Entries Tagged "computer security"

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Information Security and Externalities

Information insecurity is costing us billions. There are many different ways in which we pay for information insecurity. We pay for it in theft, such as information theft, financial theft and theft of service. We pay for it in productivity loss, both when networks stop functioning and in the dozens of minor security inconveniences we all have to endure on a daily basis. We pay for it when we have to buy security products and services to reduce those other two losses. We pay for the lack of security, year after year.

Fundamentally, the issue is insecure software. It is a result of bad design, poorly implemented features, inadequate testing and security vulnerabilities from software bugs. The money we spend on security is to deal with the myriad effects of insecure software. Unfortunately, the money spent does not improve the security of that software. We are paying to mitigate the risk rather than fix the problem.

The only way to fix the problem is for vendors to improve their software. They need to design security in their products from the start and not as an add-on feature. Software vendors need also to institute good security practices and improve the overall quality of their products. But they will not do this until it is in their financial best interests to do so. And so far, it is not.

The reason is easy to explain. In a capitalist society, businesses are profit-making ventures, so they make decisions based on both short- and long-term profitability. This holds true for decisions about product features and sale prices, but it also holds true for software. Vendors try to balance the costs of more secure software—extra developers, fewer features, longer time to market—against the costs of insecure software: expense to patch, occasional bad press, potential loss of sales.

So far, so good. But what the vendors do not look at is the total costs of insecure software; they only look at what insecure software costs them. And because of that, they miss a lot of the costs: all the money we, the software product buyers, are spending on security. In economics, this is known as an externality: the cost of a decision that is borne by people other than those taking the decision.

Normally, you would expect users to respond by favouring secure products over insecure products—after all, users are also making their buying decisions based on the same capitalist model. Unfortunately, that is not generally possible. In some cases software monopolies limit the available product choice; in other cases, the ‘lock-in effect’ created by proprietary file formats or existing infrastructure or compatibility requirements makes it harder to switch; and in still other cases, none of the competing companies have made security a differentiating characteristic. In all cases, it is hard for an average buyer to distinguish a truly secure product from an insecure product with a ‘trust us’ marketing campaign.

Because of all these factors, there are no real consequences to the vendors for having insecure or low-quality software. Even worse, the marketplace often rewards low quality. More precisely, it rewards additional features and timely release dates, even if they come at the expense of quality. The result is what we have all witnessed: insecure software. Companies find that it is cheaper to weather the occasional press storm, spend money on PR campaigns touting good security and fix public problems after the fact, than to design security in from the beginning.

And so the externality remains…

If we expect software vendors to reduce features, lengthen development cycles and invest in secure software development processes, it needs to be in their financial best interests to do so. If we expect corporations to spend significant resources on their own network security—especially the security of their customers—it also needs to be in their financial best interests.

Liability law is one way to make it in those organisations’ best interests. If end users could sue software manufacturers for product defects, then the cost of those defects to the software manufacturers would rise. Manufacturers would then pay the true economic cost for poor software, and not just a piece of it. So when they balance the cost of making their software secure versus the cost of leaving their software insecure, there would be more costs on the latter side. This would provide an incentive for them to make their software more secure.

Basically, we have to tweak the risk equation in such a way that the Chief Executive Officer (CEO) of a company cares about actually fixing the problem—and putting pressure on the balance sheet is the best way to do that. Security is risk management; liability fiddles with the risk equation.

Clearly, liability is not all or nothing. There are many parties involved in a typical software attack. The list includes:

  • the company that sold the software with the vulnerability in the first place
  • the person who wrote the attack tool
  • the attacker himself, who used the tool to break into a network
  • and finally, the owner of the network, who was entrusted with defending that network.

100% of the liability should not fall on the shoulders of the software vendor, just as 100% should not fall on the attacker or the network owner. But today, 100% of the cost falls directly on the network owner, and that just has to stop.

Certainly, making software more secure will cost money, and manufacturers will have to pass those costs on to users in the form of higher prices. But users are already paying extra costs for insecure software: costs of third-party security products, costs of consultants and security services companies, direct and indirect costs of losses. But as long as one is going to pay anyway, it would be better to pay to fix the problem. Forcing the software vendor to pay to fix the problem and then passing those costs on to users means that the actual problem might get fixed.

Liability changes everything. Currently, there is no reason for a software company not to offer feature after feature after feature, without any regard to security. Liability forces software companies to think twice before changing something. Liability forces companies to protect the data they are entrusted with. Liability means that those in the best position to fix the problem are actually responsible for the problem.

Information security is not a technological problem. It is an economics problem. And the way to improve information security is to fix the economics problem. If this is done, companies will come up with the right technological solutions that vendors will happily implement. Fail to solve the economics problem, and vendors will not bother implementing or researching any security technologies, regardless of how effective they are.

