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The Yahoo Event that Wasn't

Data breach appears to have had little impact on usage

In another sign that internet users remain fundamentally unconcerned about privacy and security online, Yahoo reported that usage of the network dipped only briefly after its disclosure of a significant data breach in December.

The usage was reported as the company released fourth-quarter earnings. Yahoo reported that its revenue increased by 15.4%, reaching $1.47 billion. But revenue was affected by a new accounting requirement. Were the accounting change discounted, revenue would have fallen 8% in the quarter. Meanwhile, the company said the closing of its expected acquisition by Verizon has been delayed until Q2. It did not give a specific reason for the later date.

Yahoo said that the security breach, which compromised more than 1 billion user accounts, appeared to have had little effect on usage. The breach, which was disclosed in mid-December, was followed by a slight fall-off in pageviews and emails sent and read, but those declines were in line with the seasonal fall-off seen a year earlier, Yahoo said.

Traffic on Yahoo's so-called core verticals (homepage, news, sports, finance and lifestyles pages) continued to trail year-earlier results after the holiday dip, but the company said that was more a function of major news events in the year-earlier period.

The impact of the breach is in line with previous security lapses at other companies, both online and off: companies see brief, sometimes meaningful shifts in consumer behavior, but the effects tend to be transient. While consumers express indignation about individual breaches, and concern in general about data security, they tend not to adjust their behaviors in meaningful ways.

The latest edition of an annual survey by Accenture indicates at least a bit of widening public concern about data security. The global survey found that 13% of respondents in late 2016 said they were not confident about the security of their online data, compared with 7% who said so three years earlier. Still, the tracking survey did not find sharp changes in overall level of comfort over the years. In the latest edition, 58% expressed at least some level of concern about data safety. Three years before: 55%.

Meanwhile, various digital activities that require significant online data disclosures continue to rise—digital shopping and buying, digital banking, social network activity, and more.

—Rimma Kats

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