North Korea-linked Sony hack may be costliest in US history

Sony has cancelled the Christmas Day release of the film, citing threats of violence against movie theatres.
A poster for The Interview is taken down from display at a cinema in Atlanta, as planned screenings have been cancelled. AP Photo
A poster for The Interview is taken down from display at a cinema in Atlanta, as planned screenings have been cancelled. AP Photo

NEW YORK // North Korea has been linked to the unprecedented hack of Sony Pictures which drove the studio to cancel release of the movie The Interview, according to a US official.

The attack, which exposed a trove of sensitive documents and escalated to terrorism threats, is possibly the costliest ever for a US company, said Avivah Litan, a cybersecurity analyst at research firm Gartner.

“This attack went to the heart and core of Sony’s business and succeeded,” she said. “We haven’t seen any attack like this in the annals of US breach history.”

Federal investigators believe the isolated communist country is connected to the Sony hack, according to an official who spoke on condition of anonymity. North Korea has denounced the The Interview but earlier this month said the hack might have been carried out by sympathisers.

The movie is about journalists played by James Franco and Seth Rogen that are asked by the CIA to assassinate North Korean leader Kim Jong-un.

Sony on Wednesday cancelled the Christmas Day release of the film, citing threats of violence against movie theatres and decisions by the largest multiplex chains in North America to pull screenings.

The company said it has “no further release plans for the film” seemingly ruling out a delayed theatrical or video-on-demand release.

The cancellation was a startling blow to the Hollywood studio.

The hackers, who call themselves Guardians of Peace, on Tuesday threatened movie theatres with violence reminiscent of the September 11, 2001 attacks if they showed the film.

“We are deeply saddened at this brazen effort to suppress the distribution of a movie,” Sony Pictures said.

White House spokeswoman Bernadette Meehan said the US government had no involvement in Sony’s decision.

Sony faces trouble on several fronts after nearly four weeks since the hackers first crippled its computer systems and started dumping thousands of emails and private documents online.

In addition to vanishing box-office revenue from The Interview, leaked documents could disrupt production schedules, experts say. There will be the cost of defending the studio against lawsuits by ex-employees angry over leaked personal information, and actors who might decide to work at another studio.

Beyond the financial blow, some say the attack and Sony’s capitulation has raised troubling questions about self-censorship and whether other studios and US companies are now also vulnerable.

“Artistic freedom is at risk,” said Efraim Levy, a senior financial analyst at research firm S&P Capital IQ.

“Are we not going to put out movies that offend some constituencies?”

* Associated Press

Published: December 18, 2014 04:00 AM

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