The volume of data being so much greater and the nature of it being so much more sensitive, data loss can throw a company out of business altogether too. Below are the examples of three such industries that are data-dependent, and what happens when they lose data.

R & D Companies and Data Loss

Research and development forms the backbone of industrial growth today. The power of information has long surpassed the power of capital or land. So when an R&D company loses its data, it loses out precisely its means of livelihood, and the product of many years of hard work on the part of brilliant and hard-working people. On the other hand, it is small surprise that data thieves would aim at such companies and try out every devious trick in their books to get hold of the data.

Let us take the example of the five employees of Ernst and Young. Out on a happy conference at a Pacific hot spot, they went out for a stroll in the break, leaving their laptops in the conference room. When they returned from their jolly walk in the sun, the laptops were gone – along with a huge data base of hundreds of HP employees. Ernst and Young tried to cover it up, followed by a similar attempt by HP. Both failed badly, thanks to bloggers, negative press and irate clients. The laptops did not even have proper encryption for the data.

Banks, Financial Institutions and Data Loss

We keep our money in the bank because we trust them more than our own houses. A bank or a financial institution has our personal details as well as part of their own verification. So the mass effect of data loss from financial institutions is greater than any other type of industries.

In an incident last year, a vacation booking firm’s server was hacked into, and the thieves ran away with the credit card details of millions of customers who had used their cards to book everything from travel packages, flights, to hotels etc through this site.

Let us take the Newcastle town Council. It lost the credit card details of 54,000 UK residents thanks to a security breach in its website. So the payment details of council tax, business rates, parking fines, rents etc. of various people from February 2006 to April 2007 are in the wrong hands right now. These were all made through credit cards of various banks. The official spokesperson on behalf of the council said that it would be better not to notify all the people concerned. In their bid to stave off large-scale panic, the council has endangered the monies of all these people.

Film and Advertising Industry and Data Loss

The film and advertising industry is another sector that is hit hard by data loss. Firstly, it is almost impossible to rebuild a film or ad all over again if its edited version is lost. Secondly, the inherently large file size of media formats makes the data more prone to corruption. And apart from these generic issues, the greatest threat posed to the film, printing, advertising and music industry at this moment is rampant piracy. For those who still look indulgently on these matters, the UK loses £406 million per year in revenue and £90 million in tax to piracy. The Academy of Motion Pictures, USA, has been trying to fight piracy through a four-pronged approach of education, litigation, encryption and enforcement. Truthfully speaking, not much has happened that is yet to mark as an improvement.

Do They Even Close Down?

Yes, companies will close down after a massive data loss incident. 40% of UK companies that face data loss without a recovery plan in place shut shop forever. The sectors mentioned above are in particular, sitting ducks for data thieves and pirates. These businesses are all heavily dependent on their data base, updating it regularly is very common, and losing their clientele can be their death knell. The awareness level in general on issues such as Intellectual Property theft, copyrights, encrypting all sensitive data, and having a continuous remote backup in place has not yet reached the required level. Most companies still learn through mistakes rather than observation.