TalkTalk has revealed that it is setting aside £35 million in costs for dealing with its recent security breach, but claims that the issue will not affect its long-term growth prospects.
TalkTalk hit headlines in the worst way possible when it confirmed that its systems had been breached
as part of a 'significant and sustained cyber attack
.' Embarrassingly, the company admitted that it did not know exactly what was accessed nor whether any of the data it stored on its customers was encrypted - with the embarrassment leading to shock when company head Baroness Harding admitted that the data, including bank details, had not been encrypted
as there was no legal requirement under the Data Protection Act for the company to do so.
Following on from four arrests relating to the attack, which TalkTalk has said is not as serious as first feared
, Harding told the BBC
that the company has estimated the attack will have cost it between £30 million and £35 million in one-off costs. 'That's covering the response to the incident, the incremental calls into our call centres, obviously the additional IT and technology costs, and then the fact that over the last three weeks until yesterday our online sales sites have been down, so there will be lost revenue as a result,
' she explained.
Despite this, and the negative publicity for what was merely the most serious of the four breaches the company has suffered since the start of this year, Harding claimed the company was still 'well positioned to deliver strong and sustainable long-term growth
' and that an initial flood of customers cancelling Direct Debits to the company has been largely reversed. She also claimed that customers affected by the breach would be offered a package upgrade by way of compensation, but did not provide details.