Posts Tagged ‘information technology’

Germany, France to mastermind European data network – bypassing US

February 16, 2014

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Germany's Chancellor Angela Merkel and France's President Francois Hollande (R) (Reuters / Francois Lenoir)

Germany’s Chancellor Angela Merkel and France’s President Francois Hollande (R) (Reuters / Francois Lenoir)

Angela Merkel and Francois Hollande will review plans to build up a trustworthy data protection network in Europe. The challenge is to avoid data passing through the US after revelations of mass NSA spying in Germany and France.

Merkel has been one of the biggest supporters of greater data  protection in Europe since the revelations that the US tapped her  phone emerged in a Der Spiegel news report in October, based on  information leaked by former NSA contractor Edward Snowden.

Earlier, France learned from reports in Le Monde that the NSA has  also been recording dozens of millions of French phone calls,  including those of the French authorities. According to the  report, in just one month between December 10, 2012 and January  8, 2013, the NSA recorded a total of 70.3 million French phone  calls.

Meanwhile, according to the Snowden revelations, the German  Chancellor’s mobile phone has been on an NSA target list since  2002 and was codenamed “GE Chancellor Merkel.” The  monitoring operation was allegedly still in force even a few  weeks before US President Barack Obama’s visit to Berlin in June  2013.

Washington has denied it monitored Merkel’s personal phone,  insisting that its surveillance practices are focused on threats  to national security, namely terrorism. Merkel, who grew up in  East Germany, where phone tapping was common practice, compared the NSA’s spying to that of the Stasi  secret police in the former German Democratic Republic, and  accused the US of a grave breach of trust. According to polls,  the Germans have lost confidence in the US as a trustworthy  partner, and a majority of Germans consider Edward Snowden a  hero. It’s believed that his revelations have hit Berlin  particularly hard since Germany is not a member of the so-called   “Five Eyes’ intelligence alliance which includes NSA-equivalent  agencies in the UK, Canada, Australia and New Zealand, exchanging  intelligence with each other on a regular basis.

In the wake of the revelations about US global spying activities,  the German government has made it mandatory for ministers to use   encryption on their phones to secure their  communications against intrusion. Berlin has also prohibited the  use of iPhones for official business, as they are not compatible  with encryption.

France and Germany have been seeking bilateral talks with the  United States to discuss the issue of the snooping, with Merkel’s  government pressing for a “no spying” agreement with Washington.  Negotiations on an anti-spying agreement began in August 2013,  but the US has been reluctant to sign such a deal, Süddeutsche  Zeitung reported in mid-January, citing a Federal Intelligence  Service (BND) employee as saying: “We’re getting nothing.”

Merkel, who is due to visit France on Wednesday, said in her  weekly podcast that she disapproved of companies such as Google  and Facebook, basing their operations in countries with low  levels of data protection, while in reality being active in  countries with high data protection.

“Above all, we’ll talk about European providers that offer  security for our citizens, so that one shouldn’t have to send  emails and other information across the Atlantic. Rather, one  could build up a communication network inside Europe,” she  said.

Hollande’s office said France agrees with Berlin’s proposals,  Reuters reported, citing an official as saying: “Now that the  German government is formed, it is important that we take up the  initiative together.”

Press freedom in the United States has suffered “one of the most significant declines” ever — US down in World Press Freedom Index

February 16, 2014

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Reuters / Gary Cameron

Reuters / Gary Cameron

Press freedom in the United States has suffered “one of the most significant declines” in the last year after sacrificing information to national security, with the NSA surveillance scandal topping the list of wrongdoing.

That’s according to The  World Press Freedom Index for 2014 from Reporters Without  Borders (RWB), which put the US in 46th place out of 180  countries, a 13-place drop from last year.

This time American misdemeanors were in the report’s chapter on   “Information sacrificed to national security and  surveillance,” which says: “Countries that pride  themselves on being democracies and respecting the rule of law”   too often sacrifice the freedom of speech to “an overly broad and  abusive interpretation of national security needs.”

“Investigative journalism often suffers as a result” of  a “disturbing retreat from democratic practices,” the  RWB report said.

The RWB recalled all recent major assaults on the freedom of  press in the US, be it the conviction of US Army whistleblower Bradley  (Chelsea) Manning or the manhunt for former NSA contractor Edward Snowden,  whose revelations about pervasive worldwide surveillance  conducted by the US intelligence’s made WikiLeaks publications of Manning’s files pale by  comparison.

Another notorious attack on journalism mentioned by the RWB was  the seizure of “thousands and thousands” of Associated  Press phone calls by the US Justice Department, which was  searching for a leak in the CIA.

The RWB recalled scandalous cases of freelance digital journalist  Barrett Brown, who now faces 105 years in prison for sharing a link  to stolen classified data, and New York Times reporter James  Risen, who also faces a term in jail if he does not testify against CIA whistleblower Jeffrey  Sterling.

Throughout 2013 a number of US journalists have been issued with  subpoenas and pressured to reveal off-the-record sources they  relied upon, which prompted some activists to call for a media shield law to protect journalists’ sources and  thousands of internet-involved organizations to organize protest against massive electronic  surveillance.

