Entries Tagged "business of security"

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Third Annual Movie-Plot Threat Contest

I can’t believe I let April 1 come and go without posting the rules to the Third Annual Movie-Plot Threat Contest. Well, better late than never.

For this contest, the goal is to create fear. Not just any fear, but a fear that you can alleviate through the sale of your new product idea. There are lots of risks out there, some of them serious, some of them so unlikely that we shouldn’t worry about them, and some of them completely made up. And there are lots of products out there that provide security against those risks.

Your job is to invent one. First, find a risk or create one. It can be a terrorism risk, a criminal risk, a natural-disaster risk, a common household risk—whatever. The weirder the better. Then, create a product that everyone simply has to buy to protect him- or herself from that risk. And finally, write a catalog ad for that product.

Here’s an example, pulled from page 25 of the Late Spring 2008 Skymall catalog I’m reading on my airplane right now:

A Turtle is Safe in Water, A Child is Not!

Even with the most vigilant supervision a child can disappear in seconds and not be missed until it’s too late. Our new wireless pool safety alarm system is a must for pool owners and parents of young children. The Turtle Wristband locks on the child’s wrist (a special key is required to remove it) and instantly detects immersion in water and sounds a shrill alarm at the Base Station located in the house or within 100 feet of the pool, spa, or backyard pond. Keep extra wristbands on hand for guests or to protect the family dog.

Entries are limited to 150 words—the example above had 97 words—because fear doesn’t require a whole lot of explaining. Tell us why we should be afraid, and why we should buy your product.

Entries will be judged on creativity, originality, persuasiveness, and plausibility. It’s okay if the product you invent doesn’t actually exist, but this isn’t a science fiction contest.

Portable salmonella detectors for salad bars. Acoustical devices that estimate tiger proximity based on roar strength. GPS-enabled wallets for use when you’ve been pickpocketed. Wrist cuffs that emit fake DNA to fool DNA detectors. The Quantum Sleeper. Fear offers endless business opportunities. Good luck.

Entries due by May 1.

The First Movie-Plot Threat Contest rules and winner. The Second Movie-Plot Threat Contest rules, semifinalists, and winner.

EDITED TO ADD (4/7): Submit your entry in the comments.

EDITED TO ADD (4/8): You people are frighteningly creative.

Posted on April 7, 2008 at 3:50 PM • View Comments

Outsourcing Passports

The U.S. is outsourcing the manufacture of its RFID passports to some questionable companies.

This is a great illustration of the maxim “security trade-offs are often made for non-security reasons.” I can imagine the manager in charge: “Yes, it’s insecure. But think of the savings!”

The Government Printing Office’s decision to export the work has proved lucrative, allowing the agency to book more than $100 million in recent profits by charging the State Department more money for blank passports than it actually costs to make them, according to interviews with federal officials and documents obtained by The Times.

Another story.

Posted on April 2, 2008 at 6:08 AM • View Comments

Security Products: Suites vs. Best-of-Breed

We know what we don’t like about buying consolidated product suites: one great product and a bunch of mediocre ones. And we know what we don’t like about buying best-of-breed: multiple vendors, multiple interfaces, and multiple products that don’t work well together. The security industry has gone back and forth between the two, as a new generation of IT security professionals rediscovers the downsides of each solution.

The real problem is that neither solution really works, and we continually fool ourselves into believing whatever we don’t have is better than what we have at the time. And the real solution is to buy results, not products.

Honestly, no one wants to buy IT security. People want to buy whatever they want—connectivity, a Web presence, email, networked applications, whatever—and they want it to be secure. That they’re forced to spend money on IT security is an artifact of the youth of the computer industry. And sooner or later the need to buy security will disappear.

It will disappear because IT vendors are starting to realize they have to provide security as part of whatever they’re selling. It will disappear because organizations are starting to buy services instead of products, and demanding security as part of those services. It will disappear because the security industry will disappear as a consumer category, and will instead market to the IT industry.

The critical driver here is outsourcing. Outsourcing is the ultimate consolidator, because the customer no longer cares about the details. If I buy my network services from a large IT infrastructure company, I don’t care if it secures things by installing the hot new intrusion prevention systems, by configuring the routers and servers as to obviate the need for network-based security, or if it uses magic security dust given to it by elven kings. I just want a contract that specifies a level and quality of service, and my vendor can figure it out.

IT is infrastructure. Infrastructure is always outsourced. And the details of how the infrastructure works are left to the companies that provide it.