This essay previously appeared in the European Network and Information Security Agency quarterly newsletter, and is an update to a 2004 essay I wrote for Computerworld.

Posted on January 18, 2007 at 7:04 AMView Comments

NSA Helps Microsoft with Windows Vista

Is this a good idea or not?

For the first time, the giant software maker is acknowledging the help of the secretive agency, better known for eavesdropping on foreign officials and, more recently, U.S. citizens as part of the Bush administration’s effort to combat terrorism. The agency said it has helped in the development of the security of Microsoft’s new operating system—the brains of a computer—to protect it from worms, Trojan horses and other insidious computer attackers.

[…]

The NSA declined to comment on its security work with other software firms, but Sager said Microsoft is the only one “with this kind of relationship at this point where there’s an acknowledgment publicly.”

The NSA, which provided its service free, said it was Microsoft’s idea to acknowledge the spy agency’s role.

It’s called the “equities issue.” Basically, the NSA has two roles: eavesdrop on their stuff, and protect our stuff. When both sides use the same stuff—Windows Vista, for example—the agency has to decide whether to exploit vulnerabilities to eavesdrop on their stuff or close the same vulnerabilities to protect our stuff. In its partnership with Microsoft, it could have decided to go either way: to deliberately introduce vulnerabilities that it could exploit, or deliberately harden the OS to protect its own interests.

A few years ago I was ready to believe the NSA recognized we’re all safer with more secure general-purpose computers and networks, but in the post-9/11 take-the-gloves-off eavesdrop-on-everybody environment, I simply don’t trust the NSA to do the right thing.

“I kind of call it a Good Housekeeping seal” of approval, said Michael Cherry, a former Windows program manager who now analyzes the product for Directions on Microsoft, a firm that tracks the software maker.

Cherry says the NSA’s involvement can help counter the perception that Windows is not entirely secure and help create a perception that Microsoft has solved the security problems that have plagued it in the past. “Microsoft also wants to make the case that [the new Windows] more secure than its earlier versions,” he said.

For some of us, the result is the exact opposite.

EDITED TO ADD (1/11): Another opinion.

Posted on January 9, 2007 at 12:43 PMView Comments

Why Management Doesn't Get IT Security

At the request of the Department of Homeland Security, a group called The Conference Board completed a study about senior management and their perceptions of IT security. The results aren’t very surprising.

Most C-level executives view security as an operational issue—kind of like facilities management—and not as a strategic review. As such, they don’t have direct responsibility for security.

Such attitudes about security have caused many organizations to distance their security teams from other parts of the business as well. “Security directors appear to be politically isolated within their companies,” Cavanagh says. Security pros often do not talk to business managers or other departments, he notes, so they don’t have many allies in getting their message across to upper management.

What to do? The report has some suggestions, the same ones you can hear at any security conference anywhere.

Security managers need to reach out more aggressively to other areas of the business to help them make their case, Cavanagh says. “Risk managers are among the best potential allies,” he observes, because they are usually tasked with measuring the financial impact of various threats and correlating them with the likelihood that those threats will happen.

“That can be tricky, because most risk managers come from a financial background, and they don’t speak the same language as the security people,” Cavanagh notes. “It’s also difficult because security presents some unusual risk scenarios. There are some franchise events that could destroy the company’s business, but have a very low likelihood of occurrence, so it’s very hard to gauge the risk.”

Getting attention (and budget) from top executives such as risk managers, CFOs, and CEOs, means creating metrics that help measure the value of the security effort, Cavanagh says. In the study, The Conference Board found that the cost of business interruption was the most helpful metric, cited by almost 64 percent of respondents. That metric was followed by vulnerability assessments (60 percent), benchmarks against industry standards (49 percent), the value of the facilities (43.5 percent), and the level of insurance premiums (39 percent).

Face time is another important way to gain attention in mahogany row, the report says. In industries where there are critical infrastructure issues, such as financial services, about 66 percent of top executives meet at least once a month with their security director, according to the study. That figure dropped to around 44 percent in industries without critical infrastructure issues.

I guess it’s more confirmation of the conventional wisdom.

The full report is available, but it costs $125 if you’re something called a Conference Board associate, and $495 if you’re not. But my guess is that you’ve already heard everything that’s in it.

Posted on November 8, 2006 at 6:15 AMView Comments

The Zotob Worm and the DHS

On August 18 of last year, the Zotob worm badly infected computers at the Department of Homeland Security, particularly the 1,300 workstations running the US-VISIT application at border crossings. Wired News filed a Freedom of Information Act request for details, which was denied.

After we sued, CBP released three internal documents, totaling five pages, and a copy of Microsoft’s security bulletin on the plug-and-play vulnerability. Though heavily redacted, the documents were enough to establish that Zotob had infiltrated US-VISIT after CBP made the strategic decision to leave the workstations unpatched. Virtually every other detail was blacked out. In the ensuing court proceedings, CBP claimed the redactions were necessary to protect the security of its computers, and acknowledged it had an additional 12 documents, totaling hundreds of pages, which it withheld entirely on the same grounds.