In 2012, the US fell even lower, to 47th position, after tumbling  27 positions – a result of a series of arrests of high-profile  journalists during the Occupy Wall Street protests.

Freedom of speech in Britain, a close US ally, by comparison, was  viewed as less restricted, with the country in 33rd place. The UK  fell back three places after the exposure of deep collaboration  between American and British security and intelligence services  in suppressing the freedom of the press.

While UK’s Government Communications Headquarters (GCHQ) agency  actually taught American NSA how to conduct online espionage,  Britain has been evaluated quite mildly, only suffering a minor  decline in the index. The only incident mentioned by the RWB was  the detention of David Miranda, the partner of  ex-Guardian journalist Glenn Greenwald who revealed NSA spy  programs.

RWB did not considered the most recent revelation about British  intelligence, found practicing not just spying but actively using   cyber-attacks to deal with such information  disseminators as Anonymous and LulzSec hacktivists, or that global media watchdogs are  planning to investigate press freedom in the UK.

Also, Glenn Greenwald’s revelations about UK and US mainstream  media being “devoted servants” of the intelligence  agencies seemingly have not affected the rating.

Meanwhile WikiLeaks founder Julian Assange is still trapped in the Ecuadorian embassy in London,  with the freedom of information campaigner still being pursued by  UK and Swedish justice.

In the 2014 RWB index, Russia was placed 148th, the same as in  last year’s ranking. Though praising “the resistance of civil  society” in the country, the report still accuses Moscow of  “using UN bodies and regional alliances such as the Shanghai  Cooperation Organization in its efforts to undermine  international standards on freedom of information.”

President Obama’s NSA ‘Ruse’ — With congress and the voters off his back, now he can do next to nothing

January 21, 2014
U.S. President Barack Obama is seen through a teleprompter as he speaks about the National Security Agency from the Justice Department in Washington January 17, 2014. (Reuters/Kevin Lamarque).
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U.S. President Barack Obama is seen through a teleprompter as he speaks about the National Security Agency from the Justice Department in Washington January 17, 2014. (Reuters/Kevin Lamarque)
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By Sam Sacks
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We were all looking at the president’s speech the wrong way.

It was billed as a major speech on reform to the nation’s  intelligence programs. But although some genuine reforms were  introduced, the speech really wasn’t about reform. It was about  saving the NSA’s most controversial tactic, as revealed by Edward  Snowden, which is to “collect it all.” Build the  haystack, and then find the needle.

Of all the Snowden disclosures thus far, it’s the very first one  that’s still most significant: the NSA is running a domestic  spying program based on the collection and storage of virtually  all Americans’ telephone metadata.

The White House and spy chiefs deny it is a domestic spy program   – a denial the President reiterated in his ‘reform’   speech. But their denials are belied by former CIA Director  Michael Morrell, a member of the president’s own NSA review  panel, who admitted to the Senate Judiciary Committee a few days  before the speech, “There is quite a bit of content in  metadata. When you have the records of the phone calls that a  particular individual made, you can learn an awful lot about that  person.”

But here’s the thing about that program: it has an expiration  date – something the White House was keenly aware of heading into  the ‘reform’ speech.

Just as the telephone spying program is the most jaw-dropping NSA  disclosure; it’s also the program most in peril. Already one  federal court has ruled it likely unconstitutional. Back in July,  the House of Representatives came within a handful of votes of  killing the program – and that was before an entire autumn and  now winter of more disclosures.

A prominent coalition of powerful Senators on both sides of the  aisle is pushing to end the program, too. So there are a lot of  pitchforks pointed at it.

Then there’s June 1, 2015, when Section 215 of the Patriot Act,  which underpins the NSA’s telephone spying program, expires.  Congress may not have the votes today to kill the telephone  spying program. But, thanks to Edward Snowden, Congress almost  certainly doesn’t have the votes next year to renew it either.

So that’s what President Obama, a fierce defender of the  telephone spying program and Commander in Chief of the nation’s  intelligence operations, was facing when he stepped to the podium  in the Department of Justice’s Great Hall. And it’s why his   ‘reform’ speech that followed was actually a Trojan horse  containing a last-ditch effort to save the NSA’s “collect it all”   telephone spying program.

Reuters/Kai Pfaffenbach.
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Reuters/Kai Pfaffenbach

A convenient distinction

Yes, the president said he is, “ordering a transition that  will end the Section 215 bulk metadata program as it currently  exists.” But he didn’t do that. Instead he took the primary  concern of NSA critics, which is the collection and storage of  Americans telephone data, and severed it in two, by focusing  strictly on the storage of that data – not the collection of it.

He pushed for a tinkering of the program that would retain the  bulk collection of Americans’ telephone (meta)data, but,   “without the government holding this bulk metadata.”   Instead, private telecoms or some sort of “third party”   would retain the databases. It’s up to the attorney general, the  intelligence community, and Congress ultimately to figure out how  to make it work, which could be difficult since the telecoms  don’t want this responsibility and it’s hard to imagine a  trustworthy “third party” capable of retaining these  databases, short of the ACLU or Electronic Frontier Foundation.

