Question: Existing virus-protection programs rely on virus databases that constantly need to be updated as new viruses emerge. A typical virus-protection site license costs $3,000 per

 Existing virus-protection programs rely on virus databases that constantly need to

Existing virus-protection programs rely on virus databases that constantly need to be updated as new viruses emerge. A typical virus-protection site license costs $3,000 per year for sites of less than 350 machines, and must be updated regularly. Regular updating of the databases costs around $60 per computer per year. Furthermore, even with regular updating of the databases, there is a possibility that unaccounted viruses will infect a company's computer systems. Virus- protection experts estimate that with current virus protection software the probability that a company will experience one complete system breakdown because of a virus within one year is 8%. Of the 8% of companies who experience a system breakdown, 25% also experience a second breakdown sometime thereafter. The probability of more than two breakdowns is virtually zero. A complete system breakdown, which typically lasts one day, would cost $35,000 to a retail company with 175 machines and $90,000 (in prots from lost sales) to a typical nancial services company with the same number of machines. McBug Software Inc. is about to introduce new virus-protection software called HackOff. HackOff is based on a \"mutating-virussimulator\" (MV S), which according to McBug is going to revolutionize the virus-protection landscape. The MV S essentially eliminates the need to update virus databases continually. Moreover, the MVS is extremely powerful and, as a result, increases the probability of detecting infected les. Researchers at McBug estimate that companies equipped with HackOff have only a 1% probability of experiencing a virus-caused complete system breakdown within a year, and a zero probability of experiencing more than one of such breakdowns. While the price of a HackOff site-license remains to be set, it is estimated that clients who adopt the software would incur start-up costs (excluding the site license) of $35 per machine in installation, conguration, training, etc. Assuming no other costs of virus infection or software, calculate the economic value of HackOff over the course of one year

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Marketing Questions!