Play Group Turns Rackspace into Cloud for $10.8M

Cloud Provider Rackspace Technology Inc. has spent $10.8 million to mitigate the impact of a large-scale cyber attack that occurred in December of last year.

According to statements, the majority of the funds were used to pay for the services of an international cybersecurity company. Additionally, some of the funds were allocated to legal support and hiring additional personnel to assist the victims.

Multiple lawsuits are being filed in San Antonio, Los Angeles, and New York. While the official documents from RackSpace, the US Securities and Exchange Commission, and the Exchange state that the company will not suffer significant financial damage from the legal claims, it is currently impossible to accurately assess the potential losses.

RackSpace expects that a significant portion of the incident costs will be covered by cyber insurance.

In May, the court ruled in favor of Rackspace, dismissing a collective lawsuit filed by 37 users from various states in the US who had lost access to their data during the attack.

An internal investigation revealed that a hacker group known as “Play” was behind the attack. The attackers exploited a new method of infiltrating the Hosted Exchange network by leveraging the vulnerability identified as CVE-2022-41080. This allowed them to gain access to email correspondence, calendars, tasks, address books, and other data stored in PST-files (Personal Storage Table).

Following the incident, the market value of Rackspace has declined, indicating a loss of investor trust. Long-term financial forecasts have become less optimistic.

Despite the current challenges, the leadership remains optimistic. The company has launched a new initiative in the field of artificial intelligence, aiming to develop its own chatbot for handling customer calls.

Rackspace CEO, Amar Maletira, is confident that his team is on the right track despite the difficulties. “The progress we have made so far is significant, and we are focused on long-term sustainable development,” he stated.