Five Companies That Dropped The Ball This Week

Sony Playstation Hack Conjures Memories Of Rootkit Fiasco

Sony this week warned of identity theft scams in the wake of last week's attack on PlayStation Network and Qriocity services, which compromised more than 70 million login credentials. The stolen information from the PlayStation hack included user names, passwords, online IDs, customer addresses, e-mail addresses, and birth dates, although Sony says it encrypted customers' credit card data.

It's Sony's biggest emergency since November 2005, when independent researcher Mark Russinovich reported that Sony was using a rootkit to hide DRM software on PCs that played the company's CDs. Problem was, users hadn't been informed that the rootkit had been installed.

While the PlayStation hack wasn't as egregious a miscue, it's still keeping Sony in the news for unpleasant reasons.

Amazon Cloud Outage Fallout

Amazon Web Services Elastic Compute Cloud (EC2) and Relational Database Service (EDS) suffered service interruptions and downtime starting early Thursday morning last week, wreaking havoc on many customers, including several up-and-coming Web 2.0 sites. Sporadic Amazon cloud outages continued over the weekend, and this week it came to light that some customers' data may have been permanently destroyed.

Solution providers called the EC2 outage a "cautionary tale", and Amazon can certainly learn a boatload of lessons from the incident, but permanent data loss is not something a company recovers from quickly.

RIM Lowers Q1 Outlook Due To Weak Smartphone Sales

Research In Motion has been turning in weak results in its past several quarters, so no one was that surprised when the company acknowledged its struggles by slashing its outlook due to weak smartphone sales. RIM cut its profit forecast for the current quarter by 11 percent this week, and coincidentally, its shares also dropped 11 percent in the hours after the announcement.

Couple RIM's financial struggles with all of the Playbook bashing that's been going on, and the fact that both RIM co-CEOs apparently don't like being asked tough questions by industry watchers, and you've got a situation that looks pretty grim.

Verizon's 4G LTE Network Goes Down For A Day

Verizon Wireless's 4G LTE network was hit with an outage this week that rendered the service unusable for the better part of a day, according to reports. It's the first major glitch Verizon has run into since launching its 4G network late last year. Given the massive amount of marketing that Verizon has been doing around its 4G service, the incident could give pause to would-be customers.

TomTom Cops To Sharing Users' Traffic Data -- With Cops

GPS device maker TomTom, in an apparent attempt to pre-empt investigation into its location data sharing policies, this week admitted that it shares traffic data collected from users with police departments.

"We are actively promoting the use of this information because we believe we can help make roads safer and less congested," TomTom CEO Harold Goddijn said in a blog post. "We are now aware that the police have used traffic information that you have helped to create to place speed cameras at dangerous locations where the average speed is higher than the legally allowed speed limit."

Goddijn said TomTom is evaluating whether to continue the practice. Kudos for being upfront and all, but perhaps users should have been made aware of this beforehand?