Entries Tagged "economics of security"

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Should Companies Do Most of Their Computing in the Cloud? (Part 1)

Yes. No. Yes. Maybe. Yes. Okay, it’s complicated.

The economics of cloud computing are compelling. For companies, the lower operating costs, the lack of capital expenditure, the ability to quickly scale and the ability to outsource maintenance are just some of the benefits. Computing is infrastructure, like cleaning, payroll, tax preparation and legal services. All of these are outsourced. And computing is becoming a utility, like power and water. Everyone does their power generation and water distribution “in the cloud.” Why should IT be any different?

Two reasons. The first is that IT is complicated: it is more like payroll services than like power generation. What this means is that you have to choose your cloud providers wisely, and make sure you have good contracts in place with them. You want to own your data, and be able to download that data at any time. You want assurances that your data will not disappear if the cloud provider goes out of business or discontinues your service. You want reliability and availability assurances, tech support assurances, whatever you need.

The downside is that you will have limited customization options. Cloud computing is cheaper because of economics of scale, and­—like any outsourced task—­you tend to get what you get. A restaurant with a limited menu is cheaper than a personal chef who can cook anything you want. Fewer options at a much cheaper price: it’s a feature, not a bug.

The second reason that cloud computing is different is security. This is not an idle concern. IT security is difficult under the best of circumstances, and security risks are one of the major reasons it has taken so long for companies to embrace the cloud. And here it really gets complicated.

On the pro-cloud side, cloud providers have the potential to be far more secure than the corporations whose data they are holding. It is the same economies of scale. For most companies, the cloud provider is likely to have better security than them­—by a lot. All but the largest companies benefit from the concentration of security expertise at the cloud provider.

On the anti-cloud side, the cloud provider might not meet your legal needs. You might have regulatory requirements that the cloud provider cannot meet. Your data might be stored in a country with laws you do not like­—or cannot legally use. Many foreign companies are thinking twice about putting their data inside America, because of laws allowing the government to get at that data in secret. Other countries around the world have even more draconian government-access rules.

Also on the anti-cloud side, a large cloud provider is a juicier target. Whether or not this matters depends on your threat profile. Criminals already steal far more credit card numbers than they can monetize; they are more likely to go after the smaller, less-defended networks. But a national intelligence agency will prefer the one-stop shop a cloud provider affords. That is why the NSA broke into Google’s data centers.

Finally, the loss of control is a security risk. Moving your data into the cloud means that someone else is controlling that data. This is fine if they do a good job, but terrible if they do not. And for free cloud services, that loss of control can be critical. The cloud provider can delete your data on a whim, if it believes you have violated some term of service that you never even knew existed. And you have no recourse.

As a business, you need to weigh the benefits against the risks. And that will depend on things like the type of cloud service you’re considering, the type of data that’s involved, how critical the service is, how easily you could do it in house, the size of your company and the regulatory environment, and so on.

This essay previously appeared on the Economist website, as part of a debate on cloud computing. It’s the first of three essays. Here are Parts 2 and 3. Visit the site for the other side of the debate and other commentary.

Posted on June 10, 2015 at 6:43 AM • View Comments

The Further Democratization of Stingray

Stingray is the code name for an IMSI-catcher, which is basically a fake cell phone tower sold by Harris Corporation to various law enforcement agencies. (It’s actually just one of a series of devices with fish names—Amberjack is another—but it’s the name used in the media.) What is basically does is trick nearby cell phones into connecting to it. Once that happens, the IMSI-catcher can collect identification and location information of the phones and, in some cases, eavesdrop on phone conversations, text messages, and web browsing. (IMSI stands for International Mobile Subscriber Identity, which is the unique serial number your cell phone broadcasts so that the cellular system knows where you are.)

The use of IMSI-catchers in the US used to be a massive police secret. The FBI is so scared of explaining this capability in public that the agency makes local police sign nondisclosure agreements before using the technique, and has instructed them to lie about their use of it in court. When it seemed possible that local police in Sarasota, Florida, might release documents about Stingray cell phone interception equipment to plaintiffs in civil rights litigation against them, federal marshals seized the documents. More recently, St. Louis police dropped a case rather than talk about the technology in court. And Baltimore police admitted using Stingray over 25,000 times.

