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Asia Buzz: We've Got Your Mail
Or, how do you say "Get it Right, Bill" in Swedish?
By ERIC ELLIS
September 2, 1999
Web posted at 9 p.m. Hong Kong time, 9 a.m. EDT
It was the WWW, right? The Web's Worst Weekend. After years of incessant hype about the Internet and how it's making all our lives better, we were served up a sharp reminder on Sunday that cyberspace can be a treacherous place. By "we", I mean you, me and Bill Gates.
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ASIA BUZZ
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If the world's richest man has a recurring nightmare, it must run along the lines of the weekend's events: At around midnight GMT last Sunday, a bunch of mischievous Swedish and American Net bandits known as Hackers Unite broke through the security system at Hotmail, Microsoft's free e-mail service. In probably the most serious such breach yet in the history of the Internet, they made the accounts of Hotmail's 40 million subscribers--a staggering 20% of the Web's user base--vulnerable to prying eyes everywhere.
These guys obviously don't remember what Mother said about reading other people's mail.
What's really scary about the Hotmail breach is how simple it was. All Hackers Unite needed was nine lines of code, which some users claim had been around on the Web in various forms for two months. They put it together, then broadcast the code across the Internet. For 12 hours, until Microsoft plugged the breach, the code spread like wildfire all over the Web, transmitted by mass e-mailings and posted on numerous websites. Once you had the code, all you needed to break into a Hotmail account was the user name. And user names are easily obtained because they form part of every Hotmail address.
In one stroke, Hotmail's genius, its simplicity, had become its greatest weakness.
Microsoft may have repaired the technical flaw, but the damage to its reputation will be much harder to fix. The Hotmail breach plays to the growing perception that Microsoft is less a technology giant than a ruthless marketing machine that sells buggy software. "We did not do this hack to destroy anything," says Lasse Ljung, one of the Hackers Unite gang. "We wanted to show the world how bad the security on Microsoft really is."
Call it the price of fame. When you're the most powerful Internet player, you're automatically a target. Says Jordan Worth, a Net analyst with International Data Corp: "Microsoft is clearly in the crosshairs of the hackers."
In will be interesting to see what the Web-obsessed stockmarkets make of the episode. Until now, Hotmail has been regarded as Microsoft's best Internet investment. In 1997, Gates paid a company owned by Indian engineer Sabeer Bhatia $400 million in stock for the world's most popular freemail system. Today, by the market's per-user valuation prescribed to Net communities, Hotmail is estimated to be worth $6 billion. But Hotmail's value to Microsoft, famously late to the Internet party, is probably incalculable. The service is a key part of Microsoft's Internet strategy and has helped the company overcome the enormous leg-up rival Netscape got by being first with a Web browser.
While Microsoft works out how to reassure Hotmail users that their mail will henceforth be safe from snoopers, other Web-based businesses should take a long, hard look at their security systems. Who knows where Hackers Unite might strike next? Maybe in YOUR webmail in-tray.
TIME Asia home
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