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Sony network breach to cost company $170 million

sony_logo_1Facts continue to emerge in the aftermath of the service outage that took Sony‘s PlayStation Network, Qriocity and Sony Online Entertainment services offline for a month following the April security breach that led to the personal data theft of more than 100 million registered users. The latest concerns the material cost to the company, which as you might imagine is considerable. In addition to the impact the downtime had on income forecasts, there’s also the post-service restoration clean-up that Sony needs to deal with, such as offering all affected users one full year of identity theft protection.

The company expects the cost of the service outage to rise to roughly $170 million by the end of the 2012 fiscal year, a fact revealed in an update to investors yesterday (via “Based on information currently available to Sony, our current known costs associated with the unauthorised network access are estimated to be approximately [$170 million] in the fiscal year ending March 31, 2012,” a statement read.

That’s only the start though. Sony also expects a sizable net loss for 2011, to the tune of $3.1 billion. While the network breach factors in, the large part of those losses is accounted for by the March earthquake and resulting tsunami that rocked Japan. Previous expectations pointed to profits of roughly $850 million for fiscal 2011, but the natural disasters carry an expected cost of roughly $208 million for this year and a staggering $1.8 billion for fiscal 2012. Even still, Sony noted to investors that it expects to turn a profit next year.

All dollar values converted from the Japanese yen.

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