This is the future of IT, and when that happens we’re going to start to see a type of consolidation we haven’t seen before. Instead of large security companies gobbling up small security companies, both large and small security companies will be gobbled up by non-security companies. It’s already starting to happen. In 2006, IBM bought ISS. The same year BT bought my company, Counterpane, and last year it bought INS. These aren’t large security companies buying small security companies; these are non-security companies buying large and small security companies.

If I were Symantec and McAfee, I would be preparing myself for a buyer.

This is good consolidation. Instead of having to choose between a single product suite that isn’t very good or a best-of-breed set of products that don’t work well together, we can ignore the issue completely. We can just find an infrastructure provider that will figure it out and make it work—who cares how?

This essay originally appeared as the second half of a point/counterpoint with Marcus Ranum in Information Security. Here’s Marcus’s half.

Posted on March 10, 2008 at 6:33 AM • View Comments

Credentica

Cryptographer Stefan Brands has a new company, Credentica, that allows people to disclose personal information while maintaining privacy and minimizing the threat of identity theft.

I know Stefan; he’s good. The cryptography behind this system is almost certainly impeccable. I like systems like this, and I want them to succeed. I just don’t see a viable business model.

I’d like to be proven wrong.

Posted on February 15, 2008 at 5:02 AM • View Comments

Lock-In

Buying an iPhone isn’t the same as buying a car or a toaster. Your iPhone comes with a complicated list of rules about what you can and can’t do with it. You can’t install unapproved third-party applications on it. You can’t unlock it and use it with the cellphone carrier of your choice. And Apple is serious about these rules: A software update released in September 2007 erased unauthorized software and—in some cases—rendered unlocked phones unusable.

“Bricked” is the term, and Apple isn’t the least bit apologetic about it.

Computer companies want more control over the products they sell you, and they’re resorting to increasingly draconian security measures to get that control. The reasons are economic.

Control allows a company to limit competition for ancillary products. With Mac computers, anyone can sell software that does anything. But Apple gets to decide who can sell what on the iPhone. It can foster competition when it wants, and reserve itself a monopoly position when it wants. And it can dictate terms to any company that wants to sell iPhone software and accessories.

This increases Apple’s bottom line. But the primary benefit of all this control for Apple is that it increases lock-in. “Lock-in” is an economic term for the difficulty of switching to a competing product. For some products—cola, for example—there’s no lock-in. I can drink a Coke today and a Pepsi tomorrow: no big deal. But for other products, it’s harder.

Switching word processors, for example, requires installing a new application, learning a new interface and a new set of commands, converting all the files (which may not convert cleanly) and custom software (which will certainly require rewriting), and possibly even buying new hardware. If Coke stops satisfying me for even a moment, I’ll switch: something Coke learned the hard way in 1985 when it changed the formula and started marketing New Coke. But my word processor has to really piss me off for a good long time before I’ll even consider going through all that work and expense.

Lock-in isn’t new. It’s why all gaming-console manufacturers make sure that their game cartridges don’t work on any other console, and how they can price the consoles at a loss and make the profit up by selling games. It’s why Microsoft never wants to open up its file formats so other applications can read them. It’s why music purchased from Apple for your iPod won’t work on other brands of music players. It’s why every U.S. cellphone company fought against phone number portability. It’s why Facebook sues any company that tries to scrape its data and put it on a competing website. It explains airline frequent flyer programs, supermarket affinity cards and the new My Coke Rewards program.

With enough lock-in, a company can protect its market share even as it reduces customer service, raises prices, refuses to innovate and otherwise abuses its customer base. It should be no surprise that this sounds like pretty much every experience you’ve had with IT companies: Once the industry discovered lock-in, everyone started figuring out how to get as much of it as they can.

Economists Carl Shapiro and Hal Varian even proved that the value of a software company is the total lock-in. Here’s the logic: Assume, for example, that you have 100 people in a company using MS Office at a cost of $500 each. If it cost the company less than $50,000 to switch to Open Office, they would. If it cost the company more than $50,000, Microsoft would increase its prices.

Mostly, companies increase their lock-in through security mechanisms. Sometimes patents preserve lock-in, but more often it’s copy protection, digital rights management (DRM), code signing or other security mechanisms. These security features aren’t what we normally think of as security: They don’t protect us from some outside threat, they protect the companies from us.

Microsoft has been planning this sort of control-based security mechanism for years. First called Palladium and now NGSCB (Next-Generation Secure Computing Base), the idea is to build a control-based security system into the computing hardware. The details are complicated, but the results range from only allowing a computer to boot from an authorized copy of the OS to prohibiting the user from accessing “unauthorized” files or running unauthorized software. The competitive benefits to Microsoft are enormous (.pdf).

