"A few MSN Hotmail servers were affected by the Code Red worm virus. The servers were promptly removed from the MSN Hotmail environment, shut down and patched," said a spokeswoman in the UK, adding that the infection was detected late Wednesday afternoon in the US.
The two infected systems were a test system and a production system, the spokeswoman said, adding that no user data was compromised and that all users should be able to access the Hotmail service securely. Hotmail has over 100 million users worldwide.
Microsoft has taken extra steps to ensure the security of its network and servers to minimise the impact of the worm, according to the spokeswoman. The company seems to have been caught by the Code Red II (also known as Code Red 3.0) variant of the original Code Red worm that surfaced last weekend.
"Our understanding of the Code Red variant is that it is very effective and has a greater potential to compromise systems," the spokeswoman said.
Code Red and Code Red II exploit a known hole in Microsoft's Internet Information Server (IIS) software. A patch for the vulnerability has been available since mid-June. Microsoft was part of an unprecedented public relations campaign in late July that urged all users of the software, a standard component of Windows 2000 and Windows NT, to install that patch in the wake of the Code Red reawakening on 1 August.
This is not the first time that Microsoft has neglected to install its own security patches. Dutch hacker Dimitri managed to hack into a Microsoft Web server twice last year, the second time after Microsoft said its security personnel had plugged the security hole exploited by Dimitri.
Besides Microsoft, Code Red has also claimed other victims around the world. Employees of consulting company Cap Gemini Ernst & Young in some countries on Tuesday had no access to their intranet for several hours because of the worm, a spokeswoman confirmed. About 30,000 digital subscriber line users in Taiwan were attacked, slowing down their Internet connection, according to security firm Trend Micro.