Sony Corp. chief executive officer Howard Stringer apologized to users of its PlayStation Network and other online services, breaking his silence on the biggest Internet security break-in ever, but failed to provide a date when services would resume.
Mr. Stringer’s comments come after he faced criticism of his leadership since Sony revealed hackers had compromised the data of more than 100 million accounts used for accessing games and music over the Internet.
“As a company we – and I – apologize for the inconvenience and concern caused by this attack,” Mr. Stringer said in comments posted on Sony’s U.S. PlayStation blog late on Thursday.
The incident may prove to be a significant setback for a company looking to recover after being outmanoeuvred by Apple in portable music and Samsung Electronics in flat-screen TVs and which faces a tough fight in video games with Nintendo and Microsoft.
One analyst said security concerns could weigh on sales of Sony’s gadgets and hurt growth prospects for its network services.
“There is a real concern that trust in Sony’s business will decline,” Kota Ezawa, analyst at Citigroup Global Markets Japan, wrote in a note ahead of the comments from Stringer.
“The network business itself still only makes a small direct contribution to earnings, but we see a potential drop in hardware sales as a concern.”
But Peter Walshe, senior director at global brands research agency Millward Brown, said the main Sony brand should bounce back, although PlayStation specifically might suffer.
“The parent brand is likely to be more resilient,” he told Reuters by telephone. “Sony is one of the most trusted brands in the world, while Sony PlayStation has quite a low trust score to begin with.”
“People may shout: ‘I’m never going to buy Sony again,’ but in our experience that doesn’t tend to happen.”
The Internet breaches sparked thousands of comments on the official PlayStation fan page on Facebook and on its blog, some of them from users who said they would switch to Microsoft’s Xbox Live games network.
Although video game hardware and software sales have declined globally, the PlayStation Network is a key initiative for the electronics company.
On Friday, Sony shares ended 2.3 per cent lower in a broader market down 1.5 per cent, extending its total losses to about 6 per cent since it revealed the breach. The Nikkei is up around 3 per cent over the same period.
Sony issued its first warning on the break-in a week after it detected a problem with the network on April 19, infuriating many PlayStation users around the world. Sony said it needed time to work out the extent of the damage.
“I know some believe we should have notified our customers earlier than we did. It’s a fair question,” Mr. Stringer said.
“I wish we could have gotten the answers we needed sooner, but forensic analysis is a complex, time-consuming process. Hackers, after all, do their best to cover their tracks, and it took some time for our experts to find those tracks and begin to identify what personal information had – or had not – been taken.”
Mr. Stringer said Sony would restore network services “in the coming days,” but gave no date.
“That’s all well and good, but when exactly is the PSN going to be back up? “Coming Days” could be tomorrow or it could be weeks from now,” a user called Morac said on the PlayStation blog.
Sony’s handling of a massive Internet security breach is becoming a public relations nightmare reminiscent of Toyota Motor’s bungled response to a series of vehicle recalls last year, fuelling criticism of Japan Inc’s standards of disclosure.
“The initial response was definitely slow,” said Yasuyuki Katagi, president of Ogilvy Public Relations Worldwide (Japan).
He said Japanese firms were used to keeping problems quiet because local customers would assume they were taking steps to fix things.