However, the important thing to remember is, no matter who’s  holding the databases, those databases are still being filled  with nearly every single American’s phone data. The government  may have to deal with more restricted access to these databases  in the short-term, and lose ownership of them altogether in the  long-term, but indiscriminate bulk collection will continue  indefinitely.

This convenient distinction wasn’t lost on those who know the NSA  best and have blown the whistle on it. Speaking at the National  Press Club within an hour of the President’s ‘reform’ speech, NSA  whistleblower Kirk Wiebe called it a “ruse,” adding,   “It’s not where the data is. It’s a red-herring to say if the  NSA doesn’t have it, it’s safe. Not true.”

Another NSA whistleblower, Bill Binney, criticized the speech  saying that any approach that “still maintains bulk  collection is the wrong way to do it.” Yet that’s exactly  the approach President Obama took – with good reason.

U.S. President Barack Obama speaks about the National Security Agency from the Justice Department in Washington January 17, 2014. (Reuters/Kevin Lamarque).
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U.S. President Barack Obama speaks about the National Security Agency from the Justice Department in Washington January 17, 2014. (Reuters/Kevin Lamarque)

Cut off one hand to save the other

When US District Court Judge Richard Leon ruled against the  telephone spying program, he argued, “I cannot imagine a more   ‘indiscriminate’ and ‘arbitrary invasion’ than this systematic  and high-tech collection and retention of personal data on  virtually every single citizen for purposes of querying it and  analyzing it without judicial approval.”

His key words: “collection and retention.” Does Judge  Leon rule the same way if the ‘retention’ is taken out of the  picture? That’s the gamble President Obama is making. By slicing  off the NSA’s left hand of bulk retention, President Obama may  just be able to save the right hand of bulk collection moving  forward.

Not only might he have gotten the courts off his back by  disavowing government storage of bulk data collection, but  President Obama may have got Congress off his back, too. In the  Senate, the lead lawmaker pushing for a complete undoing of the  telephone spying program, Senator Patrick Leahy (D-VT), said  following the speech that he wouldn’t fight the president on his  reform proposals.

The chairwoman of the Senate Intelligence Committee, Senator  Dianne Feinstein predicted after the speech that the telephone  spying program will end up surviving. She told NBC, “The  president has very clearly said that he wants to keep the  capability…I know a dominant majority of the — everybody,  virtually, except two or three – on the Senate Intelligence  Committee would agree with that.” Her counterpart in the  House Intelligence Committee, Rep. Mike Rogers (R-MI), echoed  those sentiments.

Rep. Adam Schiff, a member of the House Intelligence Committee,  took the bait as well and forecast that the bulk storage will   “inexorably” end up in the hands of the telecoms. He  said nothing about the ethics, efficacy, or constitutionality of  bulk collection.

Edward Snowden and the journalists he’s working with critically  wounded the NSA’s telephone spying program. Either by way of the  courts or by way of Congress, the program was not going to  survive in its current form. The President knew this, which is  why he had to give his ‘reform’ speech.

If he really wanted to see the program terminated, he could have  ended the bulk collection on his own without the approval of  Congress. He could have ordered his spy agencies to no longer  seek approval from the FISA court for the collection of  everyone’s telephone data. And by ending bulk collection, the  question of bulk storage would be settled, too.

But the president didn’t do that. Instead, he handed the wounded  remains of the program back to Congress, where the NSA’s  staunchest supporters are poised to reincarnate it before its old  form expires.

A few cosmetic changes, maybe a new overseer of the databases,  but ultimately, ‘collect it all’ spying has a better chance of  surviving now than it did before the president’s speech.

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.

Sam Sacks is a political commentator and journalist, the last five years spent covering politics in Washington, DC.

“Stop spying on people!” — Syrian Electronic Army’s cyber-attacks compromising Skype’s Twitter, Facebook accounts

January 2, 2014

Image from beta.syriadeeply.org

Image from beta.syriadeeply.org

 
 

Syrian computer hacker conglomerate, the Syrian Electronic Army (SEA), has kicked off the New Year with a number of cyber-attacks, compromising Skype’s Twitter, Facebook accounts, and its official blog.

Social media accounts belonging to Skype, Microsoft’s  voice-over-IP service, were hacked around 19:30 GMT. SEA posted  on Skype’s Twitter account a rogue message saying “Stop  spying on people! via Syrian Electronic Army.” The hacker  group also urged people not to use Microsoft accounts because the  company is “selling the data to the governments.”

SEA later re-tweeted the message using its own twitter page.

 

A similar message was posted on Skype’s Facebook page, but was  quickly deleted, according to TheNextWeb. The link to it, which  the SEA posted on its Twitter account, leads to a removed page.

Screenshot from facebook.comScreenshot from facebook.com

 

Attacks were also generated on Skype’s official blog with posts  calling on the US to stop its global spying activity.