U.S. District Judge Susan Illston reviewed all the documents in chambers, and ordered an additional four documents to be released last month. The court also directed DHS to reveal much of what it had previously hidden beneath thick black pen strokes in the original five pages.

“Although defendant repeatedly asserts that this information would render the CBP computer system vulnerable, defendant has not articulated how this general information would do so,” Illston wrote in her ruling (emphasis is lllston’s).

The details say nothing about the technical details of the computer systems, and only point to the incompetence of the DHS in handling the incident.

Details are in the Wired News article.

Posted on November 6, 2006 at 12:11 PMView Comments

Hacker-Controlled Computers Hiding Better

If you have control of a network of computers—by infecting them with some sort of malware—the hard part is controlling that network. Traditionally, these computers (called zombies) are controlled via IRC. But IRC can be detected and blocked, so the hackers have adapted:

Instead of connecting to an IRC server, newly compromised PCs connect to one or more Web sites to check in with the hackers and get their commands. These Web sites are typically hosted on hacked servers or computers that have been online for a long time. Attackers upload the instructions for download by their bots.

As a result, protection mechanisms, such as blocking IRC traffic, will fail. This could mean that zombies, which so far have mostly been broadband-connected home computers, will be created using systems on business networks.

The trick here is to not let the computer’s legitimate owner know that someone else is controlling it. It’s an arms race between attacker and defender.

Posted on October 25, 2006 at 12:14 PMView Comments

What is a Hacker?

A hacker is someone who thinks outside the box. It’s someone who discards conventional wisdom, and does something else instead. It’s someone who looks at the edge and wonders what’s beyond. It’s someone who sees a set of rules and wonders what happens if you don’t follow them. A hacker is someone who experiments with the limitations of systems for intellectual curiosity.

I wrote that last sentence in the year 2000, in my book Secrets and Lies. And I’m sticking to that definition.

This is what else I wrote in Secrets and Lies (pages 43-44):

Hackers are as old as curiosity, although the term itself is modern. Galileo was a hacker. Mme. Curie was one, too. Aristotle wasn’t. (Aristotle had some theoretical proof that women had fewer teeth than men. A hacker would have simply counted his wife’s teeth. A good hacker would have counted his wife’s teeth without her knowing about it, while she was asleep. A good bad hacker might remove some of them, just to prove a point.)

When I was in college, I knew a group similar to hackers: the key freaks. They wanted access, and their goal was to have a key to every lock on campus. They would study lockpicking and learn new techniques, trade maps of the steam tunnels and where they led, and exchange copies of keys with each other. A locked door was a challenge, a personal affront to their ability. These people weren’t out to do damage—stealing stuff wasn’t their objective—although they certainly could have. Their hobby was the power to go anywhere they wanted to.

Remember the phone phreaks of yesteryear, the ones who could whistle into payphones and make free phone calls. Sure, they stole phone service. But it wasn’t like they needed to make eight-hour calls to Manila or McMurdo. And their real work was secret knowledge: The phone network was a vast maze of information. They wanted to know the system better than the designers, and they wanted the ability to modify it to their will. Understanding how the phone system worked—that was the true prize. Other early hackers were ham-radio hobbyists and model-train enthusiasts.

Richard Feynman was a hacker; read any of his books.

Computer hackers follow these evolutionary lines. Or, they are the same genus operating on a new system. Computers, and networks in particular, are the new landscape to be explored. Networks provide the ultimate maze of steam tunnels, where a new hacking technique becomes a key that can open computer after computer. And inside is knowledge, understanding. Access. How things work. Why things work. It’s all out there, waiting to be discovered.

Computers are the perfect playground for hackers. Computers, and computer networks, are vast treasure troves of secret knowledge. The Internet is an immense landscape of undiscovered information. The more you know, the more you can do.

And it should be no surprise that many hackers have focused their skills on computer security. Not only is it often the obstacle between the hacker and knowledge, and therefore something to be defeated, but also the very mindset necessary to be good at security is exactly the same mindset that hackers have: thinking outside the box, breaking the rules, exploring the limitations of a system. The easiest way to break a security system is to figure out what the system’s designers hadn’t thought of: that’s security hacking.

Hackers cheat. And breaking security regularly involves cheating. It’s figuring out a smart card’s RSA key by looking at the power fluctuations, because the designers of the card never realized anyone could do that. It’s self-signing a piece of code, because the signature-verification system didn’t think someone might try that. It’s using a piece of a protocol to break a completely different protocol, because all previous security analysis only looked at protocols individually and not in pairs.

That’s security hacking: breaking a system by thinking differently.

