US retailers feel pressure to beef up cybersecurity spending- report
Security experts and providers of IT services said the decision of Target Corp to accelerate a $100 million program so it would be able to use chip-enabled smart cards represents a minute portion of what retailers rally need to do to safeguard themselves against hacking attacks, Reuters reported.
US merchants are feeling the pressure to bolster their cyber security spending even as they are already battling Amazon.com to the tune of millions of dollars and racing to face a deadline in October 2015 given by Visa Inc and MasterCard Inc for the acceptance of new cards that put information on computer chips instead of the usual magnetic stripes. Countries in Europe and Asia have already adopted the system which processes cards that have tiny microprocessors that makes it more difficult for cyber criminals to utilize information they have obtained illegally, the report said.
According to security experts and IT providers, retailers in the US have been so intent on reducing their costs and making their presence felt online in the past ten years that they have not sufficiently spent their technology budgets to safeguard customer data. Citing data from technology advisory firm IDC Retail Insights, stores in the US only spent about 2% of their tech security budgets even as retail spending on total technology was forecasted to rise 4% each year from 2012 to 2017.Most of the budget is deployed to enhancing the retailers' e-commerce, the report said.
Security experts added that majority of the merchants are only content with meeting the basic standards that the payment card industry has required instead of significantly bolstering the protection they have to guard against more sophisticated attacks, unlike what their peers in other industries are doing, the report said.
Verizon Enterprise Solutions Vice President Eddie Schwartz told Reuters in an interview that retailers have to be more proactive. He added, "Retailers have to assume that they are constantly being targeted and actually constantly being penetrated."