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What Makes Ransomware a Successful Business Is… Other Businesses

Ransomware continuously made the headlines throughout 2016. And as the end of the year is approaching, security researchers are gathering statistics and drawing conclusions. Mistakes involving ransomware shouldn’t be repeated, especially on behalf of businesses where losses usually skyrocket.

Related: 2016 Trends in Ransomware

The Award for Most Successful Business Model Goes to Ransomware

70 percent of businesses that have been through a ransomware infection decided to proceed with paying the demanded amount, whereas over 50 percent of users wouldn’t pay. This is what a new survey by IBM Security reveals.

Ransomware is definitely one of the most successful business models of the year, making a reported $209 million only in the first quarter. The number is perhaps getting closer to a billion as we speak. There is no evidence to suggest that the growing ransomware trend would cease to advance. 2016 ransomware definitely took lessons from missteps (such as inadequate encryption) in operations gone wrong.

Furthermore, ransomware represents approximately 40 percent of all spam e-mails in 2016. This has led to a steady uptick in ransomware infections and has shown that individuals and companies systematically fail to prevent the attacks.

The Bothersome Trend of Businesses Paying Ransom

2016 “gave birth” to three of the most feared ransomware families – Cerber, Locky and CryptXXX, as well as 44,287 new ransomware modifications. Cerber and Locky were first released in the wild in the early spring. The distribution mainly relied on spam and exploit kits. CryptoWall, CTB-Locker and Shade continued to plague individuals and corporations, too. According to security reports, Locky alone was spread in 114 countries.

Related: In 2016, Users Were Infected with Ransomware Every 10 Seconds

The year has also demonstrated quite a success of ransomware attacks among businesses. According to the IBM survey, one in two business executives surveyed had a close encounter with ransomware. As a result, 70 percent of them reported that their companies paid the ransom. Half of the companies ended up paying over $10,000 and 20 percent – over $40,000.

Moreover, 60 percent of business executives that participated in the survey said they would be willing to pay for the decryption key to restore data. As for the data, execs are mostly willing to pay for the following:

  • Financial records;
  • Customer records;
  • Intellectual property;
  • Business plans.

In a nutshell, 25 percent of execs share that they would pay between $20,000 and $50,000. No wonder ransomware operators are becoming millionaires so easily.

As for small businesses, only 29 percent of surveyed companies said they experienced a ransomware infection, as opposed to 57 percent of attacks on medium size companies. Only 30 percent of small companies had any security training, whereas 58 percent of larger companies had invested in such.

Related: How to Recognize Spam Emails with Ransomware

Parents Too Very Likely to Pay

Interestingly, in attacks on individuals most successful were the ones against parents. 39 percent of parents surveyed by IBM know about ransomware from first-hand experience. Researchers also discovered that parents are more motivated to pay due to sentimental value of family photos and videos that became victims to ransomware encryption. 55 percent of parents would pay the ransom as opposed to 39 percent of non-parents.

The digitization of memories, financial information and trade secrets require a renewed vigilance to protect it from extortion schemes like ransomware. Cybercriminals are taking advantage of our reliance on devices and digital data creating pressure points that test our willingness to lose precious memories or financial security, said Limor Kessem, Executive Security Advisor, IBM Security and the author of the report.

Milena Dimitrova

An inspired writer and content manager who has been with SensorsTechForum since the project started. A professional with 10+ years of experience in creating engaging content. Focused on user privacy and malware development, she strongly believes in a world where cybersecurity plays a central role. If common sense makes no sense, she will be there to take notes. Those notes may later turn into articles! Follow Milena @Milenyim

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