Sony Begins to Tally Its Financial Loss From Hack: $15 Million and Counting

[Audrey McNeil <audrey () riskbasedsecurity com>]

http://recode.net/2015/02/04/sony-begins-to-tally-its-financial-loss-from-hack-15-million-and-counting/

Sony has begun to disclose the financial toll of the crippling cyber attack
on Sony Pictures Entertainment.

The disruptions caused by the November hack on the U.S.-based film and TV
group forced the Tokyo corporation to delay reporting of its December
quarter results, because Sony Pictures was unable to close its financial
books within the required timeframe.

Sony provided a forecast of its results Wednesday, which, for the first
time, began to provide a financial accounting of the damage caused by the
cyber assault.

The film group reported it has incurred about $15 million in investigative
and remediation costs related to the attack on its corporate networks,
which pilfered private emails and confidential business documents, and
destroyed computers.

Numerous press reports recount how the studio was taken back to the digital
Stone Age, with its payroll department cutting checks manually and
executives resorting to a form of mobile communication that had fallen out
of vogue in Hollywood: BlackBerrys.

Sony told investors the cyber attack will likely not materially impact its
results for the fiscal year that ends March 31. However, it warns that it
might not be able to anticipate and manage the cyber security risk,
“including the risk of potential business disruptions or financial losses.”

Other corporations that have been subject to breaches faced steep bills.
Target reported the price tag for its 2013 breach would reach $148 million
(with $38 million offset by insurance), while TJX’s 2007 hack will cost
about $250 million.

Former employees of Sony Pictures Entertainment have filed four lawsuits
against the company following the massive security breach. The suits allege
the film group failed to adequately safeguard its networks against cyber
intrusions.

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