The Scoop: Microsoft had ‘cascade of errors’ that led to hack, government says

A series of major mistakes was dubbed “a cascade of errors” which led to a Chinese hack of Microsoft, according to a U.S. government review. CNN reports that the infiltration included a breach of the tech giant’s internal networks and the emails of several senior officials within the organization.

“Microsoft’s security culture was inadequate and requires an overhaul” in light of the company’s “centrality in the technology ecosystem,” a report from the US Cyber Safety Review Board. The report keyed in on a weakness in Microsoft’s security protocols that allowed hackers to sign into the Outlook accounts of targets remotely.

The hackers also managed to break into the email account of Secretary of Commerce Gina Raimondo before a trip to China last year.

Microsoft responded with some snark in response, effectively stating that the company is doing its best to fight off cyber-attackers, but that the bad actors out there don’t have much in the way to stop them, a not-so-subtle swipe at the government’s own ability to protect American interests from cyber-threats.

“We appreciate the work of the [Cyber Safety Review Board] to investigate the impact of well-resourced nation-state threat actors who operate continuously and without meaningful deterrence,” a Microsoft spokesperson said in a statement to CNN.

“Our security engineers continue to harden all our systems against attack and implement even more robust sensors and logs to help us detect and repel the cyber-armies of our adversaries.”

Why it matters: Beyond the not-so-ideal optics for Microsoft here, this news should serve as a reckoning point for any organization’s approach to security. If you think your approach is ironclad while Microsoft is getting hacked from half a world away, it might be time to reconsider how you protect your data and valuable information. From a PR perspective, it’s worth having a crisis plan in place to react to potential breaches or security issues in the public form. That can take the form of tabletop training exercises, content templates, and more. Preparation is half the battle.

But it’s also notable to look at Microsoft’s response to the US Cyber Safety Review Board’s harsh statements. Microsoft’s statement was pretty biting, and it’s worth wondering if such a response might encourage others in the tech space to either turn up the pressure on the government to do more to protect American interests from cybersecurity threats or lead companies to harden their protections in the absence of government security upgrades. Sometimes a tonal shift in the PR world can lead to real impacts in the long run.

Editor’s Top Reads

• Artifact, the AI-powered news recommendation tool, has a new home. The tech, developed by Instagram’s founders, was acquired by Yahoo earlier this week, according to The Verge. While Artifact wasn’t able to get to scalability on its own, the Yahoo acquisition will help it get in front of millions of readers. Co-founder Kevin Systrom also told The Verge that despite the app’s previous struggles, there was always faith that people would care about news. “A lot of organizations care deeply about news and personalized content,” he says, “and I think they’re looking around and saying ‘Wow, there’s this new wave of AI… maybe we should figure out what’s going on.’ Maybe that’s what I discounted originally.” In an ever-shifting landscape of news media, this could be a development to keep an eye on down the road.
• This Sunday’s Iowa-LSU women’s basketball game wasn’t just a great event on the court. The battle of basketball giants and showcase of stars Caitlin Clark and Angel Reese also led to a windfall in the gambling world as well. According to a report by CNBC, the game was the most bet-on event in the history of women’s sports. “We have seen an incredible uptick in betting on women’s sports as fans show unprecedented interest, and we look forward to seeing how fans engage during the Final Four,” Karol Corcoran, senior vice president and general manager of FanDuel Sportsbook, said in an email. If it wasn’t already apparent, women’s sports are here to stay and more popular than ever — they’re even changing the way we talk about and consume sporting events. An equal playing field for men’s and women’s sports is undoubtedly a good thing. The fact that people are willing to wager big money on a women’s game, despite the drawbacks that come with gambling, is a sure sign that the conversation around women’s sports has changed and people are tuning in in droves. Clark is already a major influencer with brands like State Farm as part of her endorsement portfolio. When she goes pro later this year, will gaming platforms follow her and other female athletes? It’ll be interesting to see.
• When you mention Tesla, you’re bound to hear a lot of opinions on the electric cars, both positive and negative. But one thing that doesn’t lie is numbers, and Tesla’s aren’t great so far in 2024. According to a report from New York Magazine’s Intelligencer, Tesla delivered 386,000 vehicles in the first three months of 2024, a 15% shortfall from Wall Street projections. While Tesla’s declining sales can be attributed to several factors, it’s fair to wonder how much the behavior of the man at the top, Elon Musk, has to do with it. One of the most polarizing public figures, the South African-born billionaire is a well-known pot-stirrer and magnet of controversy. From his messy takeover of Twitter that culminated in its rebrand as X to his not-so-subtle flirtations with the ideas of the alt-right, Musk commands headlines, and not always for the best reasons. Is his behavior part of the reason Tesla sales are down, with people not wanting to associate with a brand so tied to him? It’s a cautionary tale about the risks of having a brand so tightly bound up in the vision of a single person.

Sean Devlin is an editor at Ragan Communications. In his spare time he enjoys Philly sports and hosting trivia.