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Congressional Cliff Notes: Sony's $21billion Bill to Taxpayers

VGW: For the past 6 years, data tracking agencies have estimated approximately 100 million breaches of data each year. While this may sound like an insanely high number, consider now that for 2011, Sony has 100 million breaches on their own. The magnitude of this is starting to become clearer. However his statement contained more frightening information as he details that it is estimated for each of these records breached, it costs approximately $214 in clean-up. That means that for a breach involving 100 million records, the total dollar value skyrockets to $21 billion. Keep in mind that this figure does not include the national investigation agencies involved such as Homeland Security or the FBI. That total, Spafford guesstimates at around an addition $100 million. Who foots this bill? The U.S. taxpayers, naturally.

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Shane Kim3496d ago

Death to capitalizm and the monetary system!

FragGen3496d ago

I'm not sure what I'm looking forward to more, the return of multiplayer on PS3 or an end to unfounded unresearched page hit trolling blog posts about PSN on N4G.

milohighclub3496d ago

I'm sure Sony are real fucking sorry they didn't attend ur poncy fucking meeting. instead they hard at work trying to sort out this mess.
by the way it'd only taken what 5/6 years to hack. pretty impressive to say most shit is hacked within months of release. These nobs need to get the fuck of Sony's back and let them get on with it.

Trey_4_life3496d ago (Edited 3496d ago )

Death to Al qaeda and osama bin......oh wait nvm.....!!

paladinaz3496d ago

US taxpayers? What are they going to pay for? Fast food? Out of all info, there is only 900 functioning credit card info leaked.

Pathetic articles, complete bs...

BShea3496d ago (Edited 3496d ago )

I think if you read the article a bit more thoroughly, you'd understand it a bit more paladinaz.

Information Minister3496d ago (Edited 3496d ago )

Having read through the entire article, I can honestly say that I now understand just about the same as I did after reading the headline. The author claims that there's a $21 billion clean-up bill to pay ($214 for each PSN account) and repeatedly points the finger at Sony for not picking up the tab. However, he never clarifies what exactly are these "clean-up costs", why do they fall on tax payers and, most of all, why are the US tax payers "footing the bill" for all the breaches when they represent less than half the total worldwide number of PSN/SOE users.

These are some questions I would really like to see answered. And until they are, I will take this article with a large pinch of salt. If you or anyone else were able to draw further conclusions from the article, or are otherwise more informed on the matter, please feel free to share.

killyourfm3496d ago

@Information Minister: First, kudos for the most intelligent and ground reply I've seen here in months. Second, I'd say I'm willing to trust someone who has spent 30 years in the information security sector when he tells us that the bill for this kind of thing gets passed on to consumers.

That said, I agree that I'd love to hear more specifics as to the how and why involved with this.

FragGen3496d ago (Edited 3496d ago )

@BShea: Actually if YOU read the article a bit more thoroughly and actually understood it (or rather saw all the glaring holes in it), you'd have realized this is a bulsh*t flame bait article to try to generate web traffic for the host site.

@killyourfm: Actually it's incredibly common for well credentialed "experts" to present absolute worst case batsh*t crazy scenarios at congressional hearings. They have a a vested interest in making sure their area of expertise appears to be an absolute emergency that needs funding now.

That article is missing a TON of information and the author is jumping to ridiculous conclusions without any kind of explanation or rationale.

jbomber3496d ago

@Information Minister -- While Spafford speaks in generalities, he mainly points to the the sheer cost of man power. You have to realize that Sony has hired not one, not two, but three external agencies to investigate this breach. Each of these agencies will charge 'x' dollars for their service for their people. In addition to the agencies, there is the loss of revenue from PSN being down. That is the cost on Sony's end.

The cost for tax payers comes from the FBI and HLS getting involved. Again, each of these agencies has a dollar value attached to the hours and manpower. Also, I cannot imagine a Congressional hearing is cost-effective. It is, after all, the government we're talking about here. :)

Christopher3496d ago (Edited 3496d ago )

***The cost for tax payers comes from the FBI and HLS getting involved.***

A cost that is already covered by annual budgeting and includes reasoning for these agency members working to protect all paying taxpayers from external sources, most often onsite at a company or government agency's location. The only unnecessary expense would be if they were to go over budget through their work.