SEA continued to attack Microsoft via its twitter account  posting, “You can thank Microsoft for monitoring your  accounts/emails using these details.”

 

Since SEA’s inception in 2011, the organization has denied any  association with the Syrian government. They claim to be  self-motivated patriotic supporters of the government, but are  not acting on its behalf.

In 2013, SEA claimed responsibility for hacking a number of  Western media outlets including the New York Times, The  Washington Post, The Huffington Post and Thomson Reuters.  Arguably, their biggest success was the penetration of the  Associated Press twitter account that posted President Barack  Obama had been injured in a White House attack.

Skype has now fully regained control and deleted the false tweets  from the compromised social media channels. Its blog is being  automatically redirected to Skype’s homepage.

“We recently became aware of a targeted cyber-attack that led  to access to Skype’s social media properties, but these  credentials were quickly reset. No user information was  compromised,” a Skype spokesman responded to TheNextWeb  query.

Skype also tweeted that no accounts of its other users had been  compromised.

 

The latest attacks by the SEA follow Edward Snowden’s revelations  of NSA eavesdrop outreach, including Microsoft.
In November Microsoft and its Skype division were cleared of data  protection violations relating to the NSA scandal by the  Luxembourg data protection regulator, CNPD.

The probe into Microsoft’s collaboration on data sharing with the  NSA found that the transfer of some data to affiliate companies  in the US appears “to take place lawfully” under a  so-called Safe Harbor agreement.

*********************************

Last November,

The hacktivist pro-Assad group known as the “Syrian Electronic Army” (SEA) briefly hijacked the Twitter feeds of TIME magazine in response to a critical description of President Assad’s candidacy for its ‘Person of the year’ award.

The SEA has tweeted from TIME’s official account: “Syrian  Electronic Army was here via @Official_SEA16. Next time write a  better word about the Syrian president #SEA”.
That tweet was soon deleted.

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The group referred to TIME’s list of people – politicians and  celebrities – selected as potential winners for “Person of the  Year,” the magazine’s annual award.

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Syrian President Bashar Assad is one of the candidates, while the  magazine describes him as: “Syria’s ruler presided over a bloody  year, shrugging off international concerns over the use of  chemical weapons as the death toll of his country’s civil war  eclipsed 100,000.”

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The voting closes on December, 4, with TIME’s Person of the Year  to be announced on December 11.

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The SEA also claimed interfering with the vote on the US  magazine’s webpage.

Modern “Spy” Edward Snowden Ignored As UK Prepares New Museum on Surveillance and Cyber Security at Bletchley Park

December 26, 2013

The Mansion House at Bletchley Park in Milton Keynes, north of London on February 20, 2013.(AFP Photo / Chris Radburn)

The Mansion House at Bletchley Park in Milton Keynes, north of London on February 20, 2013.(AFP Photo / Chris Radburn)

A new UK museum on surveillance and cyber security has refused to include Snowden’s revelations in its installation, sponsored by famous anti-virus magnate, McAfee. The decision was blasted by MPs who said Snowden should be considered part of history.

The Bletchley Park museum, which is chaired by former head of MI6  John Scarlet and is famous for its role as a center for code  breaking during the second world war, is planning to open a new  installation on cyber security but will not mention Edward  Snowden for fear that it “might imply it approves of Snowden’s  actions”, it was reported in the Guardian.

The new museum piece is sponsored by the US anti-virus software  firm, McAfee. Although the precise nature of the content of the  installation has yet to be decided a spokeswoman for Bletchley  Park said that “McAfee said [it] would not be able to  reference Snowden in any activity.”

“It is not within the remit of the Bletchley Park trust to  make political statements. We are very much a heritage  institution and involved with education. So that will be the  focus of the cyber-security exhibition – drawing lessons of the  past for the future,” said Kelsey Griffin, director of  Bletchley Park’s communications.

But Liberal Democrat MP, Julian Huppert, and Tory MPs, Rory  Stewart and Dominic Raab, say its reputation is now at risk for  refusing to acknowledge the huge impact of Snowden’s leaks about  the security services.

“Either it’s a history exhibition or it’s not. The Snowden  disclosures are a major event of our time, with enormous impact  on the debate over surveillance and privacy. It’s not clear why  on earth this is being airbrushed, but it risks tarnishing  Bletchley Park’s proud reputation,” said Raab.

US intelligence leaker Edward Snowden.(AFP Photo / Channel 4)US intelligence leaker Edward Snowden.(AFP Photo / Channel 4)

Huppert, who is also a member of the influential home affairs  select committee, said Bletchley Park could easily present the  facts of Snowden’s revelations without taking sides in the  question whether he is a whistleblower or a traitor, and let the  visitors draw their own conclusions.

“Ultimately, it is for Bletchley to decide what would make a  full and balanced exhibition, but to miss out the biggest piece  of news in this area for at least a decade would be a shame. It  would be very hard for them not to acknowledge the impact of  [Snowden's] revelations,” Huppert said.

Stewart, who is former diplomat agreed.

