Sources: Security not priority for Yahoo
Insiders say company chose to focus on new products instead.
Six years ago, Yahoo’s computer systems and customer email accounts were penetrated by Chinese military hackers. Google and a number of other technology companies were also hit.
Google co-founder Sergey Brin responded by making security a top corporate priority. Google hired hundreds of security engineers with six-figure signing bonuses, invested hundreds of millions of dollars in security infrastructure and adopted a new internal motto, “Never again,” to signal that it would never again allow anyone — be they spies or criminals — to hack into Google customers’ accounts.
Yahoo, on the other hand, was slower to invest in the kinds of defenses necessary that are now considered standard in Silicon Valley to thwart sophisticated hackers, according to half a dozen current and former company employees who participated in security discussions but agreed to describe them only on the condition of anonymity.
When Marissa Mayer took over as chief executive of the flailing company in mid-2012, security was one of many problems she inherited. With so many competing priorities, she emphasized creating a cleaner look for services like Yahoo Mail and developing new products over making security improvements, the Yahoo employees said.
The “Paranoids,” the internal name for Yahoo’s security team, often clashed with other parts of the business over security costs. And their requests were often overridden because of concerns that the inconvenience of added protection would make people stop using the company’s products.
But Yahoo’s choices had consequences, resulting in a series of embarrassing security failures over the past four years. Last week, the company disclosed that hackers backed by what it believed was an unnamed foreign government stole the credentials of 500 million users in a breach that went undetected for two years. It was the biggest known intrusion into one company’s network, and the episode is now under investigation by both Yahoo and the FBI.
Certainly, many big companies have struggled with cyberattacks in recent years. But Yahoo’s security efforts appear to have fallen short, in particular, when compared with those of banks and other big tech companies.
To make computer systems more secure, a company often has to make its products slower and more difficult to use. It was a tradeoff Yahoo’s leadership was often unwilling to make.
In defense of Yahoo’s security, a company spokeswoman, Suzanne Philion, said that the company spent $10 million on encryption technology in early 2014, and that its investment in security initiatives will have increased by 60 percent from 2015 to 2016.
“At Yahoo, we have a deep understanding of the threats facing our users and continuously strive to stay ahead of these threats to keep our users and our platforms secure,” she said.
The breach disclosed last week is the latest black eye for Mayer, whose failed turnaround effort resulted in Yahoo’s agreement in July to sell its core operations to Verizon for $4.8 billion. It is unclear whether the episode will affect the sale. Although Yahoo’s email users are its most loyal and frequent customers, the company has been losing market share in email for years.
Mayer arrived at Yahoo about two years after the company was hit by the Chinese military hackers. While Google’s response was public, Yahoo never publicly admitted that it had also been attacked.
In 2013, disclosures by Edward Snowden, the former National Security Agency contractor, showed that Yahoo was a frequent target for nation-state spies. Yet it took a year after Snowden’s initial disclosures for Yahoo to hire a new chief information security officer, Alex Stamos.
Jeff Bonforte, the Yahoo senior vice president who oversees its email and messaging services, said in an interview in December that Stamos and his team had pressed for Yahoo to adopt end-to-end encryption for everything. Such encryption would mean that only the parties in a conversation could see what was being said, with even Yahoo unable to read it.
Bonforte said he resisted the request because it would have hurt Yahoo’s ability to index and search message data to provide new user services.
“I’m not particularly thrilled with building an apartment building which has the biggest bars on every window,” he said.