President Barack Obama said it in a major speech on cybersecurity. U.S. senators said it while promoting their Cyber Security Act of 2012. Gen. Keith Alexander, director of the National Security Agency and head of the U.S. Cyber Command, said it while warning of "the greatest transfer of wealth in history" through the theft of intellectual property. "It" was that the costs of cybercrime are $250 billion each year according to Symantec and $1 trillion each year accoridng to McAfee.
But those estimated costs for cybercrime are inflated, a report from the public-interest watchdog group ProPublica says. (It also notes that the widely cited $1 trillion figure was not even in the actual McAfee report, but in the press releases about it.)
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ProPublica is not alone in exposing such inflated estimates from vendors that stand to profit from creating fears about cybercrime. Computer scientists Dinei Florencio and Cormac Herley of Microsoft Research, authors of the recent paper "Sex, Lies, and Cybercrime Surveys (PDF)" recently wrote, "Our assessment of the quality of cyber-crime surveys is harsh: they are so compromised and biased that no faith whatever can be placed in their findings."
The ProPublica report saus the McAfee estimate is disputed by some of those who analyzed data for the 2009 report, which was based on information gathered from a survey of 1,000 IT professionals.
Eugene Spafford, one of three independent researchers from Purdue University, told them: "I was really kind of appalled when the number came out in news reports, the trillion dollars, because that was just way, way large."
Another researcher, Ross Anderson, a security engineering professor at University of Cambridge, told ProPublica he "would have objected at the time had I known about [the $1 trillion estimate]. The intellectual quality of this is below abysmal."
"[The Symantec estimate] was indeed mentioned in a Symantec report, but it is not a Symantec number and its source remains a mystery," the report said.
Sal Viveros, a McAfee public relations official who oversaw the 2009 report, had not responded to a request for comment by the deadline for this story. But he wrote in an email to ProPublica: "We work with think tanks and universities to make sure our reports are non-biased and as accurate as possible."
Other security experts and analysts tend to agree with ProPublica, saying not only that the estimates are inflated but that any estimate from a security vendor should be treated with skepticism, because there is a built-in conflict of interest -- the worse the security risks and costs are, the better it is for their business.
In addition, industry reports are not subject to the kind of peer review that is done for academic and professional journals.
But experts are also willing to cut the companies some slack, for a couple of reasons. First, it is very difficult to estimate such things. Sometimes, companies don't even know they have been attacked. Many times, when they find out, they don't want to talk about it, lest they damage their brand. And sometimes it is difficult to know how much actual damage has occurred.