Of course, that’s not how Microsoft advertises NGSCB. The company has positioned it as a security measure, protecting users from worms, Trojans and other malware. But control does not equal security; and this sort of control-based security is very difficult to get right, and sometimes makes us more vulnerable to other threats. Perhaps this is why Microsoft is quietly killing NGSCB—we’ve gotten BitLocker, and we might get some other security features down the line—despite the huge investment hardware manufacturers made when incorporating special security hardware into their motherboards.

In my last column, I talked about the security-versus-privacy debate, and how it’s actually a debate about liberty versus control. Here we see the same dynamic, but in a commercial setting. By confusing control and security, companies are able to force control measures that work against our interests by convincing us they are doing it for our own safety.

As for Apple and the iPhone, I don’t know what they’re going to do. On the one hand, there’s this analyst report that claims there are over a million unlocked iPhones, costing Apple between $300 million and $400 million in revenue. On the other hand, Apple is planning to release a software development kit this month, reversing its earlier restriction and allowing third-party vendors to write iPhone applications. Apple will attempt to keep control through a secret application key that will be required by all “official” third-party applications, but of course it’s already been leaked.

And the security arms race goes on …

This essay previously appeared on Wired.com.

EDITED TO ADD (2/12): Slashdot thread.

And critical commentary, which is oddly political:

This isn’t lock-in, it’s called choosing a product that meets your needs. If you don’t want to be tied to a particular phone network, don’t buy an iPhone. If installing third-party applications (between now and the end of February, when officially-sanctioned ones will start to appear) is critically important to you, don’t buy an iPhone.

It’s one thing to grumble about an otherwise tempting device not supporting some feature you would find useful; it’s another entirely to imply that this represents anti-libertarian lock-in. The fact remains, you are free to buy one of the many other devices on the market that existed before there ever was an iPhone.

Actually, lock-in is one of the factors you have to consider when choosing a product to meet your needs. It’s not one thing or the other. And lock-in is certainly not “anti-libertarian.” Lock-in is what you get when you have an unfettered free market competing for customers; it’s libertarian utopia. Government regulations that limit lock-in tactics—something I think would be very good for society—is what’s anti-libertarian.

Here’s a commentary on that previous commentary. This is some good commentary, too.

Posted on February 12, 2008 at 6:08 AM • View Comments

The Cybercrime Economy

Interesting article:

While standard commercial software vendors sell software as a service, malware vendors sell malware as a service, which is advertised and distributed like standard software. Communicating via internet relay chat (IRC) and forums, hackers advertise Iframe exploits, pop-unders, click fraud, posting and spam. “If you don’t have it, you can rent it here,” boasts one post, which also offers online video tutorials. Prices for services vary by as much as 100-200 percent across sites, while prices for non-Russian sites are often higher: “If you want the discount rate, buy via Russian sites,” says Genes.

In March the price quoted on malware sites for the Gozi Trojan, which steals data and sends it to hackers in an encrypted form, was between $1,000 (£500) and $2,000 for the basic version. Buyers could purchase add-on services at varying prices starting at $20.

This kind of thing is also discussed here.

Posted on January 2, 2008 at 7:21 AM • View Comments

Security in Ten Years

This is a conversation between myself and Marcus Ranum. It will appear in Information Security Magazine this month.

Bruce Schneier: Predictions are easy and difficult. Roy Amara of the Institute for the Future once said: “We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.”

Moore’s Law is easy: In 10 years, computers will be 100 times more powerful. My desktop will fit into my cell phone, we’ll have gigabit wireless connectivity everywhere, and personal networks will connect our computing devices and the remote services we subscribe to. Other aspects of the future are much more difficult to predict. I don’t think anyone can predict what the emergent properties of 100x computing power will bring: new uses for computing, new paradigms of communication. A 100x world will be different, in ways that will be surprising.

But throughout history and into the future, the one constant is human nature. There hasn’t been a new crime invented in millennia. Fraud, theft, impersonation and counterfeiting are perennial problems that have been around since the beginning of society. During the last 10 years, these crimes have migrated into cyberspace, and over the next 10, they will migrate into whatever computing, communications and commerce platforms we’re using.

The nature of the attacks will be different: the targets, tactics and results. Security is both a trade-off and an arms race, a balance between attacker and defender, and changes in technology upset that balance. Technology might make one particular tactic more effective, or one particular security technology cheaper and more ubiquitous. Or a new emergent application might become a favored target.

I don’t see anything by 2017 that will fundamentally alter this. Do you?