Information Minister3496d ago

@ jbomber: I'm not saying that you're wrong, but you are contradicting the article. The security firms that were brought in, as well any other cost on Sony's end (such as the new server infrastructure) are not factored in, or even mentioned.

According to the author: "Keep in mind that this figure does not include the national investigation agencies involved such as Homeland Security or the FBI. That total, Spafford guesstimates at around an addition $100 million." That is in addition to the $24 billion which allegedly will already fall on tax payers.

So, let's establish that there are indeed $100 million to be paid by the common citizen. The question remains: what about the other $24 billion? Where do they go?

jbomber3496d ago

@Information mister -- The article and Spafford say that the $21 billion covers Sony's investigations. That cost does not include the *national organizations,* which is where the $100 million comes into play.

$21 billion for Sony's costs = consumers.
$100 million includes everything else. Roughly.

Of course, it is important to keep in mind that this is all hypothetical. As Spafford himself says, these are all estimates because really, this sort of information is very difficult to quantify. BUT, the potential is certainly there, and not wildly outside the realm of possibility.

moparful993496d ago

So it costs 21 billion dollars to do a 1 week investigation?? Really? Give me a freaking break first of all if you're going to throw sony under the bus for the potential of tax payer dollars being utilized in this investigation why not call out the all of the unnecessary spending that takes place within our government.. HEaven forbid our money actually be used to protect us.. But its ok if joe schmoe senator takes a 3 week vacation in paraguay that costs us several hundred thousand dollars...... People seriously love to hate sony why is that? Is it because they are the best at what they do? I think so....

+ Show (5) more repliesLast reply 3496d ago
frelyler3496d ago

There is nothing to read, it clearly says 100 million as a base number for the leak, which is bull, what are they fox news.

3496d ago
frelyler3496d ago

I'll say it every time, why the disagrees? You are entitled to your opinion of course, but if you cannot articulate an argument and just click a box I consider you a monkey and everyone knows monkey's opinions don't count.

rob60213496d ago

If the government was going to be billed so heavily after this attack, I don't see why they wern't there the moment Anon declared their attack on Sony; to prevent something like this from happening and jail these guys.

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Tired3496d ago (Edited 3496d ago )

WTF?

This has cost me NOTHING!

My bank said no point in getting a new card, I can moniter my own credit...as most should do.

This is crap!

2 disagrees?

It really has cost me nothing

EVERYBODY SHOULD MONITOR THEIR CREDIT!

blackburn53496d ago (Edited 3496d ago )

That's the part I don't understand. What are they talking about? This hasn't cost me a thing.

gamingdroid3496d ago

Are you a tax payer?

Did the government get involved? Are there any costs involved?

Who pays for it?

Because you don't personally pay for it doesn't mean somebody isn't paying for it. It's like food stampes, it is free to the people receiving it, but paid for by tax payers. You know, the people that work!

nycredude3496d ago

Gamingdroid

So if this never happened does that mean I don't have to pay taxes? give me a break there are only two things guaranteed in life, death and taxes. you have to pay taxes no matter what happens. They didn't all of a sudden hire more fbi people to investigate this. You haters aren't too bright. the fbi are there and it's part of their job to investigate this sort of thing and protect the citizens of the US from online fraud. it's partly their jurisdiction.

But all this is besides the point. Can you explain to me how Sony being the victim of an organized, planned online intrusion is Sony's fault?

Our tax payers money is used for alot of BS, but this isn't one of them. Putting these online terrorist in jail will better for everyone, not just Sony.

gamingdroid3496d ago

So because you are paying taxes regardless, we should just all get a check from the government. How does a $1000 sound?

That reasoning is naive. There is a cost to everything, even free things and if it is a cost that the government bears, it is the people that pay in increased taxes when the budget has a shortfall.

It's pretty simple, nothing comes out of thin air, and if something is there, somebody must have put it there!

