Security moved to the top of the list from its number two spot in the 2003 survey, replacing network reliability and availability as the most critical network attribute.
The survey of 254 senior executives reported that while businesses worry about security, the majority wanted to open their networks to customers and mobile workers.
"Isolation leads to irrelevance for enterprises that can't protect their networks," says Hossein Eslambolchi, president of global networking technology services at AT&T. "Unless security is managed effectively, executives are right in thinking that cyber attacks may prove the toughest threat to the sustained development of the networked enterprise."
On average, firms devoted 9 per cent of the IT budget to network security in 2002; the figure rose to 11 per cent last year and is expected to reach 13 per cent in 2004.
The biggest vulnerability was attributed to people - respondents believed that 83 per cent of attacks originated internally and 78 per cent admitted to having opened an email attachment from an unknown person.
The worldwide impact of cyber attacks has grown steadily from $3.3 billion in 1997 to an estimated $12 billion in 2003, according to research from Computer Economics in Carlsbad, California.