Sony restoring game network in Asia; to testify in U.S.

TOKYO/NEW YORK Fri May 27, 2011 3:47pm EDT

A man looks at Sony Corp's products at an electronics store in Tokyo May 26, 2011. REUTERS/Toru Hanai

A man looks at Sony Corp's products at an electronics store in Tokyo May 26, 2011.

Credit: Reuters/Toru Hanai

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TOKYO/NEW YORK (Reuters) - Sony Corp said it will start restoring its PlayStation videogame network in Japan and elsewhere in Asia on Saturday, more than a month after a massive security breach leaked personal details on tens of millions of accounts.

The Japanese electronics and entertainment giant also said on Friday it plans to testify before U.S. lawmakers at a hearing on data security in Washington on June 2 to address what is thought to be the biggest Internet security breach in history.

The company has been under fire since hackers accessed personal information on 77 million PlayStation Network and Qriocity accounts -- 90 percent of which are in North America and Europe -- and may have stolen credit card information.

Video game fans and security experts alike have criticized Sony for its handling of the incident, which sparked lawsuits and cast a shadow over its plans to combine the strengths of its content and hardware products via online services.

The company apologized to customers for the outage and said a range of new security measures had been introduced. These included a better early warning system that could alert the company about breaches.

In a new letter sent to U.S. lawmakers late on Thursday evening, Sony said it added more firewalls and introduced policy changes and thorough testing of its systems. But Sony warned the new measures might not be enough to fully secure its networks.

"No security system is absolutely foolproof, and changing conditions in the future can make a currently secure environment less secure," Sony said in the letter signed by Kazuo Hirai, the head of Sony Computer Entertainment, the company's games unit.

Japan's trade ministry ordered the games unit on Friday to adopt measures to improve the management and security of personal information, following the data breach.

"Considering the content and volume of information leaked, it is an extremely grave incident, and it is truly regrettable that it occurred and took a considerable time to notify users and the ministry," the ministry said in a statement.

Sony has said it will offer a new identity protection service to customers in Asia.

COUNTING COSTS

On Thursday, Sony said it was keeping to its target of restoring all PlayStation Network services by the end of May, with any delay beyond that not likely to be more than a few days.

It has said it expects the hacking to drag down operating profit by 14 billion yen ($172 million) in the current financial year, including costs for boosting security measures.

Sony shares fell 3.2 percent ahead of the announcement on the restart, with analysts concerned Sony's forecast for a $975 million net profit this business year may not meet expectations. Its ADR shares in the United States were down a little over 1 percent in early afternoon trading.

Some users have said the prolonged outage prompted them to switch to rival Microsoft Corp's Xbox Live games service.

The attack on Sony is the highest-profile of a series that have affected large corporations recently, fueling doubts about the security of cloud computing services.

Sony discovered unusual activity on its PlayStation Network, which enables games console owners to download games, chat with friends and pit their skills against rivals, on April 19.

It shut down the network and its Qriocity online music and movie service, frustrating many users, but waited almost a week before alerting users to the extent of the security leak.

The company later found out a separate online games service had also been penetrated, allowing access to another 25 million user accounts.

($1 = 81.345 Japanese Yen)

(Reporting by Isabel Reynolds and Liana B. Baker; writing by Anshuman Daga; editing by Lincoln Feast and Andre Grenon)

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