The cyber attack that hit TalkTalk last October continues to have repercussions for the telecoms giant.
According to its interim results for the six months to 30 September 2015, released on 11 November, TalkTalk estimated the one-off financial impact of the cyber attack to be £30-35 million. Now, some two and a half months on, TalkTalk has revised those figures.
It now estimates in its Q3 trading update that the attack could cost it more than £60 million, with £40-45 million in “exceptional costs” – largely the result of unconditional free upgrades for customers – and £15 million in reduced trading revenue.
Customer churn was heavy, too: 4% of TalkTalk’s customers – 156,959 account holders – were affected by the incident in some way, of whom 15,656 had bank sort codes and account numbers accessed. Now, it emerges that up to 101,000 customers left TalkTalk following the cyber attack.
Investors clearly believe that TalkTalk is recovering well from a major incident, though – its share price rose 5% to 228.8p in the first minutes of trading yesterday morning according to City AM. The Financial Times points out, however, that TalkTalk shares have dropped more than 30% since the cyber attack was first revealed. Recovery is slow.
Dido Harding, TalkTalk’s CEO, said yesterday:
“It is encouraging to see the business returning to normal after a challenging quarter that was dominated by the cyber attack.”
Cost of cyber crime
The TalkTalk incident – and a rise in estimated costs from £30 million in November to £60 million the following February – demonstrates how difficult it is to estimate the cost of cyber crime. One thing is for sure, though: cyber crime is expensive. And it’s becoming the norm for businesses of all sizes and sectors.
If you’re concerned about your organisation’s susceptibility to cyber crime and online attacks, you’ll be interested in IT Governance’s penetration testing packages. Designed to identify vulnerabilities and provide remedial measures that you can take to secure your systems, they provide a complete solution for the routine security testing of your websites and IT systems to ensure that your networks and applications remain secure against cyber attacks.
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