GodsHand3496d ago

Do you monitor your credit report for free???

If you do, then that a one time deal for the entire year. If you have access to it everyday, then you are paying something for it.

My credit card company said the same thing, guess what I said, send me a new card. I rather no go threw the headache of fighting a dispute. If you ever had a dispute with a card company, all they do is freeze that transaction from gaining intrest, and investigate, and it does not get resolved in a day. Better safe they sorry, that's why I requested a new card.

If it does not cost you anything, it's because you are not a paying your taxes. One reason may be because you are under age to work, and can not contribute to Uncle Sam, or you do not realise that when you buy something you had to pay a tax to the store, and they intern had it over to Uncle Sam. Reason 2 might be because of all the taxes Uncle Sam collects, does not equal to what has been spent, so Uncle Sam decides to borrow against future tax collections from it's citizens, and in a sence you have not paid that money yet.

btw, I did not agree with you, or against you.

Tired3496d ago (Edited 3496d ago )

I am a British citizen. I don't pay my taxes to anyones 'uncle'

I'm also 32 years old so please drop the condecending tone.

Your paragraph about taxes makes little to no sense could you please rephrase it...perhaps to make a point.

MY taxes go towards the national health service, education and much more. Perhaps uncle sam should spend a little more time looking after its citizens instead of spending it on political theatre.

I fail to see how this could possibly cost $241 dollars per capita.

Yes I have had trouble with my credit card in the past, It was resolved the same day.

Perhaps you should not only change your credit card but also your credit provider. Mine have been nothing but helpful and efficient.

Yes I do pay for monitering of my credit...£3 per month. I do this not only for piece of mind, but because in this day and age it is something we all should do.

In fact I don't know a single responsible person who doesn't do this.

GodsHand3496d ago

The point is you do not understand what are taxes, and how they work. I guess the Brits, get to chose where their taxes go and how much, but then again I doubt that, because of the recent media of people protesting about having to pay for school, boo-who.

My apologies, for automatically thinking you were one of Uncle Sams citizens, all hail queen and country.

I also find it hard to belive you CC company resolved a dispute in one day, unless they only have 5 customers, and/or they relized it was a mistake on their part.

$241 per person seems decent, it's not like it only pays for one thing, It has to be divied up between personal, fuel, food, logging, research data, etc.

Taxes:

Citizen make money: $4,000/month before taxes.

State or Country demands it's fair share of 'X'%

State or Country get's every citizen collected taxes and distributes it to various projects.

Ex. of tax money being spent.
Military/Police - for protection.
Utilities - for running water, and not having to be swiming in our own feces.
Hospitals - for getting medical attention, because what good are dead citizens, if they can not contribute taxes. (companies do profit from you death)
Schools - for getting an education, and hopefully become productive in society.
Transportation - for having good roads to travel on, and bridges to carry traffic across rivers, and valleys.

I for one do not get to choose how much I pay or were it is being spent.

So if a goverenment collected $4 Billion dollars, and they want to fund all of these services, that's where it gets spent, and divied. But if the total bill is $8 Billion, the government will borrow money for it, against future taxes it will collect to pay the difference, not only that the borrowed money is now accumulating intrest, so when the future taxes are collected, they still have to collect even more (possible/most likely from your childern). Wow this is starting to sound like a bank who issues credit, for those buy now, pay latter with intrest.

Tired3496d ago

Wow How many shades of stupid ARE you?

I get the feeling I'm arguing with a twelve yr old.

I am well aware of what taxes are and how they work.

I dont for one second believe that you are a taxpayer. Otherwise you would not have posted something as stupid as.

'$241 per person seems decent, it's not like it only pays for one thing, It has to be divied up between personal, fuel, food, logging, research data, etc.'

NO IT IS FOR ONE THING. It's the cost per capita according to congress that it'll take to clean up sony's breach.

You appear to be proclaiming that Americans only pay £241 tax. Wow I pay thousands!

Why are you trying to argue about taxes...that was never the point.

All I have been trying to point out is the fact that the figure congress has plucked out of thin air is laughable.