“I would have thought – almost whatever you think of him –   it’s impossible to talk about cyber security without mentioning  Edward Snowden,” he said.

When it was operational, Bletchley Park was top secret and  remained so for many years after the war. Winston Churchill  referred to the men and women who worked there as “my geese that  laid the golden eggs and never cackled”.

Eventually in the 1970s, it was revealed that the code breakers  at Bletchley cracked the illusive Nazi Enigma code used to direct  the German fleet of U boats in the Atlantic, and thereby tipped  the outcome of the war in the allies favor. The code breakers  used a machine called Colossus, the first electronic computer to  help them crack enigma.

Snowden, a former contract worker for the US National Security  Agency (NSA), leaked thousands of documents to the Guardian and  other newspapers in the US about the extent of US and British  surveillance programs, which analyze billions of emails, phone  calls and text massages.

While the US wants to put him on trial, Snowden was granted  temporary asylum in Russia for one year on the 1st August, after  a lengthy stay in the transit zone of a Moscow airport, and after  many other countries had refused to help him.

Putin Likes Obama’s NSA: FSB Now Wants All Russian Internet Communications Recorded

October 21, 2013

RIA Novosti/Vadim Zhernov

RIA Novosti/Vadim Zhernov

Russia’s Communications Ministry, in cooperation with security services, is finalizing a directive obliging internet providers to record private internet communications.

However, unwilling to bear unanticipated expenses, internet  providers are citing constitutional freedoms.

According to Kommersant daily, the new directive has been in  development for over six months, in close cooperation with the  Federal Security Service (FSB).

The major innovation of the new directive is that it would  require internet providers to record constantly the last 12 hours  or more of traffic coming through their servers, starting from  July 1, 2014. This would allow the FSB secret service to control  phone numbers, IPs, register entries, e-mails of social networks  users etc.

Kommersant Daily has obtained a letter from Russia’s  communications giant, Vympelkom, to the Ministry of  Communications and Mass Media. The letter signed by Aleksey  Rokotyan, Vympelkom’s Director of analytical support and liaison  with governmental bodies, maintains that the directive  contradicts articles 23, 24 and 25 of the Russian constitution,  which guarantee secrecy of communications and prevents collection  and recording of private information, unless ruled otherwise by a  court.

The letter also mentions the provider’s concern with the  additional expenses it would have to bear if the directive comes  into force.

Actually, all major providers are already closely cooperating  with the FSB and have their servers connected to FSB’s web  monitoring facilities. But recording terabytes of dataflow is an  expensive activity requiring additional data storage  installation; some minor providers would simply be unable to  sustain this financially.

So far providers have had to connect their servers to FSB lines  at their own expense, Kommersant Daily reports.     According to another Kommersant’s source, Vympelkom estimates  that $100 million of additional investment will be needed to  comply with the upcoming law, whereas according to the same  source another Russian IT major, MTS, estimates its extra  expenses caused by the law will be a much less – 300 million  rubles (less than $10m).

So the question now is whether the government is ready to finance  the undertaking from the budget, paying for millions of dollars’   worth of equipment needed.

Russia’s Ministry of Communications and Mass Media said that the  new directive “principally adds nothing new to the work of  internet providers”. Most of them have already been working  with security authorities closely since 2008, when obligatory  connection of servers’ dataflow to the FSB’s  Operational-Investigative System was introduced.

The Ministry’s press-service stressed that the new directive only  specifies the technical aspects of the FSB’s internet data use  and does not circumvent the necessity of a court ruling to get  access to private data.

“The system is not a threat to a law abiding citizen, it only  brings additional security,” the Ministry says.

“Operators would only be obliged to install the necessary  equipment and ensure FSB’s access to the data. Operators  themselves would not have access to the data processed on that  equipment, being performed in accordance with the law, within the  framework of the operational-investigative activities,” the  Ministry maintains.

Russian lawmakers gave an assurance that honest citizens have  nothing to fear.

“If someone doesn’t know, as of today (internet) operators are  actively and voluntarily cooperating with special services,  because no company, I hope, no citizen is interested in  concealing information that may lead to the identification of a  perpetrator and bring him to responsibility [sic],”   vice-speaker, Sergey Zheleznyak, told the RIA news agency. Mr  Zheleznyak oversees information technologies in the Russia’s  parliament. The MP also noted that the introduction of the new  directive is prompted by the fast development of the IT sphere.

The Chairman of the Senate’s Defense and Security Committee,  Viktor Ozerov, commented to RIA on the matter, saying that if the  FSB is investigating terror acts and crimes threatening national  security, he sees “nothing tragic” in special services  having access to internet dataflow. The Senator pointed out that  if police can, in certain cases, enter a private dwelling without  a court’s ruling, why can’t special services have a right to  access the servers of internet providers.

“We always talk about human rights when it comes to us  personally, but when serious security matters emerge, people tend  to blame special services for bad work,” the Senator added.