The truth is that it’s no longer a massive police secret. We now know a lot about IMSI-catchers. And the US government does not have a monopoly over the use of IMSI-catchers. I wrote in Data and Goliath:

There are dozens of these devices scattered around Washington, DC, and the rest of the country run by who-knows-what government or organization. Criminal uses are next.

From the Washington Post:

How rife? Turner and his colleagues assert that their specially outfitted smartphone, called the GSMK CryptoPhone, had detected signs of as many as 18 IMSI catchers in less than two days of driving through the region. A map of these locations, released Wednesday afternoon, looks like a primer on the geography of Washington power, with the surveillance devices reportedly near the White House, the Capitol, foreign embassies and the cluster of federal contractors near Dulles International Airport.

At the RSA Conference last week, Pwnie Express demonstrated their IMSI-catcher detector.

Building your own IMSI-catcher isn’t hard or expensive. At Def Con in 2010, researcher Chris Paget (now Kristin Paget) demonstrated a homemade IMSI-catcher. The whole thing cost $1,500, which is cheap enough for both criminals and nosy hobbyists.

It’s even cheaper and easier now. Anyone with a HackRF software-defined radio card can turn their laptop into an amateur IMSI-catcher. And this is why companies are building detectors into their security monitoring equipment.

Two points here. The first is that the FBI should stop treating Stingray like it’s a big secret, so we can start talking about policy.

The second is that we should stop pretending that this capability is exclusive to law enforcement, and recognize that we’re all at risk because of it. If we continue to allow our cellular networks to be vulnerable to IMSI-catchers, then we are all vulnerable to any foreign government, criminal, hacker, or hobbyist that builds one. If we instead engineer our cellular networks to be secure against this sort of attack, then we are safe against all those attackers.

Me:

We have one infrastructure. We can’t choose a world where the US gets to spy and the Chinese don’t. We get to choose a world where everyone can spy, or a world where no one can spy. We can be secure from everyone, or vulnerable to anyone.

Like QUANTUM, we have the choice of building our cellular infrastructure for security or for surveillance. Let’s choose security.

EDITED TO ADD (5/2): Here’s an IMSI catcher for sale on alibaba.com. At this point, every dictator in the world is using this technology against its own citizens. They’re used extensively in China to send SMS spam without paying the telcos any fees. On a Food Network show called Mystery Diners—episode 108, “Cabin Fever”—someone used an IMSI catcher to intercept a phone call between two restaurant employees.

The new model of the IMSI catcher from Harris Corporation is called Hailstorm. It has the ability to remotely inject malware into cell phones. Other Harris IMSI-catcher codenames are Kingfish, Gossamer, Triggerfish, Amberjack and Harpoon. The competitor is DRT, made by the Boeing subsidiary Digital Receiver Technology, Inc.

EDITED TO ADD (5/2): Here’s an IMSI catcher called Piranha, sold by the Israeli company Rayzone Corp. It claims to work on GSM 2G, 3G, and 4G networks (plus CDMA, of course). The basic Stingray only works on GSM 2G networks, and intercepts phones on the more modern networks by forcing them to downgrade to the 2G protocols. We believe that the more modern ISMI catchers also work against 3G and 4G networks.

EDITED TO ADD (5/13): The FBI recently released more than 5,000 pages of documents about Stingray, but nearly everything is redacted.

Posted on April 27, 2015 at 6:27 AM • View Comments

Metal Detectors at Sports Stadiums

Fans attending Major League Baseball games are being greeted in a new way this year: with metal detectors at the ballparks. Touted as a counterterrorism measure, they’re nothing of the sort. They’re pure security theater: They look good without doing anything to make us safer. We’re stuck with them because of a combination of buck passing, CYA thinking, and fear.

As a security measure, the new devices are laughable. The ballpark metal detectors are much more lax than the ones at an airport checkpoint. They aren’t very sensitive—people with phones and keys in their pockets are sailing through—and there are no X-ray machines. Bags get the same cursory search they’ve gotten for years. And fans wanting to avoid the detectors can opt for a “light pat-down search” instead.

