuit, dubbed Formula E, in 2014 with battery-powered Formula One-style cars and events in China, Europe, the United States and Mexico.

Still, no matter how appealing they are, there aren’t enough buyers to support so many high-performance brands, said Lux’s Robinson. He noted Ferrari or Lamborghini might sell only 15 of their fastest vehicles, which are treated as marketing tools and even at prices above $1 million fail to make a profit.

Manufacturers wanting to move into lower priced segments face a crowded market, he said.

“Really, not all of them are going to make it,” said Robinson.

Despite that, the newcomers express confidence they can take market share from established rivals.

NIO’s Warrior points to the transition from cellphones to smartphones, in which industry leaders were displaced by upstarts.

“We are in the beginning of a race. We are all at the same starting position,” said Christopher Nicoll, marketing director for Thunder Power.

Detroit Electric’s Lam said his financial plan calls for each car to be sold at a profit by 2019.

“We are not from the internet world,” he said. “We know how important it is for a car company to make money.”

Other Chinese tech companies including internet search engine operator Baidu Inc. and LeEco, an online video service, are working on electric and self-driving vehicles. Most have research centres in Silicon Valley or Europe.

“China isn’t necessarily a technological leader. They are a production leader,” said Robinson. “A lot of the more advanced electric vehicle, power train and other technology research is going on in Europe and the United States.”

Chinese city governments are forging partnerships with automakers in hopes of becoming manufacturing centres.

That helped Detroit Electric carry out its plans after other investors were uncertain, Lam said. He said the company picked Yixing after talking with four cities.

“We were invited to come to China,” said Lam.

The most prominent homegrown competitor is Qiantu Motor, led by a former executive of a state-owned automaker.

Qiantu says its K50, on sale next year, will deliver a top speed of 125 mph (200 kph) and go 185 miles (300 kilometres) on one charge.

NEVS is developing a sedan to be made in China based on technology acquired from defunct Swedish automaker Saab.

Its owners include National Modern Energy Holdings Ltd., a Chinese developer of renewable energy technology, the government of the eastern city of Tianjin and State Research Information Technology Co., owned by the Chinese Cabinet.

NIO developed the EP9 to promote its technology for self-driving vehicles. The first, a seven-seat SUV, is due to be released in China in 2018.

The company worried buyers saw electrics as a “little toy car.” It wants to “break that mould and say that an electric car can be a serious performance car,” said Warrior.

NIO says a self-driving version of the EP9 hit 160 mph (256 kph) in February on an Austin, Texas, test track.

“We made seven, thinking it was essentially for a collector,” said Warrior. “Now there is increased interest. People actually want to buy this car.”

 

Researchers: We’ve discovered power grid wrecking software

Researchers have found a troubling new form of power grid-wrecking software, tying the discovery to a recent Ukrainian blackout in tworeports published Monday.

The malicious software has the ability to remotely sabotage circuit breakers, switches and protection relays, the reports say, a nightmare scenario for those charged with keeping the lights on.

“The potential impact of malware like this is huge,” said Robert Lipovsky, a researcher with Slovakian anti-virus firm ESET, which first obtained the rogue program. “It’s not restricted to Ukraine. The industrial hardware that the malware communicates with is used in critical infrastructure worldwide.”

Policymakers have long worried over programs that can remotely sabotage industrial systems because of their potential to deal catastrophic damage across the internet. Examples of hackers being able to turn off the lights were once confined to the movie screens, but that is slowly changing. In 2010 researchers discovered Stuxnet, a groundbreaking piece of malware apparently designed to sabotage Iran’s nuclear program by sending its centrifuge machines spinning out of control. In 2015, a cyberattack left upward of 200,000 people without power in Ukraine.

ESET’s report deals with malware tied to a more modest outage reported to have hit a transmission facility outside in Kyiv on the night of Dec. 17, 2016. Ukrainian officials have previous described the incident as a cyberattack, but ESET’s report _ along with another write-up by the respected Maryland-based industrial cybersecurity firm Dragos _ add a wealth technical details, showing how the malware could flip circuit breakers on and off with a string of code before mass-deleting data in a bid to cover its tracks.

