eBay Database Under Cyber Attack - Analyst Blog

Cyber attack has become one of the most common crimes in the recent times. E-Commerce giant eBay Inc. EBAY recently disclosed that one of its corporate information networks suffered a cyber attack.

eBay revealed that unknown perpetrators infiltrated a database gaining unauthorized access to its corporate network.

The breached database contained personal information, including customers' names, encrypted passwords, telephone numbers, physical addresses and date of birth. The company, however, clearly stated that no financial information regarding its customers, such as credit card numbers, was stolen.

Also, personal as well as financial information related to PayPal users, stored in an encrypted format on a separate network, were safe.

In response to the breach, eBay has advised its users to change their passwords to ensure security. However, the recent breach has not only put current cyber security solutions under the scanner, but also the habit of using a simplistic password that can be easily guessed.

The news comes on the heels of several high-profile data breaches, including the one at Target Corp. TGT affecting 110 million customers during the holiday season of 2013. According to EMC Corp's EMC RSA division, apart from Target and Neiman Marcus Group Ltd., data of at least 41 retail companies were compromised and debit and credit card details of approximately 50K customers were stolen during the same period.

According to Intel's INTC McAfee lab, cyber attacks will increase manifolds in 2014 compared with 2013 and 2012. We believe that strict vigilance from all sectors is the need of the hour. Efforts to improve coordination within the private sector are also increasing. Additionally, training and education on security matters are equally important to develop a preventive mechanism against such attacks.

Amid the growing number of cyber attacks, corporations and companies are looking for stricter and more stringent cyber security measures to plug the loopholes in the system. While new security solutions may not be a permanent answer to the problem, it will serve as the first step to solve this complex problem.

Currently, eBay has a Zacks Rank #3 (Hold).