Entries Tagged "NIST"

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Calculating the Benefits of the Advanced Encryption Standard

NIST has completed a study—it was published last year, but I just saw it recently—calculating the costs and benefits of the Advanced Encryption Standard.

From the conclusion:

The result of performing that operation on the series of cumulated benefits extrapolated for the 169 survey respondents finds that present value of benefits from today’s perspective is approximately $8.9 billion. On the other hand, the present value of NIST’s costs from today’s perspective is $127 million. Thus, the NPV from today’s perspective is $8,772,000,000; the B/C ratio is therefore 70.2/1; and a measure (explained in detail in Section 6.1) of the IRR for the alternative investment perspective is 31%; all are indicators of a substantial economic impact.

Extending the approach of looking back from 2017 to the larger national economy required the selection of economic sectors best represented by the 169 survey respondents. The economic sectors represented by ten or more survey respondents include the following: agriculture; construction; manufacturing; retail trade; transportation and warehousing; information; real estate rental and leasing; professional, scientific, and technical services; management services; waste management; educational services; and arts and entertainment. Looking at the present value of benefits and costs from 2017’s perspective for these economic sectors finds that the present value of benefits rises to approximately $251 billion while the present value of NIST’s costs from today’s perspective remains the same at $127 million. Therefore, the NPV of the benefits of the AES program to the national economy from today’s perspective is $250,473,200,000; the B/C ratio is roughly 1976/1; and the appropriate, alternative (explained in Section 6.1) IRR and investing proceeds at the social rate of return is 53.6%.

The report contains lots of facts and figures relevant to crypto policy debates, including the chaotic nature of crypto markets in the mid-1990s, the number of approved devices and libraries of various kinds since then, other standards that invoke AES, and so on.

There’s a lot to argue with about the methodology and the assumptions. I don’t know if I buy that the benefits of AES to the economy are in the billions of dollars, mostly because we in the cryptographic community would have come up with alternative algorithms to triple-DES that would have been accepted and used. Still, I like seeing this kind of analysis about security infrastructure. Security is an enabling technology; it doesn’t do anything by itself, but instead allows all sorts of things to be done. And I certainly agree that the benefits of a standardized encryption algorithm that we all trust and use outweigh the cost by orders of magnitude.

And this isn’t the first time NIST has conducted economic impact studies. It released a study of the economic impact of DES in 2001.

Posted on October 22, 2019 at 5:56 AM • View Comments

NIST Issues Call for "Lightweight Cryptography" Algorithms

This is interesting:

Creating these defenses is the goal of NIST’s lightweight cryptography initiative, which aims to develop cryptographic algorithm standards that can work within the confines of a simple electronic device. Many of the sensors, actuators and other micromachines that will function as eyes, ears and hands in IoT networks will work on scant electrical power and use circuitry far more limited than the chips found in even the simplest cell phone. Similar small electronics exist in the keyless entry fobs to newer-model cars and the Radio Frequency Identification (RFID) tags used to locate boxes in vast warehouses.

All of these gadgets are inexpensive to make and will fit nearly anywhere, but common encryption methods may demand more electronic resources than they possess.

The NSA’s SIMON and SPECK would certainly qualify.

Posted on May 2, 2018 at 6:40 AM • View Comments

Changes in Password Best Practices

NIST recently published its four-volume SP800-63b Digital Identity Guidelines. Among other things, it makes three important suggestions when it comes to passwords:

  1. Stop it with the annoying password complexity rules. They make passwords harder to remember. They increase errors because artificially complex passwords are harder to type in. And they don’t help that much. It’s better to allow people to use pass phrases.
  2. Stop it with password expiration. That was an old idea for an old way we used computers. Today, don’t make people change their passwords unless there’s indication of compromise.
  3. Let people use password managers. This is how we deal with all the passwords we need.

These password rules were failed attempts to fix the user. Better we fix the security systems.

