Corrects the fact T-Mobile service applicants were also affected, not just T-Mobile customers.
NEW YORK (The Street) -- While T-Mobile's (TMUS) CEO John Legere believes that "part of being the Un-carrier means telling it like it is," Mr. Legere has a problem on his hands that defies easy answers, not to mention solutions.
That said, despite Legere's publicly expressed frustration via public statements so far, "angry" hardly covers the full implications of this latest corporate hack. The recent announcement that a data breach at financial credit processing firm Experian affects at least 15 million T-Mobile USA customers and service applicants is just the start of it.
"Citizens - not just consumers - are at the heart of this and what happens next. In some ways this is going to be about customer relations on a level with a company like Volkswagen AG (VLKAY) - they have to get it right," according to Robin Speakman, a research analyst at Shaw Capital - an independent securities firm. "Senators have now written to Experian asking for more information about what happened."
In terms of what Experian is doing in the short term, the global financial services firm announced on its website that it had notified appropriate law enforcement agencies upon discovery of the breach. It is also offering those impacted by the break-in two years of free credit monitoring and identity theft resolution services.
A data breach of a company like Experian pales in comparison to an otherwise "normal" corporate hack. It is one of the three major American credit bureaus - which also includes Equifax (EFX) and TransUnion (TRU) - that affect if not touch every American with a credit card, cell phone or potentially social security number.
As a result, a hack at one of such companies leaves the door wide open for much larger scale hacks with a bigger impact long after the fuss over this incident is over. Some industry watchers, like the IT focused Inquirer claimed the information was already for sale on the first weekend after the hack on the dark web, a collection of websites that are publicly visible, yet hide the IP addresses of the servers that run them.
The impact to consumers is far more complex than it might appear, despite efforts by T-Mobile at least to downplay concerns about the impact of the breach. According to a T-Mobile spokesperson reached this afternoon by TheStreet, "This incident took place in one of our USA business units, and it's important to note this was not the consumer credit bureau. The incident was solely contained to the US and we've provided guidance to T-Mobile USA customers as you'll see from our statement and from this link, we're encouraging people to view."