Hypo Venture Capital - Hypo Venture Capital Headlines: Stringer blindsided by Sony hackers who probed flaws1

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Sony Corp, besieged by hackers since April, considered its PlayStation Network an unlikely target even after threats by the online collective Anonymous and three

separate security incidents in 2008.

The hacker group declared in April that it would wage a cyber war against Sony for trying to stop people from tinkering with the PlayStation 3. Three years earlier, the company

faced three breaches in Europe, including one in which Sony said some PlayStation Network user data might have been stolen.

The repeated incidents should have warned Sony its online network was vulnerable, said Eugene Spafford, a computer science professor at Purdue University in West Lafayette,

Indiana. The failure to enact safeguards such as appointing a single chief of security may show Sony misunderstands the risks inherent in Chairman and Chief Executive Officer

Howard Stringer’s networked strategy, he said.

“The evidence we’ve seen so far speaks to a lack of a good data management plan and a good security plan,” said Spafford, who specialises in information security, computer crime

investigation and information ethics.

Japan’s Ministry of Economy, Trade and Industry said today it told Sony to carry out preventive measures against data breaches, instructed the company to ease customer

concerns over misuse of credit cards and share more information among affiliates.

Sony has struggled to keep up with the barrage that started in mid-April. The Qriocity and PlayStation Network entertainment services were knocked out for almost a month,

compromising data in more than 100 million accounts.

In the past week, the Tokyo-based company has been hit with smaller intrusions — a breach at online-service unit So-net Entertainment led to the misuse of user names and

passwords of 128 customers. This week, Sony shut web pages that were targeted in Greece, Canada, Thailand and Indonesia.

The PlayStation Network will resume in Japan, Taiwan, Singapore, Malaysia, Indonesia and Thailand tomorrow, while services in South Korea and Hong Kong will remain suspended

until further notice.

“Obviously our network security didn’t stop the attack and we’re trying to understand why, and we’ve made big strides in bolstering our security,” Stringer said in a May 17

interview, before the most recent incidents.

Sony believed it had “good, robust security,” Stringer said. He rejected suggestions that the company is paying for a lack of vigilance and said he was unaware of the 2008 intrusion

on the PlayStation Network.

Since most users of PSN don’t pay, and most threats focus on stealing credit card information, the theft of passwords and other personal data from those services appeared less

likely, Stringer said.

“We have a network that gave people services free,” Stringer said. “It didn’t seem like the likeliest place for an attack.”

When the April incursion first started, he didn’t know how serious it was, Stringer said. “I really don’t think I could apologise for not knowing,” he said. “It’s a whole new experience

for everybody at this scale.”

Anonymous Vow There were warning signs. Sony was singled out for retaliation by Anonymous, the hacker group that brought down the websites of MasterCard Inc in December,

after the company sued 21-year-old George “GeoHot” Hotz for posting information on how to modify the PlayStation game console. The case was settled on March 31.

Anonymous announced its revenge campaign, “Operation Payback,” on the website anonnews.org. In an early May statement, the group denied involvement in the PlayStation and

Qriocity breaches, while saying some members of the loosely organised collective may have been behind it.

Sony, Japan’s largest consumer-electronics exporter, must connect its televisions, Blu-ray players, game consoles and digital cameras via the Internet to music, movies and video

games, Stringer has said. Unconnected devices rapidly become commodities as rivals compete for customers, he has said.

Sony’s investigation into the cause and search for suspects in the mid-April attack is ongoing, the company said. In a letter to US lawmakers today, the company said it believes it

knows how the network was penetrated. The company said it doesn’t know who was responsible or precisely how much information was taken.

‘Failure of Trust’ On May 23, Sony said it may spend more than $170 million related to the hack. The company also said it discovered personal data may have been stolen from 8,500

user accounts in a music entertainment site in Greece.

The company erred in “thinking of these incidents in terms of a breach of systems” and communicating with its customers based on the severity of the failure, said Kevin Kosh, a

partner at Waltham, Massachusetts-based Chen PR, which represents technology companies.

“When you’re a consumer-facing organisation, that’s not the way you should think,” Kosh said. “It’s first and foremost a business failure and a failure of trust.”