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Mobile Network Providers Face a Potential Exodus of 74 Percent of Smartphone Users After a Security Breach

Survey reveals that hacked and insecure smartphones may trigger massive churn among disgruntled customers

BOXBOROUGH, Mass., Dec. 3, 2012 /PRNewswire/ -- Crossbeam Systems, Inc., the leading provider of next-generation security platforms for high-performance networks, today released research revealing that compromised security – more than high monthly fees – would be the biggest catalyst for triggering users to change mobile network providers.

(Photo: http://photos.prnewswire.com/prnh/20121203/NE21819-INFO )

(Logo: http://photos.prnewswire.com/prnh/20120330/NE79533LOGO )

An independent survey of smartphone users in the U.S., United Kingdom and Germany was conducted by market research firm Opinion Matters on behalf of Crossbeam. More than 1,000 adult smartphone users were polled in each country to examine usage habits, the importance of mobile security and data services, purchasing considerations, and what would motivate them to switch providers.

According to the survey, 63 percent of global respondents cite high monthly fees as the primary issue that would drive them away from their current mobile network provider, with only five percent citing a lack of security. However, if survey respondents' smartphones were to be compromised by hackers, malware or other security failures, 55 percent would consider changing providers and 19 percent would definitely change providers – leading to a potential exodus of 74 percent of customers.

This finding challenges network providers' conventional thinking about their investment priorities, with most aggressively focusing on building ever faster high-speed network infrastructure and attractive data plans, but less on shoring up their security infrastructure and offering value-added security services and protection to end users and their devices.

"Smartphone users, like most people, don't think about the security of their devices until they've been hacked. This may be misleading mobile network operators to focus less of their attention on customer security and underestimate the risk it creates," said Peter Doggart, senior director of global marketing at Crossbeam. "There is an inadequate level of investment in security compared to other areas of the mobile network. This is a wake-up call for service providers, especially as we're reaching a critical mass of smartphone users worldwide, not to mention the growth of data-enabled endpoints connecting to mobile phone networks, including smartphones, tablets, e-book readers and more. The quantity of threats directed at mobile devices and their level of sophistication are on the rise."

Mobile network providers will be blamed for smartphone attacks, regardless of fault
According to survey results, 56 percent of global respondents don't know if their mobile network provider has measures in place to secure their smartphone. Despite this uncertainty, 42 percent of U.S. and 38 percent of U.K. smartphone users would still blame their network provider if their device or service were to be hacked, while 22 percent and 18 percent, respectively, would blame their smartphone manufacturer.

German smartphone users are much less likely to blame their network provider; almost half (45%) say they would blame themselves before their provider (21%), yet they would be just as likely to leave their provider as their U.S. and U.K. counterparts following a security breach. This is despite the fact that 47 percent of German respondents claim to have security countermeasures (i.e., antivirus software, firewalls, etc.) installed on their smartphones – significantly higher than both the U.S. (35%) and the U.K. (26%). Mobile network providers will ultimately still be held responsible by their customers after a hack.

"The results indicate that mobile network providers will be blamed, regardless of who's at fault," added Doggart. "This more than anything reveals an important opportunity for providers to be proactive about securing their networks in order to gain customers and minimize churn. As smartphone attacks become more prevalent, the service providers who anticipated the increased need for security and took the time to prepare will be in the best competitive position."

The good news: smartphone users are willing to pay extra for security
Despite the majority of smartphone users' concern with high fees, 53 percent of global respondents expressed a willingness to pay their network provider additional fees to help improve security. Regionally, 59 percent of U.S. and 65 percent of German respondents would be willing to pay extra for security services, although almost two-thirds of U.K. respondents (63%) were against any type of additional fee.

Loss of personal information tops list of smartphone users' concerns
The survey also found that in the event of a smartphone security breach, access to personal information such as credit card numbers and passwords worried most (60%) users. More than 42 percent worried about losing their stored contacts, and almost half (45%) were worried about access to their private media (i.e., photos, videos, text messages, etc.).

An encouraging sign for security awareness, 43 percent of respondents were cognizant that their smartphone contained applications that stored or had access to sensitive financial information.

For more information and to download the full survey report, please visit http://www.crossbeam.com/opinion-matters-reg/.

For more information on how Crossbeam's X-Series platform is securing mobile operator networks, please visit: http://www.crossbeam.com/solutions/securing-the-mobile-network/.

About Crossbeam
Crossbeam Systems®, Inc. offers a proven approach to deploying network security that meets the extreme performance, scalability and reliability demands of large enterprises, service providers and government agencies. Its leading X-Series security platform offers an open, high-performance architecture that easily provisions and scales multiple best-in-class security applications to meet the ever-changing threat landscape. Companies rely on Crossbeam to intelligently manage risk, accelerate and maintain compliance, and protect their businesses from evolving threats. Crossbeam is headquartered in Boxborough, Mass., and has offices in Europe, Latin America and Asia Pacific. More information is available at www.crossbeam.com.

Crossbeam Systems and Crossbeam are registered trademarks of Crossbeam Systems, Inc. All other company, product or service names not owned by Crossbeam mentioned in this press release are the property of their respective owners.

Contact: Sharon Dratch
Davies Murphy Group
(781) 418-2425
[email protected]

SOURCE Crossbeam Systems, Inc.

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