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Amazon.com Server Said to Have Been Used in Sony Attack

Amazon.com Inc. (AMZN)’s Web Services cloud- computing unit was used by hackers in last month’s attack against Sony Corp. (6758)’s online entertainment systems, according to a person with knowledge of the matter.

Hackers using an alias signed up to rent a server through Amazon’s EC2 service and launched the attack from there, said the person, who requested anonymity because the information is confidential. The account has been shut down, the person said.

The development sheds light on how hackers used the so- called cloud to carry out the second-biggest online theft of personal information to date. The incursion, which compromised the personal accounts of more than 100 million Sony customers, was “a very carefully planned, very professional, highly sophisticated criminal cyber attack,” Sony has said.

Drew Herdener, a spokesman for Seattle-based Amazon, declined to comment. Amazon didn’t respond to a request to speak with Chief Executive Officer Jeff Bezos.

“We’re continuing to work with law enforcement in an ongoing investigation into the situation,” said Patrick Seybold, a U.S. spokesman for Tokyo-based Sony. “As such, we will not comment further on this matter.”

The hackers didn’t break into the Amazon servers, the person said. Rather, they signed up for the service just as a legitimate company would, using fake information.

Even so, the role of Amazon Web Services is likely to call attention to concerns some businesses have voiced over the security of computing services delivered via others’ remote servers, referred to as cloud computing.

Cloud security is Amazon’s top priority, Bezos said at an event sponsored by Consumer Reports magazine this week.

Rented Servers

“Data security is one of these great dynamic situations where the bad guys get better, and the good guys have to keep getting better too -- it’s not a static situation,” Bezos said, Fast Company’s website reported. “I don’t think this is ever going away -- it’s like trying to say that you’re going to get crime to go away.”

The use of a hijacked or rented server to launch attacks is typical for sophisticated hackers. The proliferation of server farms around the globe has made such misdirection easier, said E.J. Hilbert, president of the security company Online Intelligence and a former FBI cyber-crime investigator.

The Federal Bureau of Investigation will likely subpoena Amazon as part of its investigation process, or it may try to obtain a search warrant, Hilbert said.

Tracing Activity

“The subpoena will give law enforcement a history of the transactions,” or who had access to the specific Internet address at that time, Hilbert said. “The search warrant will get them more detailed information, including payment information and which credit card was used.”

Herdener declined to say whether Amazon has been subpoenaed or served with a search warrant.

FBI Special Agent Darrell Foxworth, a spokesman for the agency’s San Diego office, said he couldn’t comment on whether the agency had served Amazon with a search warrant or subpoena.

“We are following up on each and every lead,” Foxworth said.

Amazon Web Services leases computing space to companies such as Netflix Inc. (NFLX) and Eli Lilly & Co. (LLY) so they don’t have to buy their own servers to store data and handle a surge in visitors. The unit brought in about $500 million in revenue in the past year, according to estimates from Barclays Capital and Lazard Capital Markets, or about 1.5 percent of Amazon’s $34.2 billion in 2010 sales. The company doesn’t disclose revenue from Web services.

Security Risk

Amazon fell $3.51, or 1.7 percent, to $202.56 yesterday in Nasdaq Stock Market trading. The shares have added 13 percent this year. Sony lost 23 yen to 2,241 yen in Tokyo and have slid 23 percent in 2011.

Sony offered customers a free year of identify-theft protection after its PlayStation Network and Qriocity entertainment networks were crippled by the attack. Thieves may have stolen credit-card, debit records and other personal information from customers of Sony Online Entertainment, a third service. The New York Attorney General’s office has subpoenaed Sony, according to a person familiar with the probe.

Network security breaches are part of a trend that saw the costs of such invasions jump 48 percent, to an average of $318 per compromised record last year, according to a March report by the Ponemon Institute.

Malicious attacks in the U.S. are on the rise. They climbed 7 percentage points in 2010, with data breaches costing U.S. businesses an average of $7.2 million per incident, according to the Ponemon Institute report. The study found that about 85 percent of all U.S. companies have experienced one or more attacks.

To contact the reporters on this story: Pavel Alpeyev in Tokyo at palpeyev@bloomberg.net; Joseph Galante in San Francisco at jgalante3@bloomberg.net; Mariko Yasu in Tokyo at myasu@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net; Tom Giles at tgiles5@bloomberg.net; Young-Sam Cho at ycho2@bloomberg.net

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