There’s no evidence that this new measure makes anyone safer. A halfway competent ticketholder would have no trouble sneaking a gun into the stadium. For that matter, a bomb exploded at a crowded checkpoint would be no less deadly than one exploded in the stands. These measures will, at best, be effective at stopping the random baseball fan who’s carrying a gun or knife into the stadium. That may be a good idea, but unless there’s been a recent spate of fan shootings and stabbings at baseball games—and there hasn’t—this is a whole lot of time and money being spent to combat an imaginary threat.

But imaginary threats are the only ones baseball executives have to stop this season; there’s been no specific terrorist threat or actual intelligence to be concerned about. MLB executives forced this change on ballparks based on unspecified discussions with the Department of Homeland Security after the Boston Marathon bombing in 2013. Because, you know, that was also a sporting event.

This system of vague consultations and equally vague threats ensure that no one organization can be seen as responsible for the change. MLB can claim that the league and teams “work closely” with DHS. DHS can claim that it was MLB’s initiative. And both can safely relax because if something happens, at least they did something.

It’s an attitude I’ve seen before: “Something must be done. This is something. Therefore, we must do it.” Never mind if the something makes any sense or not.

In reality, this is CYA security, and it’s pervasive in post-9/11 America. It no longer matters if a security measure makes sense, if it’s cost-effective or if it mitigates any actual threats. All that matters is that you took the threat seriously, so if something happens you won’t be blamed for inaction. It’s security, all right—security for the careers of those in charge.

I’m not saying that these officials care only about their jobs and not at all about preventing terrorism, only that their priorities are skewed. They imagine vague threats, and come up with correspondingly vague security measures intended to address them. They experience none of the costs. They’re not the ones who have to deal with the long lines and confusion at the gates. They’re not the ones who have to arrive early to avoid the messes the new policies have caused around the league. And if fans spend more money at the concession stands because they’ve arrived an hour early and have had the food and drinks they tried to bring along confiscated, so much the better, from the team owners’ point of view.

I can hear the objections to this as I write. You don’t know these measures won’t be effective! What if something happens? Don’t we have to do everything possible to protect ourselves against terrorism?

That’s worst-case thinking, and it’s dangerous. It leads to bad decisions, bad design and bad security. A better approach is to realistically assess the threats, judge security measures on their effectiveness and take their costs into account. And the result of that calm, rational look will be the realization that there will always be places where we pack ourselves densely together, and that we should spend less time trying to secure those places and more time finding terrorist plots before they can be carried out.

So far, fans have been exasperated but mostly accepting of these new security measures. And this is precisely the problem—most of us don’t care all that much. Our options are to put up with these measures, or stay home. Going to a baseball game is not a political act, and metal detectors aren’t worth a boycott. But there’s an undercurrent of fear as well. If it’s in the name of security, we’ll accept it. As long as our leaders are scared of the terrorists, they’re going to continue the security theater. And we’re similarly going to accept whatever measures are forced upon us in the name of security. We’re going to accept the National Security Agency’s surveillance of every American, airport security procedures that make no sense and metal detectors at baseball and football stadiums. We’re going to continue to waste money overreacting to irrational fears.

We no longer need the terrorists. We’re now so good at terrorizing ourselves.

This essay previously appeared in the Washington Post.

Posted on April 15, 2015 at 6:58 AM • View Comments

The Changing Economics of Surveillance

Cory Doctorow examines the changing economics of surveillance and what it means:

The Stasi employed one snitch for every 50 or 60 people it watched. We can’t be sure of the size of the entire Five Eyes global surveillance workforce, but there are only about 1.4 million Americans with Top Secret clearance, and many of them don’t work at or for the NSA, which means that the number is smaller than that (the other Five Eyes states have much smaller workforces than the US). This million-ish person workforce keeps six or seven billion people under surveillance—a ratio approaching 1:10,000. What’s more, the US has only (“only”!) quadrupled its surveillance budget since the end of the Cold War: tooling up to give the spies their toys wasn’t all that expensive, compared to the number of lives that gear lets them pry into.

IT has been responsible for a 2-3 order of magnitude productivity gain in surveillance efficiency. The Stasi used an army to surveil a nation; the NSA uses a battalion to surveil a planet.

I am reminded of this paper on the changing economics of surveillance.