I have four accounts, my partner also a ps3 user has 4 accounts, my nephew has 4 accounts, my friends...some have more.

That 21 billion dwindles for every person that has multiple accounts....no-one will have to pay a penny for them to clear up anything.

Many of them dont live in the us...they'll never have to pay a penny for any non-us citizens.

I called b.s on congress you cretin.

And the reason this has not cost me anything is as follows...

As for myself, No details were taken, my name is not mine, my birthday is one digit out on each entry.

yes my card details were inputted....they were encrypted and i'm covered regardless.
to activate my card I entered my address, once card varification occured, i changed my address.

Is this not standard practice to everyone.

No-one has my details because i'm not stupid enough. No-one can steal the identity of someone fictional.

The data breach of my info will cost...

Me...nothing

Sony...nothing

My government...Nothing

Your government...Nothing.

gamingdroid3496d ago

Good for you! What about other people?

There are many people whom did put in their credit card information and put in real information. Because you didn't cost anyone due to the breach, doesn't mean others did NOT!

The cost is passed along somewhere, because clearly there is a cost! If it is borne by Sony, it is covered by shareholders and customers. If it is borne by the government it is covered by taxes. One way or the other, it is paid by someone. You can't cover that up.

If the figure is inflated? Most likely, because the number of credit card numbers lost is significantly less than 77 million as well as the risk of them being decrypted. Cards still have to be replaced though? If you ever fight a credit card fraud, it is a b!tch and takes 60-days while the credit card company research it. In the meanwhile, the company might inconvenience you more asking for more proof. If they think it is your fault, it is your charge!

Also $250 per incident isn't exactly a lot when you take everything into account especially when it comes to the government.

moparful993496d ago

@gamingdroid Im sorry but you are wrong man.. First of all this so called "Expert" that this article is refering too throws out a figure of 21 million based off of 100 million psn accounts.. Sony themselves have publicly announced that they have no where near that many registered psn accounts..

Whats more how is it that it costs 241 per account? Where does this figure come from? Ohhh yea thats right this figure comes from an average based on previous intrusions THAT INCLUDED ACTUAL FRAUD.. There has been no reports of any form of fraud in connection with these intrusions.. So there is no financial loss incured by customers which means nothing that needs to be refunded or reclaimed...

TO take this rabbit hole even deeper how is it that US taxpayers have to pay? Sony is a multinational corporation and this intrusion includes accounts from around the world so how is it that the us taxpayer has to pay anything to begin with???

In my honest opinion this is just a case of these so called experts looking for someone to martyr in the cause of their field of expertise.. Having a visible "whiping boy" to gain attention and govt' support for their cause is a tantalizing prospect so they naturally become overly dramatic about the situation and voila they have national exposure...

gamingdroid3496d ago

As previously stated, yes I do agree that the cost is inflated due to the number of incidents, not the actual figure per incident.

That said, the cost among other things is in investigating consumer complaints, investigate Sony's wrongdoings (if any) and so on...

If there is identity theft due to your birth date and address is in the wild also incurs a cost. Your birth date is obviously not something you can just change, so you are now at a higher risk of identity theft the rest of your life.

So it is plain ignorant to think there isn't cost involved. If there is money to be lost, there is cost in protecting and fixing the damage. Doesn't take a genius to figure that out.

+ Show (3) more repliesLast reply 3496d ago
BeOneWithTheGun3496d ago

Ha. If they can get something on my credit more power to them!

cogniveritas3496d ago

You know how everyone likes to talk about where their tax money goes. Well you will undoubtedly have some people making noise about their tax money going paying for the time of government employees to investigate some video games...

Or if you're a few generations older "I don't no pay taxes so my gub'ment can investigate some ol nintendo games!"...lol

C_Menz3496d ago

I would probably agree with guy if everyone had their CC details compromised and were all experiencing identity theft. However, that is not the case and there has been no evidence to prove that the hackers have stolen any money from people or actually have their CC details.

So unless they expect Sony to shell out billions for hackers breaking into their systems and stealing info you can easily find on facebook or even google then they are on something.

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