In 2017, we’ve seen 2 of the highest-profile examples of ransomware cyber-attacks, with the WannaCry and NotPetya incidents in May and June, respectively.
They’re not part of a new phenomenon – computer viruses have existed since the Creeper asked to be caught in 1971. Unlike the benign Creeper however, attacks today are malicious and are causing material impacts and disruption to major businesses around the world.
What’s the impact?
Which companies have said they are affected?
Mondelez and Reckitt Benckiser have recently announced impacts to sales linked to the recent attacks, with the former estimating a 300-basis point hit to Q2 sales growth, and the latter estimating 2% lower reported like-for-like net revenue growth in Q2. They are not alone – Kaspersky estimated that 2,000 computer systems were hit worldwide.
Using AlphaSense, I ran a Boolean search similar to the one below, and limited the results to a 90 day period.
(WannaCry OR Petya OR NotPetya OR ransomware OR (cyber attacks)) AND (decline OR affected OR hit OR impacted).
The results produced this list of companies reporting they were affected by cyber attacks:
Where are the attacks coming from?
The finger pointing has been primarily directed at Russia, China and North Korea. Mr Putin insinuated that the U.S. security agencies were the source for the WannaCry attacks, also noting that Russian companies were amongst the worst affected.
Regardless, one of the most impacted countries in recent years has been Ukraine – with attacks on government and commercial organizations occurring over the past few years. Both Reckitt and Mondelez have operations in Ukraine which are suspected of being the source of disruption to their businesses. Which begs the question…
Who else might be impacted?
While simply having a presence in Ukraine doesn’t mean a company will be affected, we can comb through filings and reports to see who has operations or offices there to try and anticipate those who could be. Here is a selection of some of the bigger names I found mention of having facilities or operations in the country:
Does anyone benefit?
Hackers are sent ransoms, but not as often as one might think.
The NotPetya attacks have been classed as “wipers” – designed to delete data instead of blocking access – indicating that it wasn’t primarily motivated by money. Victims are reported to have paid around $10,000 to get their data back, which seems small compared to the scale of the attack. There are reports however of institutions paying out thousands of dollars to undo the effects of ransomware.
Using AlphaSense Smart Synonym for Numbers* I found reports of a hotel in the Alps paying $1,600 to have their key system unlocked, hospitals paying $17,000 in 2016, and most notably of the South Korean hosting company, who paid $1 million to regain control of customer data. It is suggested that at least $130,000 has been paid to a bitcoin account linked to the WannaCry attack alone.
Companies looking to combat these attacks and prevent future ones are likely to be the real beneficiaries. Examples of companies referencing sales growth, improved guidance or market share related to cyber security over the past few months include:
Alongside that, cyber insurance is fast becoming a major part of the insurance industry – Allianz estimates the market could be worth $20bn per year globally by 2025. Insurance was largely unaffected by the attacks, thanks in part to the size of the ransoms being below policy excesses, and the impact being mainly in Europe and Asia, where adoption of insurance policies against cyber has been slower.
What’s the future?
As we have seen, it is no longer a case of malware simply saying, “Catch me if you can,” like the Creeper virus did. Cyber-attacks can and have caused material damage to companies and institutions and will surely continue to do so, while there are motives to drive them.
To sum up how cyber-attacks might affect companies in the future, here are 2 predictions from technology research specialist IDC made in January 2017:
Let’s hope they are wrong.
*Smart Synonym for Numbers is an expansion of AlphaSense Smart SynonymsTM, a proprietary, AI powered technology, that instantly expands your keyword searches while filtering out false positives. Use it to quickly find key business metrics buried in text documents by limiting your search to results that contain numerical references.
1. When hackers attack: Five famous computer viruses | Metro | 11 August 2010
2. The Money Bin | Westhouse Securities / Cyence | 01 June 2017
3. Update on Cyber-Attack and Preliminary Estimate of Financial Impacts | Press Release | 06 July 2017
4. Cyber attack update and estimated financial effect | Press Release | 06 July 2017
5. Global Cyberattack: What We Know and Don’t Know | NY Times | 28 June 2017
6. Putin blames US for WannaCry computer virus | Financial Times | 15 May 2017
7. NotPetya Ransomware Hackers Want 100 Bitcoins for Decryption Keys | Extreme Tech | 06 July 2017
8. Smarter homes open to more risk; Multiple devices increase chances of cyberattack; The smarter the home, the more online risks you face | The San Francisco Chronicle | 19 June 2017
9. Attack Hits Parts Of Health System – WSJ | Dow Jones News | 16 May 2017
10. Ransomware Tax Has Become Too Expensive to Ignore | IDC | 28 June 2017
11. Why ransomware attacks keep happening | CNN Money | 27 June 2017
12. Cyber insurance market expected to grow after WannaCry attack | Financial Times | 16 May 2017
13. IDC FutureScape: Worldwide IT Security Products and Services 2017 | IDC | 31 January 2017