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Big Email Hack Doesn't Exactly Send the Message Yahoo Needed

Big Email Hack Doesn't Exactly Send the Message Yahoo Needed o3y3k

By Associated Press | Updated: 23 September 2016 16:29 IST

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Yahoo has been struggling for years to keep people coming back to its digital services such as email. That challenge just got more daunting after hackers stole sensitive information from at least 500 million s. 4c4b4z

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(Also see: Yahoo Hack: What You Should Do if You Have an )

Some snarky online commentators quipped that the hack would have been far more devastating if people actually still used the company's services. While there's some truth to that observation, millions around the world still rely on Yahoo mail and other services, and are now potentially at risk of identity theft or worse.

Losing s
And if these people give up on Yahoo as a result, the consequences for the company itself - now scheduled to become part of Verizon as soon as its $4.8 billion deal closes - could also be dire. "Yahoo may very well be facing an existential crisis," said Corey Williams, senior director of products and marketing at the computer security firm Centrify.

Yahoo was already facing a steep decline in email traffic, despite CEO Marissa Mayer's efforts to upgrade the service in order to foster more loyalty. In July, 161 million people worldwide used Yahoo email on personal computers, a 30 percent decline from the same time in 2014, when the breach first occurred. That's according to the latest data from the research firm comScore. By contrast, Google's rival Gmail service saw desktop s rise 9 percent to nearly 429 million over the same period.

The email breach raises questions about Yahoo's ability to maintain secure and effective services, particularly since it's been laying off staff and trimming expenses to counter a steep drop in revenue over the past eight years.

At the time of the break-in, Yahoo's security team was led by Alex Stamos, a respected industry executive who left last year to take a similar job at Facebook.

Once more unto the breach
Yahoo didn't explain what took so long to uncover a heist that it blamed on a "state-sponsored actor" - parlance for a hacker working on behalf of a foreign government.

The Sunnyvale, California, company declined to explain how it reached its conclusions about the attack for security reasons, but said it is working with the FBI and other law enforcement. Yahoo began investigating a possible breach in July, around the time the tech site Motherboard reported that a hacker who uses the name "Peace" was trying to sell information belonging to 200 million Yahoo s.

Yahoo didn't find evidence of that reported hack, but additional digging later uncovered a far larger, allegedly state-sponsored attack.

"We take these types of breaches very seriously and will determine how this occurred and who is responsible," the FBI said in a Thursday statement.

Most s ever stolen
The Yahoo theft represents the most s ever stolen from a single email provider, according to computer security analyst Avivah Litan with the technology research firm Gartner Inc.

"It's a shocking number," Litan said. "This is a pretty big deal that is probably going to cost them tens of millions of dollars. Regulators and lawyers are going to have a field day with this one."

Yahoo says it has more than 1 billion monthly s, although it hasn't disclosed how many of those people have email s.

The data stolen from Yahoo includes s' names, email addresses, telephone numbers, birth dates, scrambled s, and the security questions - and answers - used to an holder's identity. The company said the attacker didn't get any information about its s' bank s or credit and debit cards.

Security experts say the Yahoo theft could hurt the affected s if their personal information is mined to break into other online services or used for identity theft. All affected s will be notified about the theft and advised how to protect themselves, according to the company.

Yahoo also is recommending that all s change their s if they haven't done so since 2014. If the same is used to access other sites, it should be changed too, as should any security questions similar to those used on Yahoo.

The Verizon impact
News of the security lapse could cause some people to have second thoughts about relying on Yahoo's services, raising a prickly issue for the company as it tries to sell its digital operations to Verizon.

That deal, announced two months ago, isn't supposed to close until early next year. That leaves Verizon with wiggle room to renegotiate the purchase price or even back out if it believes the security breach will harm Yahoo's business. That could happen if s shun Yahoo or file lawsuits because they're incensed by the theft of their personal information.

Verizon said it still doesn't know enough about the Yahoo break-in to assess the potential consequences. "We will evaluate as the investigation continues through the lens of overall Verizon interests, including consumers, customers, shareholders and related communities," the company said in a statement.

Delay of sale?
At the very least, Verizon is going to need more time to assess what it will be getting into if it proceeds with its plans to take over Yahoo, said Scott Vernick, an attorney specializing in data security for the law firm Fox Rothschild.

"This is going to slow things down. There is going to be a lot of blood, sweat and tears shed on this" Vernick said. "A buyer needs to understand the cyber-security strengths and weaknesses of its target these days."

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