There is nothing wrong with controlling the internet as long as  the information is restricted for use strictly within the special  services, Russian MP Aleksandr Khinshtein commented on the news.
“If a person visits a normal, lawful website, what should he  be afraid or ashamed of?” Khinshtein said, stressing though  that there must be “certain controllability” of the  internet overseeing process.

The leader of the Fair Russia party, Sergey Mironov, has spoken  against the directive, saying that if Kommersant’s information is  correct, this is a direct violation of the Russian constitution.

At the same time, Mironov noted that he would like to get  acquainted with the document personally, saying that “the  publication, honestly speaking, looks strange and raises very big  questions.”

Last week the Russian government also announced the preparation  of a bill allowing the FSB to take measures against hackers who threaten the country’s  information systems.

  Kremlin regaining control over Russian internet

Russian lawmakers started preparing new legislation empowering  the FSB with new powers, following President Vladimir Putin’s  directive to ensure tighter national control over the Russian  segment of the World Wide Web.

Speaking at an expanded session of the FSB counterintelligence  service in February, President Putin declared that “nobody has a right  to sow hatred and rock society and the country, thus jeopardizing  the life, wellbeing and peace of millions of our citizens,”   stressing that extremist and terrorist groups use the internet  for disseminating their messages.

The Russian president urged the prevention of people, in  particularly younger members of society from “being dragged  into terrorist groups and militant gangs”.

“We should act resolutely to break up the different types of  extremist structures, and thwart the attempts of extremists to  use the capabilities of modern information technologies, Internet  resources and social networks for their propaganda,”   stipulated Vladimir Putin, demanding the development of a uniform  system that will be able to “detect, prevent and repel”   computer attacks against Russia’s information resources “as  promptly as possible”.

However, these “well-planned special operations” must be  implemented with “perfectly legal and judical  transparency,” said Putin back in February.

ObamaCare’s Technology Mess

October 1, 2013

At least a half dozen state exchanges won’t offer full online enrollment thanks to unresolved software problems.

By Scott Gottlieb and Michael Astrue

President Obama is bracing Americans for inevitable problems as the Affordable Care Act rolls out this week, but what he calls “glitches” are hardly routine. Information technology is ObamaCare’s Achilles’ heel. The faulty IT will expose Americans to lost data, attempts to enroll online that fail and the risk of fraud.

There are two key technological flaws in ObamaCare. First is the “hub”—the software to link servers at the Treasury Department, the Internal Revenue Service, Homeland Security and state agencies to verify the income and health-insurance status of enrollees and ensure that they are eligible for subsidies. The other flaw is the “portal”—the federally run IT platform that is supposed to let consumers compare health plans and select one that best suits their needs.

In planning ObamaCare’s IT infrastructure, the Centers for Medicare and Medicaid Services (CMS) dawdled for more than a year under Administrator Donald Berwick until Marilyn Tavenner took over in December 2011. Even then the agency was slow to outsource key contracts and turned to what insiders say were not top-quality programmers. CMS did not sign a contract for a backstop system to process paper verifications and do paper verifications of online applications until July.

Centers for Medicare and Medicaid Services Acting Administrator Marilyn Tavenner speaks during a news conference at the Health and Humans Services (HHS) Department in Washington, Wednesday, April 10, 2013, to discuss the Health Department's fiscal 2014 budget.   (AP Photo/Manuel Balce Ceneta)

Centers for Medicare and Medicaid Services Acting Administrator Marilyn Tavenner speaks during a news conference at the Health and Humans Services (HHS) Department in Washington, Wednesday, April 10, 2013, to discuss the Health Department’s fiscal 2014 budget. (AP Photo/Manuel Balce Ceneta)

The Health and Human Services Department did not begin testing the chief pieces of this IT system until August. The testing found that states couldn’t consistently link to the federal portal (a problem that persists in some states), and that the hub couldn’t reliably verify if a person is eligible for a subsidy, or accurately calculate how much the applicant is eligible to receive. HHS prevented independent watchdogs, including its own inspector general, from examining the systems before they go live on Oct. 1. The result is a host of troublesome gaps and dangers.

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Getty Images/Vetta

The biggest risk involves data security. The Obama administration created unnecessary opportunities for fraud with the White House’s pork-minded insistence on funding favored community groups to employ “navigators” to solicit applicants and help them input their personal information, such as income and Social Security numbers. The navigators were hastily hired and trained (they are still being hired) and were not given extensive background checks. The personal data for millions of people will be entrusted to these navigators—and to a computerized system that has been rushed into operation.

Another technological hurdle involves health-insurance subsidies. At least a half-dozen states, including Colorado and Oregon, have said that they won’t offer full online enrollment through their exchanges because the federal hub that is supposed to link to help them determine the subsidies people are eligible for isn’t working properly. A link to Medicaid agencies also isn’t functioning. This link is necessary to ensure that someone applying for a subsidy under a health plan is not Medicaid-eligible under his state’s rules.