Posted on March 12, 2015 at 6:22 AM • View Comments

Economic Failures of HTTPS Encryption

Interesting paper: “Security Collapse of the HTTPS Market.” From the conclusion:

Recent breaches at CAs have exposed several systemic vulnerabilities and market failures inherent in the current HTTPS authentication model: the security of the entire ecosystem suffers if any of the hundreds of CAs is compromised (weakest link); browsers are unable to revoke trust in major CAs (“too big to fail”); CAs manage to conceal security incidents (information asymmetry); and ultimately customers and end users bear the liability and damages of security incidents (negative externalities).

Understanding the market and value chain for HTTPS is essential to address these systemic vulnerabilities. The market is highly concentrated, with very large price differences among suppliers and limited price competition. Paradoxically, the current vulnerabilities benefit rather than hurt the dominant CAs, because among others, they are too big to fail.

Posted on November 28, 2014 at 6:26 AM • View Comments

Paying People to Infect their Computers

Research paper: “It’s All About The Benjamins: An empirical study on incentivizing users to ignore security advice,” by Nicolas Christin, Serge Egelman, Timothy Vidas, and Jens Grossklags.

Abstract: We examine the cost for an attacker to pay users to execute arbitrary code—potentially malware. We asked users at home to download and run an executable we wrote without being told what it did and without any way of knowing it was harmless. Each week, we increased the payment amount. Our goal was to examine whether users would ignore common security advice—not to run untrusted executables­—if there was a direct incentive, and how much this incentive would need to be. We observed that for payments as low as $0.01, 22% of the people who viewed the task ultimately ran our executable. Once increased to $1.00, this proportion increased to 43%. We show that as the price increased, more and more users who understood the risks ultimately ran the code. We conclude that users are generally unopposed to running programs of unknown provenance, so long as their incentives exceed their inconvenience.

The experiment was run on Mechanical Turk, which means we don’t know who these people were or even if they were sitting at computers they owned (as opposed to, say, computers at an Internet cafe somewhere). But if you want to build a fair-trade botnet, this is a reasonable way to go about it.

Two articles.

Posted on June 19, 2014 at 6:28 AM • View Comments

Chinese Hacking of the US

Chinese hacking of American computer networks is old news. For years we’ve known about their attacks against U.S. government and corporate targets. We’ve seen detailed reports of how they hacked The New York Times. Google has detected them going after Gmail accounts of dissidents. They’ve built sophisticated worldwide eavesdropping networks. These hacks target both military secrets and corporate intellectual property. They’re perpetrated by a combination of state, state-sponsored and state-tolerated hackers. It’s been going on for years.

On Monday, the Justice Department indicted five Chinese hackers in absentia, all associated with the Chinese military, for stealing corporate secrets from U.S. energy, metals and manufacturing companies. It’s entirely for show; the odds that the Chinese are going to send these people to the U.S. to stand trial is zero. But it does move what had been mostly a technical security problem into the world of diplomacy and foreign policy. By doing this, the U.S. government is taking a very public stand and saying “enough.”

The problem with that stand is that we’ve been doing much the same thing to China. Documents revealed by the whistleblower Edward Snowden show that the NSA has penetrated Chinese government and commercial networks, and is exfiltrating—that’s NSA talk for stealing—an enormous amount of secret data. We’ve hacked the networking hardware of one of their own companies, Huawei. We’ve intercepted networking equipment being sent there and installed monitoring devices. We’ve been listening in on their private communications channels.

The only difference between the U.S. and China’s actions is that the U.S. doesn’t engage in direct industrial espionage. That is, we don’t steal secrets from Chinese companies and pass them directly to U.S. competitors. But we do engage in economic espionage; we steal secrets from Chinese companies for an advantage in government trade negotiations, which directly benefits U.S. competitors. We might think this difference is important, but other countries are not as as impressed with our nuance.

Already the Chinese are retaliating against the U.S. actions with rhetoric of their own. I don’t know the Chinese expression for ‘pot calling the kettle black,’ but it certainly fits in this case.

Again, none of this is new. The U.S. and the Chinese have been conducting electronic espionage on each other throughout the Cold War, and there’s no reason to think it’s going to change anytime soon. What’s different now is the ease with which the two countries can do this safely and remotely, over the Internet, as well as the massive amount of information that can be stolen with a few computer commands.

On the Internet today, it is much easier to attack systems and break into them than it is to defend those systems against attack, so the advantage is to the attacker. This is true for a combination of reasons: the ability of an attacker to concentrate his attack, the nature of vulnerabilities in computer systems, poor software quality and the enormous complexity of computer systems.

