Have LinkedIn's Security Problems Permanently Damaged the Social Network?

Sharon Gaudin June 15, 2012
Have LinkedIn's Security Problems Permanently Damaged the Social Network?
Security breach grabs headlines, but will users pack up and leave?

After hackers last week breached the LinkedIn site, stealing more than 6 million user passwords, analysts are debating whether the attack will cause long-term damage to the social network.

In the attack, users' passwords were posted publicly to a Russian hacker forum. The incident garnered a lot of headlines, both in the trade and mainstream news media, and LinkedIn was accused of using lax security and having nothing more than light encryption to safeguard its users data.

Many companies, including LinkedIn suffer security breaches. What's causing the furor over the LinkedIn breach is that the company makes its name and its money from user data, yet it failed to take what security experts would call adequate steps to secure its bread and butter.

Critics accuse the company of failing to protect its users. Will users stand by their social network or will they flee?

"This is a business site focused on business users who generally don't take well to negligence, particularly when it comes to their passwords and IDs," said Rob Enderle, an analyst with the Enderle Group. "I think this attack will do lasting damage and open the door for competition. But I don't see a competitive choice positioning against the opportunity though, so LinkedIn may do better than they otherwise would as a result."

While LinkedIn's security lapse could drive users away, users of social networks have proved to be immensely loyal and willing to take hits without leaving their favorite sites.

Facebook, for instance, has had a handful of highly publicized privacy issues that drew heated criticism from its users. Industry analysts predicted an exodus of unhappy users. While some dribbled off the site in frustration, there was never a mass exodus.

Social networking users may get frustrated and angry and post nasty tweets on Twitter, but they want to be where their friends are. They want to see their cousin's news and their college roommate's vacation pictures. They rarely leave.