Apple (AAPL) users can now make their online transactions more secure by opting for a two-step verification process. The process asks an Apple user to register one or more trusted devices such as an iPhone, which will receive a 4-digit verification code at the time of logging.
The user is required to provide the verification code along with Apple ID and password in order to gain access. The user will also receive a 14-digit recovery key, which can be used to regain access to the Apple account, in case the device is lost or the user forgets the password. The security tool is currently available to Apple users in the United States, United Kingdom, Australia, Ireland and New Zealand.
The two-step verification process adds an extra layer of authentication for customers using the iCloud. The security tool, already used by the likes of eBay (EBAY), Google (GOOG) and Facebook (FB), makes it difficult for hackers to gain access to personal accounts.
Apple: The New Target of Hackers
Considered to be one of the most secured online service providers, Apple’s security vulnerabilities came into the limelight when the iCloud account of a reporter was hacked in Aug 2012. The incident forced Apple to change its security policy. Since then, the company has imposed restrictions on resetting Apple IDs over the phone.
Traditionally, hackers have targeted computers running Microsoft’s Windows operating system. However, Apple was the latest target of a severe cyber attack. In Feb 2013, Apple’s Macintosh computers were infected, after iPhone developers visited a website containing a malware. Hackers used a security flaw in the Java software to infect the website.
According to Reuters, security experts believe that hackers are now targeting Apple to gain access to the code for apps on smartphones. A breach will help them to infect millions of smartphones. Cyber security experts also noted that hackers may exploit a flaw in Adobe’s flash software to attack Apple going forward.
In such a scenario, we believe that the latest security enhancement from Apple will boost customer confidence going forward. However, we believe that Apple should make the two-step verification process mandatory due to the rising frequency and severity of attacks.
Conclusion
We believe that cyber security will be the most debated topic in 2013, particularly due to the string of attacks on major corporations such as Apple, which has shown the vulnerability of the present security systems. However, we do not see a conclusive solution to the problem any time in the near future. We think hacking activity will continue as will the adoption of security measures for its prevention.
Currently, Apple has a Zacks Rank #3 (Hold).
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