Hacking pain goes beyond movie leaks
NEW YORK — Piracy is a longrunning and even routine issue for Hollywood, whether it’s street vendors hawking bootleg DVDS on street corners or video uploaded to file-sharing sites like Pirate Bay. Now cybercriminals are also putting embarrassing chatter and other company secrets at risk.
The danger that leaked email poses to a company’s reputation is much more difficult to calculate than any financial fallout from piracy. “In some ways, that risk can be higher because you have no way of knowing what’s in those emails,” said Erik Rasmussen of Kroll Cyber Security.
The cataclysmic event in the back of everyone’s mind is the 2014 Sony hack. While unreleased movies were leaked, what’s remembered is the chaos unleashed amid a network shutdown and the disclosure of derisive comments about such well-known actors as Angelina Jolie and Leonardo Dicaprio and racially insensitive remarks about thenPresident Barack Obama.
Although the recent HBO leaks so far have fallen well short of the damage inflicted on Sony, there were concerns early on that hackers were setting the stage for an embarrassing sequel for Hollywood.
Piracy still a problem
While leaked emails get more attention, that’s not to say Hollywood isn’t worried about piracy.
In online forums where criminals “advertise their ill-gotten gains,” there is now entertainment content “popping up as basically sections of these websites,” Rasmussen said.
Some people think video leaks can help gin up media and viewer attention for a show or movie, but leaking shows and movies does hurt Hollywood’s take, especially if it happens before the official release, Carnegie Mellon professor Michael Smith said.
In a 2014 analysis, Smith and his co-authors concluded that a movie’s box-office revenue dropped 19 percent, on average, when it was leaked ahead of the theatrical release, compared with a leak after the movie hit theaters. The research was part of a Carnegie Mellon initiative funded by the Motion Picture Association of America, Hollywood’s lobbying group.
One way to overcome pirates is to make programs widely and cheaply available. Netflix has many shows and movies that are easily accessible around the world for a single monthly price. In April, hackers leaked most new episodes of Netflix’s “Orange Is the New Black” before their official release in early June. That doesn’t seem to have driven customers away. Netflix added more than 5 million subscribers in the April-to-june period, the largest increase ever for that quarter.
Separate from HBO’S recent run-ins with hackers, upcoming “Game of Thrones” episodes have been leaked several times, and it is TV’S most pirated show. “Game of Thrones” is still a massive hit for HBO, with high viewership and critical acclaim. As for the recent hacks, episodes of “Curb Your Enthusiasm,” “Insecure,” “Ballers” and several other shows also were leaked.
It helped that entire seasons weren’t released, forcing viewers to subscribe to view the whole show.
The fallout at HBO
HBO’S hackers demanded a multimillion dollar ransom, something HBO refused.
Because piracy is prevalent, the leak of several scattered TV episodes might not have been enough to force such a payment, said Alex Heid, chief research officer at risk management firm Securityscorecard. “Pirated content ends up on Pirate Bay within 24 hours of airing. Any show on HBO, any movie, the moment it’s released, on the first day, you see it on pirated internet streams.”
But hackers released an email from HBO in which the company expressed willingness to pay them $250,000 as part of a negotiation over data swiped from HBO’S servers. Whether or not HBO ever intended to follow through with the offer, the email raised questions among security professionals about the importance of the data.
Besides upcoming episodes, the HBO data dumps included what appeared to be contact information of Hollywood actors , a month’s worth of emails of one employee, sensitive internal documents like job offer letters and scripts for future episodes.
A person familiar with the situation, speaking on condition of anonymity, said HBO was proactive in communicating with actors ahead of their personal information being released to the public. That may be helping mitigate the impact of what leaks did occur.
Companies that do get hacked should be up front with customers, employees and other affected parties as soon as possible, said Richard Levick, the head of crisismanagement firm Levick. “You can’t sweep it under the rug,” he said.
“You can’t be opaque about it.”