Marcus Ranum: I think you’re right; at a meta-level, the problems are going to stay the same. What’s shocking and disappointing to me is that our responses to those problems also remain the same, in spite of the obvious fact that they aren’t effective. It’s 2007 and we haven’t seemed to accept that:

  • You can’t turn shovelware into reliable software by patching it a whole lot.
  • You shouldn’t mix production systems with non-production systems.
  • You actually have to know what’s going on in your networks.
  • If you run your computers with an open execution runtime model you’ll always get viruses, spyware and Trojan horses.
  • You can pass laws about locking barn doors after horses have left, but it won’t put the horses back in the barn.
  • Security has to be designed in, as part of a system plan for reliability, rather than bolted on afterward.

The list could go on for several pages, but it would be too depressing. It would be “Marcus’ list of obvious stuff that everybody knows but nobody accepts.”

You missed one important aspect of the problem: By 2017, computers will be even more important to our lives, economies and infrastructure.

If you’re right that crime remains a constant, and I’m right that our responses to computer security remain ineffective, 2017 is going to be a lot less fun than 2007 was.

I’ve been pretty dismissive of the concepts of cyberwar and cyberterror. That dismissal was mostly motivated by my observation that the patchworked and kludgy nature of most computer systems acts as a form of defense in its own right, and that real-world attacks remain more cost-effective and practical for terror purposes.

I’d like to officially modify my position somewhat: I believe it’s increasingly likely that we’ll suffer catastrophic failures in critical infrastructure systems by 2017. It probably won’t be terrorists that do it, though. More likely, we’ll suffer some kind of horrible outage because a critical system was connected to a non-critical system that was connected to the Internet so someone could get to MySpace—­and that ancillary system gets a piece of malware. Or it’ll be some incomprehensibly complex software, layered with Band-Aids and patches, that topples over when some “merely curious” hacker pushes the wrong e-button. We’ve got some bad-looking trend lines; all the indicators point toward a system that is more complex, less well-understood and more interdependent. With infrastructure like that, who needs enemies?

You’re worried criminals will continue to penetrate into cyberspace, and I’m worried complexity, poor design and mismanagement will be there to meet them.

Bruce Schneier: I think we’ve already suffered that kind of critical systems failure. The August 2003 blackout that covered much of northeastern United States and Canada­—50 million people­—was caused by a software bug.

I don’t disagree that things will continue to get worse. Complexity is the worst enemy of security, and the Internet—and the computers and processes connected to it—­is getting more complex all the time. So things are getting worse, even though security technology is improving. One could say those critical insecurities are another emergent property of the 100x world of 2017.

Yes, IT systems will continue to become more critical to our infrastructure­—banking, communications, utilities, defense, everything.

By 2017, the interconnections will be so critical that it will probably be cost-effective—and low-risk—for a terrorist organization to attack over the Internet. I also deride talk of cyberterror today, but I don’t think I will in another 10 years.

While the trends of increased complexity and poor management don’t look good, there is another trend that points to more security—but neither you nor I is going to like it. That trend is IT as a service.

By 2017, people and organizations won’t be buying computers and connectivity the way they are today. The world will be dominated by telcos, large ISPs and systems integration companies, and computing will look a lot like a utility. Companies will be selling services, not products: email services, application services, entertainment services. We’re starting to see this trend today, and it’s going to take off in the next 10 years. Where this affects security is that by 2017, people and organizations won’t have a lot of control over their security. Everything will be handled at the ISPs and in the backbone. The free-wheeling days of general-use PCs will be largely over. Think of the iPhone model: You get what Apple decides to give you, and if you try to hack your phone, they can disable it remotely. We techie geeks won’t like it, but it’s the future. The Internet is all about commerce, and commerce won’t survive any other way.

Marcus Ranum: You’re right about the shift toward services—it’s the ultimate way to lock in customers.

If you can make it difficult for the customer to get his data back after you’ve held it for a while, you can effectively prevent the customer from ever leaving. And of course, customers will be told “trust us, your data is secure,” and they’ll take that for an answer. The back-end systems that will power the future of utility computing are going to be just as full of flaws as our current systems. Utility computing will also completely fail to address the problem of transitive trust unless people start shifting to a more reliable endpoint computing platform.

That’s the problem with where we’re heading: the endpoints are not going to get any better. People are attracted to appliances because they get around the headache of system administration (which, in today’s security environment, equates to “endless patching hell”), but underneath the slick surface of the appliance we’ll have the same insecure nonsense we’ve got with general-purpose desktops. In fact, the development of appliances running general-purpose operating systems really does raise the possibility of a software monoculture. By 2017, do you think system engineering will progress to the point where we won’t see a vendor release a new product and instantly create an installed base of 1 million-plus users with root privileges? I don’t, and that scares me.

