This is an excellent point, but you can also envision attack scenarios in which only parts of a distributed system are compromised. In that case, the inability

This is an excellent point, but you can also envision attack scenarios in which only parts of a distributed system are compromised. In that case, the inability of some systems to read the data that they store could be a benefit because the systems that are compromised are not absolutely guaranteed to be the same systems that possess the keys. One nice example of this which I once saw in a real system is that a system that collects credit card numbers from the public might not need to be able to read those numbers after they're recorded, if the charges are going to be made by a later batch process. So the credit card number receiving system can use a public key to encrypt the incoming data in such a way that the batch processor will later be able to decrypt it. In this case, there is certainly a machine that has the capacity to read the data, but it's not the same machine that stores the data or that is exposed to connections from the general public. (But that paradigm is a lot easier for the case of offline batch processing, which is mostly different from the applications that you were describing... but wherever a system has a component like this, it may be possible to reduce the window of exposure with this pattern.) Another example is that a database server might be compromised via a different vector from its clients. If some database fields were encrypted, the impact of a database-only compromise would be reduced. Edit: elsewhere in this thread someone points out that your argument may be meant to be more specific to this breach, and I think it's most likely right with respect to this particular incident.