The level of sophistication needed to write code for the generally obscure industrial controllers that operate the world’s electrical grids suggests a group of hackers well-versed in the field and with the resources to test their creations in the lab, ESET said.

Lipovsky, the researcher, declined to be drawn on who might be behind the malware, although Ukrainian officials have in the past laid the blame for such intrusions on Russia. Ukrainian officials didn’t immediately return a message seeking comment on the report.

For others in the field, the discovery highlighted the often-discussed dangers of connecting poorly defended industrial computers to the internet.

“The vast majority of industrial control system networks around the world are not protected,” said Galina Antova, the co-founder of infrastructure security firm Claroty.

Ordinary hacking can be disruptive enough, but when something like a power grid is involved, “the impact is much, much more significant.”

 

Toyota Motor Corp. is working on a “flying car.”

A startup backed by the Japanese automaker has developed a test model that engineers hope will eventually develop into a tiny car with a driver who’ll be able to light the Olympic torch in the 2020 Tokyo games. For now, however, the project is a concoction of aluminum framing and eight propellers that barely gets off the ground and crashes after several seconds.

Toyota has invested 42.5 million yen ($386,000) in startup Cartivator Resource Management to work on “Sky Drive .” At a test flight June 3, 2017 in the city where the automaker is based, the gadgetry, about the size of a car and loaded with batteries and sensors, blew up a lot of sand and made a lot of noise.

It managed to get up as high as eye level for several seconds before tilting and falling to the ground. Basketballs attached to its bottom served as cushions. After several attempts, the endeavour had to be cancelled after one of the covers got detached from the frame and broke, damaging the propellers.

The goal of Cartivator’s is to deliver a seamless transition from driving to flight, like the world of “Back to the Future,” said the project’s leader Tsubasa Nakamura.

“I always loved planes and cars. And my longtime dream was to have a personal vehicle that can fly and go many places,” he told The Associated Press.

The group is now working on a better design with the money from Toyota with the plan to have the first manned flight in 2019. No one has ridden on Sky Drive yet, or any drone, as that would be too dangerous.

Still, dabbling in businesses other than cars is Toyota’s trademark. In recent years, it has been aggressively venturing into robotics and artificial intelligence, investing a billion dollars in a research and development company in Silicon Valley. It’s also working in Japan on using robotics to help the sick walk. It also just announced a five-year $35 million investment in its research centre in Ann Arbor, Michigan, for autonomous and connected vehicle technologies.

The idea that each generation must take up challenges is part of Toyota’s roots, said auto analyst Takaki Nakanishi.

President Akio Toyoda’s great-grandfather Sakichi Toyoda started out developing the loom and then its automated improvements from the 1890s, before the company became an automaker. More recently, Toyota sees software and services as central to the auto industry, as cars become connected, start driving themselves and turn into lifestyle digital tools, Nakanishi said.

As Toyota gets into the business of ecological vehicles, such as hybrids, electric cars and fuel cells, it’s turning into an energy company as well.

“Toyota’s business is centred on mobility, anything that moves, including people, things, money, information, energy,” said Nakanishi.

Toyota is travelling not only in the skies but also to the waters, although that still remains a tiny part of its sprawling empire.

Toyota’s boat operations began in 1997. Toyota now offers four models and has sold a cumulative 845 boats. In contrast, Toyota sells about 10 million vehicles a year around the world.

Reporters recently got a ride in Tokyo Bay of a Lexus luxury concept “yacht,” which runs on two gas engines. With a streamlined curvaceous design, inspired by a dolphin and evocative of a Lexus car, it’s being promised as a commercial product in the next few years.

Designed for executives zipping through resort waters, it comes with fantasy-evoking features, like an anchor pulled in by a chain into a tiny door in the bow, which opens then closes mechanically.

The engine, shiny like a chrome sculpture, is visible beneath the sheer floor surface. Shigeki Tomoyama, the executive in charge, said the boat was going for “a liberating effect.” A price was not given. Many Americans have already expressed interest, according to Toyota.