So if you’re saying the trend is to continue putting all our eggs in one basket and blithely trusting that basket, I agree.

Another trend I see getting worse is government IT know-how. At the rate outsourcing has been brain-draining the federal workforce, by 2017 there won’t be a single government employee who knows how to do anything with a computer except run PowerPoint and Web surf. Joking aside, the result is that the government’s critical infrastructure will be almost entirely managed from the outside. The strategic implications of such a shift have scared me for a long time; it amounts to a loss of control over data, resources and communications.

Bruce Schneier: You’re right about the endpoints not getting any better. I’ve written again and again how measures like two-factor authentication aren’t going to make electronic banking any more secure. The problem is if someone has stuck a Trojan on your computer, it doesn’t matter how many ways you authenticate to the banking server; the Trojan is going to perform illicit transactions after you authenticate.

It’s the same with a lot of our secure protocols. SSL, SSH, PGP and so on all assume the endpoints are secure, and the threat is in the communications system. But we know the real risks are the endpoints.

And a misguided attempt to solve this is going to dominate computing by 2017. I mentioned software-as-a-service, which you point out is really a trick that allows businesses to lock up their customers for the long haul. I pointed to the iPhone, whose draconian rules about who can write software for that platform accomplishes much the same thing. We could also point to Microsoft’s Trusted Computing, which is being sold as a security measure but is really another lock-in mechanism designed to keep users from switching to “unauthorized” software or OSes.

I’m reminded of the post-9/11 anti-terrorist hysteria—we’ve confused security with control, and instead of building systems for real security, we’re building systems of control. Think of ID checks everywhere, the no-fly list, warrantless eavesdropping, broad surveillance, data mining, and all the systems to check up on scuba divers, private pilots, peace activists and other groups of people. These give us negligible security, but put a whole lot of control in the government’s hands.

Computing is heading in the same direction, although this time it is industry that wants control over its users. They’re going to sell it to us as a security system—they may even have convinced themselves it will improve security—but it’s fundamentally a control system. And in the long run, it’s going to hurt security.

Imagine we’re living in a world of Trustworthy Computing, where no software can run on your Windows box unless Microsoft approves it. That brain drain you talk about won’t be a problem, because security won’t be in the hands of the user. Microsoft will tout this as the end of malware, until some hacker figures out how to get his software approved. That’s the problem with any system that relies on control: Once you figure out how to hack the control system, you’re pretty much golden. So instead of a zillion pesky worms, by 2017 we’re going to see fewer but worse super worms that sail past our defenses.

By then, though, we’ll be ready to start building real security. As you pointed out, networks will be so embedded into our critical infrastructure—­and there’ll probably have been at least one real disaster by then—that we’ll have no choice. The question is how much we’ll have to dismantle and build over to get it right.

Marcus Ranum: I agree regarding your gloomy view of the future. It’s ironic the counterculture “hackers” have enabled (by providing an excuse) today’s run-patch-run-patch-reboot software environment and tomorrow’s software Stalinism.

I don’t think we’re going to start building real security. Because real security is not something you build—­it’s something you get when you leave out all the other garbage as part of your design process. Purpose-designed and purpose-built software is more expensive to build, but cheaper to maintain. The prevailing wisdom about software return on investment doesn’t factor in patching and patch-related downtime, because if it did, the numbers would stink. Meanwhile, I’ve seen purpose-built Internet systems run for years without patching because they didn’t rely on bloated components. I doubt industry will catch on.

The future will be captive data running on purpose-built back-end systems—and it won’t be a secure future, because turning your data over always decreases your security. Few possess the understanding of complexity and good design principles necessary to build reliable or secure systems. So, effectively, outsourcing—or other forms of making security someone else’s problem—will continue to seem attractive.
That doesn’t look like a very rosy future to me. It’s a shame, too, because getting this stuff correct is important. You’re right that there are going to be disasters in our future.

I think they’re more likely to be accidents where the system crumbles under the weight of its own complexity, rather than hostile action. Will we even be able to figure out what happened, when it happens?

Folks, the captains have illuminated the “Fasten your seat belts” sign. We predict bumpy conditions ahead.

EDITED TO ADD (12/4): Commentary on the point/counterpoint.

Posted on December 3, 2007 at 12:14 PM • View Comments

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Sidebar photo of Bruce Schneier by Joe MacInnis.