Iron Mountain's Immovable Shares

How bulletproof is your business? What if you totally blew a job for a major customer? What if your screwup was played out all over the papers and on TV? What if you could only explain it with "human error -- it happens" or somesuch? Would you lose the customer? Would you lose others?

In May a Boston company called Iron Mountain endured just such embarrassment. This leader in the storage and management of corporate records lost 40 backup data tapes entrusted to it by Time Warner (TWX ). The unencrypted tapes hold the names, Social Security numbers, and other personal information of some 600,000 past and present Time Warner employees. Oops. The tapes still have not turned up, and the U.S. Secret Service told me it continues to investigate. Uncomfortable as Iron Mountain may be in the spotlight, its shareholders barely suffered: The stock fell just 1% or so on the news. Although the lost tapes have not yet led to any evidence of identity theft or other misuse, rising public concern over invasions of privacy -- and the potential for legal liability to Iron Mountain -- make the stock market's muted response all the more surprising.