Trio of serious computer glitches raises worry about tech reliance

The nation's biggest airline, biggest stock exchange and most prominent business newspaper all suffered long online service interruptions on Wednesday. That came just as worries over the vulnerabilities of digital technology were front and center at a congressional hearing. Judy Woodruff explores the disruptions with Kevin Mandia, president of FireEye, and Michael Regan of Bloomberg.

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    Worries over the vulnerability of our technology and computer networks dominated the day for travelers and for Wall Street.

    Even before what turned into a series of cascading computer failures, hacking intelligence and security — national security were already the focus of a day of hearings on Capitol Hill.


    The nation's biggest airline, biggest stock exchange, and most prominent business newspaper suffered long service interruptions.

    First, an Internet router issue at United Airlines suspended all its flights for nearly two hours. The problem led to 800 flight delays and 60 cancellations. Then, shortly before noon, what was labeled a technical problem halted trading at the New York Stock Exchange. It lasted almost four hours, the longest suspension of trading on that exchange in several years.

    Finally, the web site of The Wall Street Journal suffered technical difficulties that sent readers to a temporary site.

    We explore disruptions and vulnerabilities now with Michael Regan of Bloomberg News, and Kevin Mandia, who is the president of FireEye. That's a company that specializes in dealing with cyber-security and network protection.

    And we welcome you both to the program.

    Michael Regan, to you first. Let's start with the New York Stock Exchange, closed down for over three hours. How big a disruption was this and what's known about what caused it?

  • MICHAEL REGAN, Bloomberg News:

    Well, the problems at the New York Stock Exchange actually started even before the market opened, when traders send pre-market orders to the exchange, and it was clear that the communication between brokerages and the exchange wasn't working properly.

    A lot of customers were not getting the confirmations that their orders had been received. That obviously can cause a lot of problems. It could possibly cause traders to resend orders and have duplicate orders in the system.

    And, at first, it looked like it was just a routine glitch that exchanges deal with all the time. However, by 11:30, as you said, the exchange made the decision to shut down trading on that exchange. Now, it's important to point out that there are 11 official stock exchanges in the U.S. right now and in the neighborhood of 50 alternative venues where trades can be matched.

    So the market was able to function pretty much as normal. They simply routed orders away from the New York Stock Exchange to the other exchanges out there. That said, it certainly is the type of thing that can affect investor confidence, especially after a long series of glitches on electronic exchanges that we have seen over the last five years or so.


    And what about the other two institutions we mentioned, of course, United Airlines, where flights were delayed, were canceled, and The Wall Street Journal?


    So, United had an issue with a computer router, which is the device that connects various networks, and it caused them not to be able to issue tickets to passengers and not be able to dispatch staff properly, so it shut down flights for about two hours.

    At the same time, about 20 minutes or so after the New York Stock Exchange went down, The Wall Street Journal home page, as you said, started having issues and was unavailable. So there was a lot of sort of speculation flowing through the markets that all three incidents were related and that there was some sort of targeted attack on the U.S.

    Those concerns were dismissed pretty quickly. You know, the officials from the companies said that they were not related. Homeland Security said it didn't appear like cyber-attacks were the issue. So, at the moment, it looks like it was just three separate computer issues at three separate companies. It is possible The Wall Street Journal got a lot of heavy traffic after the New York Stock Exchange shut down, when people went to look up the news about what was going on.

    So, although they haven't said that, that certainly sounds like a plausible explanation.


    Kevin Mandia, what would you add to that in terms of what is known about the cause and whether there was the possibility of some cyber-attack?

  • KEVIN MANDIA, President, FireEye:

    Well, any time you have — your network goes dark, you have a hardware or a software problem or a security problem. So, it's one of the three or a combination of them.

    But right now everything I'm hearing, it's a software glitch or a hardware problem. And no one's talking about a security issue here. What we can take from this, though, is the day there are attacks and there are security issues, it's always good to have a second way to do business, go back to the old-fashioned way of doing things, whether it's a hardware, software or security issue.

    So, we probably got a good drill today.


    Well, Kevin Mandia, staying with you, what does this tell us, if anything, about the vulnerability of these big systems? And I realize they're all very different operations. Because we know the technology is getting bigger, it's getting more complex, what does it say about their ability to handle that?


    Well, we rely on these things, but I think we're doing pretty good. It's hard to be in the airlines and go dark and have nobody notice, or to be a news outlet like The Wall Street Journal and go dark and have nobody notice, or be a stock exchange and not have availability and nobody notice.

    You're talking three of the most prominent businesses or industries you can be in. There's nowhere to hide when you have an issue like this, but these issues don't come up every day and I anticipate we will probably go multiple years before we see something like this happen again.


    Michael Regan, as somebody who has covered the exchanges and covers Wall Street, how vulnerable do these institutions think they are to this sort of thing? Do they feel they are prepared for what may come?


    The U.S. stock market has become this massive, complex computer system spread out over, like I said, so many different exchanges.

    These type of glitches do happen from time to time, but this one made headlines because it's the New York Stock Exchange. It's an icon. But, again, what happens today sort of shows how it's good that the system is spread out over this many exchanges, that when one goes down, the others are able to take up the slack and take over the business for them temporarily.

    And you know, in that respect, it was a success today that the system operated that way. That said, there are a lot of people that believe, a lot of critics of the industry that believe it has gotten way too complex, that we don't need 11 stock exchanges and the other venues, that maybe four or five would be enough, and this is certainly going to reignite the debate about whether or not the market has become too complex.


    Well, pick that up, Kevin Mandia. Whether it's the stock exchange or the airlines or another big institution, how prepared are they for the kind of incredibly more complicated technological world that we know we're heading into?


    Well, everybody is trying to get more prepared. That's what we're all doing.

    If you look over the last 15 years in cyber-security, there has been more and more attacks. The watermark of security is going up in our nation because everybody is more aware with all the headlines that you read almost on a daily basis about another attack or another threat.

    We don't have good rules in cyberspace right now. We have countries hacking other countries. We have criminals trying to hack on a daily basis. So everyone is getting more prepared for that, because right now, if you're hacked, whether you're hacked by a 15-year-old kid or hacked by a military garnering intelligence from your organization, the liabilities are the same, so everybody is really raising their awareness.


    Kevin Mandia, Michael Regan, we thank you both.


    Thank you.


    Thank you.

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