It all sounds criminal: recovering encrypted text, fooling signature algorithms, breaking protocols. But honestly, that’s just the way we security people talk. Hacking isn’t criminal. All the examples two paragraphs above were performed by respected security professionals, and all were presented at security conferences.

I remember one conversation I had at a Crypto conference, early in my career. It was outside amongst the jumbo shrimp, chocolate-covered strawberries, and other delectables. A bunch of us were talking about some cryptographic system, including Brian Snow of the NSA. Someone described an unconventional attack, one that didn’t follow the normal rules of cryptanalysis. I don’t remember any of the details, but I remember my response after hearing the description of the attack.

“That’s cheating,” I said.

Because it was.

I also remember Brian turning to look at me. He didn’t say anything, but his look conveyed everything. “There’s no such thing as cheating in this business.”

Because there isn’t.

Hacking is cheating, and it’s how we get better at security. It’s only after someone invents a new attack that the rest of us can figure out how to defend against it.

For years I have refused to play the semantic “hacker” vs. “cracker” game. There are good hackers and bad hackers, just as there are good electricians and bad electricians. “Hacker” is a mindset and a skill set; what you do with it is a different issue.

And I believe the best computer security experts have the hacker mindset. When I look to hire people, I look for someone who can’t walk into a store without figuring out how to shoplift. I look for someone who can’t test a computer security program without trying to get around it. I look for someone who, when told that things work in a particular way, immediately asks how things stop working if you do something else.

We need these people in security, and we need them on our side. Criminals are always trying to figure out how to break security systems. Field a new system—an ATM, an online banking system, a gambling machine—and criminals will try to make an illegal profit off it. They’ll figure it out eventually, because some hackers are also criminals. But if we have hackers working for us, they’ll figure it out first—and then we can defend ourselves.

It’s our only hope for security in this fast-moving technological world of ours.

This essay appeared in the Summer 2006 issue of 2600.

Posted on September 14, 2006 at 7:13 AMView Comments

Is There Strategic Software?

If you define “critical infrastructure” as “things essential for the functioning of a society and economy,” then software is critical infrastructure. For many companies and individuals, if their computers stop working, they stop working.

It’s a situation that snuck up on us. Everyone knew that the software that flies 747s or targets cruise missiles was critical, but who thought of the airlines’ weight and balance computers, or the operating system running the databases and spreadsheets that determine which cruise missiles get shipped where?

And over the years, common, off-the-shelf, personal- and business-grade software has been used for more and more critical applications. Today we find ourselves in a situation where a well-positioned flaw in Windows, Cisco routers or Apache could seriously affect the economy.

It’s perfectly rational to assume that some programmers—a tiny minority I’m sure—are deliberately adding vulnerabilities and back doors into the code they write. I’m actually kind of amazed that back doors secretly added by the CIA/NSA, MI5, the Chinese, Mossad and others don’t conflict with each other. Even if these groups aren’t infiltrating software companies with back doors, you can be sure they’re scouring products for vulnerabilities they can exploit, if necessary. On the other hand, we’re already living in a world where dozens of new flaws are discovered in common software products weekly, and the economy is humming along. But we’re not talking about this month’s worm from Asia or new phishing software from the Russian mafia—we’re talking national intelligence organizations. “Infowar” is an overhyped term, but the next war will have a cyberspace component, and these organizations wouldn’t be doing their jobs if they weren’t preparing for it.

Marcus is 100 percent correct when he says it’s simply too late to do anything about it. The software industry is international, and no country can start demanding domestic-only software and expect to get anywhere. Nor would that actually solve the problem, which is more about the allegiance of millions of individual programmers than which country they happen to inhabit.

So, what to do? The key here is to remember the real problem: current commercial software practices are not secure enough to reliably detect and delete deliberately inserted malicious code. Once you understand this, you’ll drop the red herring arguments that led to CheckPoint not being able to buy Sourcefire and concentrate on the real solution: defense in depth.

In theory, security software are after-the-fact kludges because the underlying OS and apps are riddled with vulnerabilities. If your software were written properly, you wouldn’t need a firewall—right?

If we were to get serious about critical infrastructure, we’d recognize it’s all critical and start building security software to protect it. We’d build our security based on the principles of safe failure; we’d assume security would fail and make sure it’s OK when it does. We’d use defense in depth and compartmentalization to minimize the effects of failure. Basically, we’d do everything we’re supposed to do now to secure our networks.

It’d be expensive, probably prohibitively so. Maybe it would be easier to continue to ignore the problem, or at least manage geopolitics so that no national military wants to take us down.

This is the second half of a point/counterpoint I did with Marcus Ranum (here’s his half) for the September 2006 issue of Information Security Magazine.

Posted on September 12, 2006 at 10:38 AMView Comments

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Sidebar photo of Bruce Schneier by Joe MacInnis.