The project started about two years ago under direct orders from Toyoda, who has with Tomoyama spearheaded Toyota’s Gazoo internet business, another non-auto business for Toyota.

“He asked us to create a space that can work as a secret hiding place in the middle of the ocean,” Tomoyama said. “We went for the wow factor, which requires no words.”

 

Companion robots featured at Shanghai electronics show

More than 50 companies are showcasing a new generation of robots at this week’s Shanghai CES electronics show, built to serve as companions at home, attendants at shopping malls or just provide entertainment.

Chinese companies including Shenzhen-based startup Aelos Robotic Inc. are displaying robots with heightened dexterity and skills.

Beijing’s Canny Unisrobo Technology Co. Ltd. is a pioneer in the field, with its Canbot, produced in co-operation with Microsoft, having entered mass production almost a decade ago.

Sales manager Zhang Jianting said Thursday that annual sales are about 150,000 units, with the home companion robots selling for $130 to $483 depending on size.

However, Zhang said the robot market is growing ever more crowded, with many more players entering this year alone.

“The robot market in China is increasingly diverse,” Zhang said. “However, there are still some rough edges in R&D and comprehensive abilities. Every company is at initial stage. We are still learning and making progress in terms of technology, R&D, and market.”

Artificial intelligence and virtual reality are also major features of the show, which features 400 exhibitors from 23 regions showing their innovations from June 7 to 9.

For John T. Kelly, the senior director of CES Asia, the participation of more Chinese companies at global electronics shows illustrates how China is shifting from a manufacturing economy to one based on innovation.

“Chinese companies continue to grow more and more in importance. They are creating partnerships with Western partners to really further their technology. So we are seeing development of technology advancing rapidly,” Kelly said.

Among those leading the charge for artificial Intelligence, or AI, is Rokid Corp., maker of the Pebble home companion device that can help seniors perform household chores, provide entertainment and help children learn new skills.

“AI makes our life simpler. AI is replacing human beings in more fields. It saves humans’ labour, so we can do more creative work,” said Li Yuanpeng, the company’s product manager.

 

Autonomous cars (no human backup) may hit the road next year

Autonomous vehicles with no human backup will be put to the test on publicly travelled roads as early as next year in what may be the first attempt at unassisted autonomous piloting.

Automotive electronics and parts maker Delphi and French transport company Transdev plan to use autonomous taxis and a shuttle van to carry passengers on roadways in France.

The companies on Wednesday said they plan to combine Delphi’s self-driving technology with Transdev’s knowledge of mobility operations. Transdev operates trains, buses, ferries and other transportation services in 19 countries, including the U.S.

Two on-demand Renault Zoe autonomous taxis will be deployed in Rouen, Normandy, and a shuttle van will run between a rail station and campus in the university district of Paris-Saclay. Both will start with humans on board later this year, with the intent of going fully autonomous sometime in 2018. From the start, the shuttle van won’t have a steering wheel or pedals, and humans will be inside solely to communicate with passengers, said Leriche, chief performance officer at Transdev Group.

But humans at a central dispatch centre would still be able to take control of the vehicles, said Glen De Vos, Delphi Corp.’s chief technology officer. “We’re confident that in the event they would need to intervene, they can,” he said.

The companies also plan a similar test in North America and are scouting locations, De Vos said.

He believes they’ll go through several iterations of self-driving software and systems before the French vehicles are fully operational sometime in 2019.

Transdev plans to gradually spread the technology throughout Paris and other cities that it serves, so the autonomous vehicles will be on roads along with human drivers.

It may take a while for people to trust the vehicles enough to use them, but Leriche said acceptance may not be that hard to get. Transdev has surveyed users in autonomous shuttle tests about the service and quality, and more than 90 per cent were excited about the service. “They were not afraid of the fact that there was no driver,” he said.

The partnership comes less than a month after U.K.-based Delphi joined with BMW, Intel and Mobileye to develop autonomous vehicles. Delphi, which has U.S. operations just outside of Detroit, makes the computing platform that brings together information from the car’s sensors, cameras and computers.

 

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