If the hub can’t verify this, the individual will get booted from the ObamaCare enrollment system and shifted to a call center for confirmation by an ObamaCare agent who is likely to be fielding a deluge of complaints. Some people will end up getting subsidies they weren’t qualified for. Washington eventually will have to try to claw back the money. This will create a massive pay-and-chase challenge as people move in and out of the exchanges and get subsidies that many of them won’t even know they didn’t deserve.

The subsidies will likely present other woes. For example, separate cost-sharing subsidies intended to reduce a person’s out-of pocket costs are subject to the budget sequester. As a result, some of the reductions in co-insurance won’t materialize. Patients won’t know what they will owe for doctor visits, prescriptions or hospital stays. The Obama administration hasn’t begun to address the issue.

As for medical care, the current ObamaCare software doesn’t even try to take a serious stab at letting consumers match the health plans on the exchanges with their particular medical needs, or with their providers, at the point of enrollment. In some cases—but not necessarily all—they can click through to the plans to ferret out the information they need.

On Friday, HHS finally awarded a $380 million, four-year contract to manage appeals from consumers fighting for benefits that the insurance plans have denied. If it was hard to appeal medical claims through your current insurance plan, wait until you have to call a remote federal contractor.

The technology and privacy problems presented by ObamaCare aren’t likely to be mere rough patches that can be easily smoothed over. The provision of health care is an inherently local endeavor, and it increasingly appears that so is applying for health insurance. ObamaCare is an attempt to federalize the entire system, but the IT backbone appears unable to support this political ambition.

In September, the Minnesota state health-insurance exchange inadvertently disclosed several thousand Social Security numbers before the exchange even opened for business. Once the entire, gargantuan system is fired up nationwide, data leaks are almost a certainty.

That’s the thing about technology: Glitches happen. Usually they’re annoyances. Now, more than ever, they’re going to involve the government and your health.                

Dr. Gottlieb is a physician and resident fellow at the American Enterprise Institute. He is the Republican appointee on the HHS Federal Health IT Policy Committee that works on electronic health record guidelines for doctors’ offices but has nothing to do with the rollout of the ObamaCare exchanges. Mr. Astrue was the Commissioner of Social Security until earlier this year.

China and California sign deal to boost investment

April 10, 2013

U.S. Ambassador to China Gary Locke, right, shakes hand with California Gov. Jerry Brown, as Chinese Vice Minister of Commerce Wang Chao, center, look on during a Trade and Investment reception at the U.S. Embassy in Beijing Wednesday, April 10, 2013. (AP Photo/Andy Wong, Pool)

U.S. Ambassador to China Gary Locke, right, shakes hand with California Gov. Jerry Brown, as Chinese Vice Minister of Commerce Wang Chao, center, look on during a Trade and   Investment reception at the U.S. Embassy in Beijing Wednesday, April 10, 2013. (AP Photo/Andy Wong, Pool)

BEIJING (AP) — California and China signed an agreement Wednesday to look for ways to boost trade and investment, even as Gov. Jerry Brown acknowledged the state’s reputation for red tape and its limited willingness to offer tax incentives.

Brown told executives of mostly American companies that California has ranked at the bottom of nearly annual surveys of the business climate of U.S. states for 37 years. Having just resolved a $27 billion budget deficit, Brown said he’s not inclined to offer deep incentives to investors.

Still, he said the aggregate income of Californians is $1.9 trillion, and that the state remains a magnet for risk-taking venture investors, start-up entrepreneurs and other smart, creative people.

“There’s a problem there,” Brown told the American Chamber of Commerce in China. “But somebody is getting part of that 1.9 trillion. If you don’t want some of that, well then stay out.”

The message contrasts with the usual sales pitches by governors who tout the advantages of their states. While Brown’s administration seeks more Chinese trade and investment, California is already a well-known destination for Chinese.

Chinese Vice Commerce Minister Wang Chao told Brown on Wednesday that a third of Chinese exports to the U.S. end up in or pass through California, and that China imports electronics, machinery, chemicals, fruit and other goods from the state.

California attracted $854 million in investment from China between 2003 and 2010 when outbound Chinese investment was just starting, said a 2011 report by the Rhodium Group, a New York-based consultancy. California’s colleges and universities host a quarter of the 102,000 Chinese getting tertiary education in the U.S., according to the Institute of International Education.

The agreement signed Wednesday sets up a joint task force between California, China’s Commerce Ministry and six Chinese provinces and regions to look for ways to expand investment and trade. Sectors identified for cooperation include infrastructure, environmental protection, agriculture and bio- and information technology.

Brown said China’s commerce minister projected that California will receive $10 billion to $60 billion in Chinese investment between now and 2010. “I’ll take the latter number,” Brown said.

As part of the seven-day trade mission, Brown, who is traveling with business executives from California, will highlight the state’s interest in infrastructure on Thursday by traveling from Beijing to Shanghai on China’s showcase high-speed rail. In Shanghai, he will open a new trade office, replacing one that was shut down a decade ago amid an earlier round of cost-cutting.

China “resolutely opposes” U.S. curbs on IT imports

March 30, 2013

 

By Megha Rajagopalan

BEIJING (Reuters) – China expressed “resolute opposition” and “strong dissatisfaction” with a new U.S. cyber-espionage rule limiting imports of Chinese-made information technology products, state media reported on Saturday.

