As Tarzan once explained to Jane, “You wouldn’t believe it honey; it’s a real jungle out there.” Now comes PlayStation-Gate: Howard Stringer, the CEO of Sony, had to admit he couldn’t guarantee users the security they expect when they supply personal and financial information to Sony over the Web. Furthermore, Singer asserted that it is not just Sony’s problem, but the shape of things to come. In Singer’s words, “It’s not a brave new world; it’s a bad new world.”
Cyberattacks aimed at Sony led to the theft of 10,000+ debit card records in Europe and 12,000+ non-U.S. credit or debit card numbers. But wait, that was only day one. Shortly thereafter, another 77 million (yes, million) user accounts were looted. Chastened and more than a bit defensive, Sony says there are no guarantees in this brave, new cyber-insecure world.
Sony is more right than wrong, if only because the economics of cyber-security favors attackers over defenders. Smart, creative 15-year olds with time on their hands can often learn how to do minor (and sometimes major) damage with a few mouse clicks and keyboard strokes. Highly motivated crooks, well – you get the idea.
Where does that leave Sony, and the rest of us? Companies with exposure will, of course, invest more in security and pass on the costs when they can. And, to the chagrin of openness advocates, we will likely drift back to “walled gardens,” the virtual equivalent of gated communities. Companies doing commerce on the Web will raise the bar on who can enter and how they prove their bona fides. Moreover, if the problem becomes unmanageable with only modest changes, the modest part will be dropped: We may be asked to give up anonymity on the Internet, trading off some privacy for enhanced security.
But it may not come to that. So long as there are profits to be made from ensuring privacy and security, enterprising grad students at Stanford (or MIT or Podunk U) will be looking for entirely new fixes for the security conundrum.
It’s a hoary theme, but hardly a worn out one: In industries that require more brains than capital to make a splash, free markets can (and usually do) work magic. Few industries fit the criterion better than information technology.