The computer security industry is used to coping with criminal attacks. In general, such attacks are untargeted. Criminals might have broken into Target’s network last year and stolen 40 million credit and debit card numbers, but they would have been happy with any retailer’s large credit card database. If Target’s security had been better than its competitors, the criminals would have gone elsewhere. In this way, security is relative.

The Chinese attacks are different. For whatever reason, the government hackers wanted certain information inside the networks of Alcoa World Alumina, Westinghouse Electric, Allegheny Technologies, U.S. Steel, United Steelworkers Union and SolarWorld. It wouldn’t have mattered how those companies’ security compared with other companies; all that mattered was whether it was better than the ability of the attackers.

This is a fundamentally different security model—often called APT or Advanced Persistent Threat—and one that is much more difficult to defend against.

In a sense, American corporations are collateral damage in this battle of espionage between the U.S. and China. Taking the battle from the technical sphere into the foreign policy sphere might be a good idea, but it will work only if we have some moral high ground from which to demand that others not spy on us. As long as we run the largest surveillance network in the world and hack computer networks in foreign countries, we’re going to have trouble convincing others not to attempt the same on us.

This essay previously appeared on Time.com.

Posted on June 2, 2014 at 6:37 AM • View Comments

The Economics of Bulk Surveillance

Ross Anderson has an important new paper on the economics that drive government-on-population bulk surveillance:

My first big point is that all the three factors which lead to monopoly – network effects, low marginal costs and technical lock-in – are present and growing in the national-intelligence nexus itself. The Snowden papers show that neutrals like Sweden and India are heavily involved in information sharing with the NSA, even though they have tried for years to pretend otherwise. A non-aligned country such as India used to be happy to buy warplanes from Russia; nowadays it still does, but it shares intelligence with the NSA rather then the FSB. If you have a choice of joining a big spy network like America’s or a small one like Russia’s then it’s like choosing whether to write software for the PC or the Mac back in the 1990s. It may be partly an ideological choice, but the economics can often be stronger than the ideology.

Second, modern warfare, like the software industry, has seen the bulk of its costs turn from variable costs into fixed costs. In medieval times, warfare was almost entirely a matter of manpower, and society was organised appropriately; as well as rent or produce, tenants owed their feudal lord forty days’ service in peacetime, and sixty days during a war. Barons held their land from the king in return for an oath of fealty, and a duty to provide a certain size of force on demand; priests and scholars paid a tax in lieu of service, so that a mercenary could be hired in their place. But advancing technology brought steady industrialisation. When the UK and the USA attacked Germany in 1944, we did not send millions of men to Europe, as in the first world war, but a combat force of a couple of hundred thousand troops – though with thousands of tanks and backed by larger numbers of men in support roles in tens of thousands of aircraft and ships. Nowadays the transition from labour to capital has gone still further: to kill a foreign leader, we could get a drone fire a missile that costs $30,000. But that’s backed by colossal investment – the firms whose data are tapped by PRISM have a combined market capitalisation of over $1 trillion.

Third is the technical lock-in, which operates at a number of levels. First, there are lock-in effects in the underlying industries, where (for example) Cisco dominates the router market: those countries that have tried to build US-free information infrastructures (China) or even just government information infrastructures (Russia, Germany) find it’s expensive. China went to the trouble of sponsoring an indigenous vendor, Huawei, but it’s unclear how much separation that buys them because of the common code shared by router vendors: a vulnerability discovered in one firm’s products may affect another. Thus the UK government lets BT buy Huawei routers for all but its network’s most sensitive parts (the backbone and the lawful-intercept functions). Second, technical lock-in affects the equipment used by the intelligence agencies themselves, and is in fact promoted by the agencies via ETSI standards for functions such as lawful intercept.

Just as these three factors led to the IBM network dominating the mainframe age, the Intel/Microsoft network dominating the PC age, and Facebook dominating the social networking scene, so they push strongly towards global surveillance becoming a single connected ecosystem.

These are important considerations when trying to design national policies around surveillance.

Ross’s blog post.

Posted on May 27, 2014 at 10:13 AM • View Comments

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Sidebar photo of Bruce Schneier by Joe MacInnis.