Egghead Software Becomes Latest Cracking Casualty

Despite having spent many months strengthening security to combat what Egghead.com Inc. calls the "increasing, industrywide problem of malicious hacking," the online electronics retailer Friday said its defenses had been breached.

According to the brief statement, Egghead admits a hacker accessed its computers, and possibly the company's customer databases. As a precaution, the company says, it has contacted credit-card companies so the card issuers and banks can take steps to protect customers whose personal information may have been bagged.

Egghead says it's cooperating with a criminal investigation. Peter S. Tippett, chief technologist for the security company TruSecure Corp., says he isn't surprised by the attack and that the problem is going to grow exponentially. "The rate of online credit-card left is going to go up next year. And the reason companies fail is because they don't keep up on the easy things. When we looked at previous credit-card break-ins, they all overlooked multiple and easy security measures that made them vulnerable," Tippett says.

Egghead execs were not available for comment.