Want AI to work for your business? Then privacy needs to come first

Cisco has released a “2025 Data Privacy Benchmark Study” that looks at the privacy challenges companies face with the rise of artificial intelligence. It offers practical insights for businesses that want to integrate AI while keeping privacy front and center.

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The study gathered opinions from 2,600 privacy and security professionals across 12 countries.

A key finding is that most companies (86%) support privacy laws, citing a “positive” impact on their business operations. Although compliance can be costly, 96% of organizations reported that the benefits significantly outweigh the investment.

Where to store data

One major issue companies face today is deciding where to store their data. 

Many businesses (90%) prefer to store data locally, believing it’s safer, even though it can be more expensive and complicated. At the same time, more businesses are trusting large global providers — companies like Cisco itself — to handle their data securely. As many as 91% of companies now believe global providers offer better protection, up from 86% the previous year.

As AI technologies, particularly generative AI tools like ChatGPT, have become more common, the study found that 63% of respondents say they now understand these technologies well. However, professionals’ growing use of AI has introduced new risks.

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Almost two-thirds (64%) of professionals worry about accidentally sharing sensitive or confidential information through AI tools. Surprisingly, nearly half said they’ve already put private or employee data into AI systems, showing a real gap between knowing the risks and taking action.

Dev Stahlkopf, Cisco’s chief legal officer, said strong privacy practices are essential for the safe use of AI: “For businesses moving towards using AI, privacy measures form the necessary groundwork to manage AI responsibly.”

Shifting budgets to AI

Cisco’s study found that companies are shifting budgets from general privacy spending to AI-related efforts. 

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Nearly all businesses (99%) plan to allocate some privacy funding toward AI over the next year. Cisco said its “2024 AI Readiness Index” shows that companies expect to nearly double their AI-related IT budgets, underscoring their serious attitude to AI safety.

Privacy as a competitive advantage

Cisco wrapped up its findings by looking at consumer views on privacy. 

According to its “2024 Consumer Privacy Survey,” over half of global consumers (53%) are aware of privacy laws in their countries. Among these respondents, 81% feel confident in their ability to protect their data — compared to just 44% who are unaware of such laws.

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Overall, the study shows that good privacy practices aren’t just about legal compliance — they’re a key part of business success. As AI becomes more popular, companies that handle data responsibly are more likely to earn customer trust and stay competitive.