Sony's Playstation waiting game

A man plays on a PS3 games console on October 27, 2010 in Paris during the first edition of the 'Paris Games week' event to be held until October 31, 2010.

Kai Ryssdal: Here's today's quiz from the Marketplace Desk of Situational Ethics. Which do you suppose is worse: The fact that hackers managed to steal personal data from 77 million online accounts attached to its PlayStation network, or that Sony took almost a week to let those 77 million people know that hackers had stolen personal data from their PlayStation accounts?

The company did shut the network down a week ago, but why the delay in telling people about? Marketplace's Nancy Marshall Genzer has the story.


Nancy Marshall Genzer: Sony may have a lot of reasons for not telling gamers about the data breach right away. Maybe the extent of it wasn't clear, or Sony didn't want to cause widespread panic. But, intentionally or not, delaying the bad news may have saved Sony money. Research from a tech think tank shows companies that respond quickly spend 54 percent more cleaning up their PR messes. Tim Matthews is with Symantec, which sponsored the study.

Tim Matthews: If organizations respond too quickly and actually notify people who in fact were not affected, customers are equally likely to get upset about it and then take their business elsewhere.

Josh Shaul did a double take when he read the Symantec study. Shaul is with Application Security, which makes database security software. But he says, when you think about it, delaying the bad news makes sense.

Josh Shaul: Having to go out with a message like 'all your credit card data may have been lost, we really don't know,' is pretty painful, particularly if in the end, that credit card data was never accessed.

So delay can pay. But is that why Sony waited so long to break the bad news? Danny Sullivan doesn't think so. He edits searchengineland.com.

Danny Sullivan: To think, well if we wait a week, we'll save money. Do you wait two weeks and save more money? It's so complicated, I just don't see how they would have calculated that sort of thing.

Sullivan thinks Sony upset more people by waiting. Sony officials haven't had much to say. And they didn't respond to my numerous requests for comment.

In Washington, I'm Nancy Marshall Genzer for Marketplace.

About the author

Nancy Marshall-Genzer is a senior reporter for Marketplace based in Washington, D.C. covering daily news.

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