Years of pain for Optus in data hack
OPTUS is facing up to five years of reputational damage and a hit to its bottom line worth millions of dollars as customers abandon it due to a cyber attack that saw the data of nearly 10 million Australians accessed by hackers.
Customers and politicians have slammed the telco over the incident, particularly over the time taken to inform the public of the attack. The threats to Optus’s subscriber base are serious, according to associate professor in regulation and governance at the UNSW Business School Rob Nicholls.
The public outcry over the incident on social media and from the government presents a “high level of peer pressure” that will nudge customers away, he said.
“For people looking at their social media feeds and the news, they will be asking themselves, ‘Should I stay with Optus?’ ” Prof Nicholls said.
He said it could take up to three years and a significant effort from Optus to regain trust, but others say it could take even longer for the telco’s brand to recover.
“People are quite forgiving in the long term, but that can take a couple of years,” University of Sydney associate professor Tom Van Laer said.
He compared the potential fallout from the hacking scandal with that of the Deepwater Horizon oil spill, saying people “skipped” BP service stations afterwards and that it took the company between three and five years to return to normal.
Not only is Optus facing years of reputational damage, it is also staring down the barrel of millions of dollars of remedial costs to customers.
“The internal cost is going to look something like $140 per record that was lost, as well as the remediation costs,” Prof Nicholls said.
Those remediation costs are set to balloon, with Optus to foot the bill for new passports and drivers licences for about 2.8 million people, according to the federal and some state governments.
Affected customers will not have to fork out the $193 cost for a replacement passport, nor the licence replacement fee of $29 in NSW and $42.60 in the ACT.