Posted on October 10, 2017 at 6:19 AM • View Comments

The Cost of Cyberattacks Is Less than You Might Think

Interesting research from Sasha Romanosky at RAND:

Abstract: In 2013, the US President signed an executive order designed to help secure the nation’s critical infrastructure from cyberattacks. As part of that order, he directed the National Institute for Standards and Technology (NIST) to develop a framework that would become an authoritative source for information security best practices. Because adoption of the framework is voluntary, it faces the challenge of incentivizing firms to follow along. Will frameworks such as that proposed by NIST really induce firms to adopt better security controls? And if not, why? This research seeks to examine the composition and costs of cyber events, and attempts to address whether or not there exist incentives for firms to improve their security practices and reduce the risk of attack. Specifically, we examine a sample of over 12 000 cyber events that include data breaches, security incidents, privacy violations, and phishing crimes. First, we analyze the characteristics of these breaches (such as causes and types of information compromised). We then examine the breach and litigation rate, by industry, and identify the industries that incur the greatest costs from cyber events. We then compare these costs to bad debts and fraud within other industries. The findings suggest that public concerns regarding the increasing rates of breaches and legal actions may be excessive compared to the relatively modest financial impact to firms that suffer these events. Public concerns regarding the increasing rates of breaches and legal actions, conflict, however, with our findings that show a much smaller financial impact to firms that suffer these events. Specifically, we find that the cost of a typical cyber incident in our sample is less than $200 000 (about the same as the firm’s annual IT security budget), and that this represents only 0.4% of their estimated annual revenues.

The result is that it often makes business sense to underspend on cybersecurity and just pay the costs of breaches:

Romanosky analyzed 12,000 incident reports and found that typically they only account for 0.4 per cent of a company’s annual revenues. That compares to billing fraud, which averages at 5 per cent, or retail shrinkage (ie, shoplifting and insider theft), which accounts for 1.3 per cent of revenues.

As for reputational damage, Romanosky found that it was almost impossible to quantify. He spoke to many executives and none of them could give a reliable metric for how to measure the PR cost of a public failure of IT security systems.

He also noted that the effects of a data incident typically don’t have many ramifications on the stock price of a company in the long term. Under the circumstances, it doesn’t make a lot of sense to invest too much in cyber security.

What’s being left out of these costs are the externalities. Yes, the costs to a company of a cyberattack are low to them, but there are often substantial additional costs borne by other people. The way to look at this is not to conclude that cybersecurity isn’t really a problem, but instead that there is a significant market failure that governments need to address.

Posted on September 29, 2016 at 6:51 AM • View Comments

NIST Starts Planning for Post-Quantum Cryptography

Last year, the NSA announced its plans for transitioning to cryptography that is resistant to a quantum computer. Now, it’s NIST’s turn. Its just-released report talks about the importance of algorithm agility and quantum resistance. Sometime soon, it’s going to have a competition for quantum-resistant public-key algorithms:

Creating those newer, safer algorithms is the longer-term goal, Moody says. A key part of this effort will be an open collaboration with the public, which will be invited to devise and vet cryptographic methods that—to the best of experts’ knowledge—­will be resistant to quantum attack. NIST plans to launch this collaboration formally sometime in the next few months, but in general, Moody says it will resemble past competitions such as the one for developing the SHA-3 hash algorithm, used in part for authenticating digital messages.

“It will be a long process involving public vetting of quantum-resistant algorithms,” Moody said. “And we’re not expecting to have just one winner. There are several systems in use that could be broken by a quantum computer­—public-key encryption and digital signatures, to take two examples­—and we will need different solutions for each of those systems.”

The report rightly states that we’re okay in the symmetric cryptography world; the key lengths are long enough.

This is an excellent development. NIST has done an excellent job with their previous cryptographic standards, giving us a couple of good, strong, well-reviewed, and patent-free algorithms. I have no doubt this process will be equally excellent. (If NIST is keeping a list, aside from post-quantum public-key algorithms, I would like to see competitions for a larger-block-size block cipher and a super-fast stream cipher as well.)

Two news articles.

Posted on May 9, 2016 at 6:19 AM • View Comments

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Sidebar photo of Bruce Schneier by Joe MacInnis.