Microsoft blames Delta for its struggle to recover from global cyber outage
Adds Delta's comments, more background details
By Rajesh Kumar Singh
CHICAGO, Aug 6 (Reuters) -Microsoft MSFT.O blamed Delta Air Lines DAL.N on Tuesday for its dayslong struggle to recover from a global cyber outage that led it to cancel more than 6,000 flights.
A software update last month by global cybersecurity firm CrowdStrike CRWD.O triggered system problems for Microsoft customers, including many airlines. But disruptions subsided the next day at other major U.S. carriers while persisting at Delta.
Microsoft said its preliminary review suggested that Delta, unlike its competitors, apparently had not modernized its IT infrastructure.
Delta, however, said it has invested billions of dollars in IT capital expenditures since 2016, in addition to the billions it spends every year in IT operating costs.
"Delta has a long track record of investing in safe, reliable and elevated service for our customers and employees," a company spokesperson said.
The flight disruptions stranded hundreds of thousands of travelers and are estimated to cost the Atlanta-based airline $500 million. Delta is also facing an investigation from the U.S. Transportation Department for the disruptions.
It has hired prominent litigator David Boies of Boies Schiller Flexner, known for high-stakes business cases, to seek damages from both CrowdStrike and Microsoft.
Last week, Delta's CEO Ed Bastian told CNBC that while the airline heavily relies on the two tech companies, they had failed to deliver an "exceptional service." In the interview, he also said that Microsoft had the "most fragile platform."
In a letter, Mark Cheffo, a lawyer for Microsoft, called the airline's comments "incomplete, false, misleading, and damaging to Microsoft and its reputation."
Cheffo said Microsoft's software had not caused the CrowdStrike incident, but the tech giant immediately offered to assist Delta at no charge. Its CEO Satya Nadella emailed Bastian, but never got a reply, he added.
Microsoft said its employees repeatedly offered to help Delta following the outage, but the U.S. carrier turned them down. It accused the airline of using services of other technology providers for its crew-tracking and scheduling system and alleged it as a likely reason for declining its help.
Cheffo said Microsoft will "vigorously" defend itself if Delta files a lawsuit.
CrowdStrike has also rejected Delta's claim that it should be blamed for flight disruptions. The cybersecurity firm said its CEO had personally reached out to Bastian to offer onsite assistance, but received no response.
Reporting by Rajesh Kumar Singh; Additional reporting by David Shepardson; Editing by Franklin Paul and Josie Kao
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
