Sony Apologizes, Offers $1 Million Insurance After Hacking
Sony Corp. (6758) Chairman Howard Stringer apologized and offered U.S. customers of PlayStation Network and Qriocity online entertainment services a year of free identity- theft protection after the system was crippled by hackers.
Japan’s biggest consumer-electronics exporter will offer a $1 million insurance policy per user, covering legal expenses, identity-restoration costs and lost wages that occur after data is stolen, Sony said in a blog post. Austin, Texas-based Debix Inc. was hired to provide the monitoring service and similar programs for users in other countries are also being considered, it said.
The announcement follows last month’s hacking of Sony’s online entertainment and games platforms when the Tokyo-based company was criticized by U.S. lawmakers for not informing users of the breach quick enough. The shares fell to their lowest in a week in Tokyo today after Sony increased the total number of accounts that were comprised to 101.6 million.
“This is an unprecedented case of information theft in terms of the number of accounts involved,” said Nobuo Kurahashi, an analyst at Mizuho Financial Group Inc. in Tokyo. “There are lots of uncertainties including lawsuits, making it difficult to estimate the company’s overall expense.”
U.S. subscribers have until June 18 to sign up for Debix’s AllClear ID Plus protection program, said Patrick Seybold, a Sony spokesman for the video-games unit.
‘Frustrating Time’
Sony didn’t elaborate whether the program will cover identity theft that isn’t related to the mid-April breach of the PlayStation and Qriocity networks, which affected 77 million accounts. Separately, some 24.6 million users of the Sony Online Entertainment platform were also affected, the company said.
“I know this is a frustrating time for all of you,” Chief Executive Officer Stringer said in the blog post. “Let me assure you that the resources of this company have been focused on investigating the entire nature and impact of the cyber attack we’ve all experienced and on fixing it.”
Kazuo Hirai, Sony’s executive deputy president in charge of consumer products and network services, apologized May 1 for the breach and said the company aims to restore the online gaming center by the end of the month after upgrading security. Hirai and two other officials bowed in apology at a press conference in Tokyo, and said Sony can’t rule out credit card numbers and expiry dates having been stolen. The company is cooperating with authorities, including the Federal Bureau of Investigation.
Legal Backlash
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