The remarks underscore growing tension between the world’s top two economies after the United States accused China of backing a string of hacking attacks on U.S. companies and government agencies.

China says the accusation lacks proof and that it is also a victim of hacking attacks, more than half of which originate from the United States.

The new provision, tucked into a funding bill signed into law on Thursday, requires NASA, as well as the Justice and Commerce Departments, to seek approval from federal law enforcement officials before buying information technology systems from China.

The United States imports about $129 billion worth of “advanced technology products” from China, according to a May 2012 report by the U.S. Congressional Research Service.

State media including Xinhua, the China Daily and the People’s Daily, quoted a spokesman for the Ministry of Commerce as saying the U.S. bill “sends a very wrong signal”.

“This will directly impact partnerships of Chinese enterprises and American business as they conduct regular trade,” said Shen Danyang, the commerce ministry spokesman.

“This abuse of so-called national security measures is unfair to Chinese enterprises, and extends the discriminatory practice of presumption of guilt,” the article in the official People’s Daily said, quoting Shen. “This severely damages mutual trust between the U.S. and China.”

The United States should eliminate the law, Shen said.

Technology security lawyer Stewart Baker wrote in a blog post this week that China could claim that the United States is violating World Trade Organization rules.

However, because Beijing hasn’t signed a WTO agreement setting international rules for government procurement, it may not be successful in its challenge, Baker said.

Chinese foreign ministry spokesman Hong Lei also urged the U.S. to abandon the law at a news conference on Thursday.

“This bill uses Internet security as an excuse to take discriminatory steps against Chinese companies,” he said.

China takes another swipe at Apple

China is Apple’s fastest growing market and the second-largest after the US. Photo: AFP/GETTY

The end of Indian IT staffing as we know it

March 25, 2013
By Harichandan Arakali and Tony Munroe | Reuters 
Employees walk inside Tech Mahindra office premises in Noida on the outskirts of New Delhi March 18, 2013. REUTERS/Adnan Abidi

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Employees walk inside Tech Mahindra office premises in Noida on the outskirts of New Delhi March 18, 2013. REUTERS/Adnan Abidi

By Harichandan Arakali and Tony Munroe

BANGALORE/MUMBAI (Reuters) – India’s IT outsourcers are promoting “mini CEOs” capable of running businesses on their own, while trimming down on the hordes of entry-level computer coders they normally hire as they try to squeeze more profits out of their staff.

The shift by Infosys Ltd and others is symptomatic of a maturing industry that wants more revenue from its own intellectual property instead of providing only labor-intensive, lower-margin information technology and back-office services.

For young graduates who see the $108 billion IT industry as a sure pathway to modern India’s growing middle class, the transformation is unsettling.

Dozens of industry aspirants who were recruited on campus by No. 4 player HCL Technologies recently protested outside its offices in several cities. They were offered jobs in 2011 before graduating last year but have not yet been given joining dates – or paychecks.

“Dear H.R. You were also a fresher… once,” read a sign carried by two protesters in a photo in The Hindu newspaper.

HCL’s December quarter profits and revenues rose while staff numbers shrank – a rare trick in an industry that has long aspired to break the linear relationship between headcount and revenue growth.

Just 20 percent of the 5,000-6,000 campus recruits offered HCL jobs in 2011 have been taken on board since graduation last summer, and HCL said it made no offers in 2012 to students who would graduate in June 2013.

Slower growth, fewer people leaving, greater demand by customers for experienced staff, and increased productivity through automation and software have put pressure on all recruits, according to HCL, which said it expects to accelerate bringing entry-level staff on board from August.

“It’s not that the demand doesn’t exist. It exists for different skills,” said Ajay Davessar, HCL’s head of external communications.

“Typical roles which a student thinks, ‘I’ll just go there and start coding, and have a good life,’ are being tested to reality… Any applicant, be it fresher or senior, will have to have flexibility in applying the skills elsewhere.”

FEWER ‘CODING COOLIES’

Tech Mahindra Ltd, the No.5 player, is naming 100 of what it calls mini-CEOs who will be given broad latitude to run their parts of the business.

“We’re moving towards a situation like the developed economies, where we’re asking the people to be more deep,” said Sujitha Karnad, who heads human resources at Tech Mahindra.

“We want more solution architects to be here. We don’t want the coding coolies anymore, that’s clear,” Karnad said, employing a term commonly used in India in association with menial laborers.

While plenty of Indian back office work such as technical support, processing insurance claims or staffing call centers will remain labor-intensive, software services firms are looking to move up the value chain, which means relying less on the time and toil of staff.

Growth in revenue per employee across the industry could expand to 5 percent a year in the next two years from about 3 percent over the past five, said Forrester Research principal analyst Frederic Giron. The growth rate is likely to accelerate from around 2015 as intellectual property-based work accounts for a growing share of the total, he said.

India’s IT services industry grew in large part because of the availability of cheap skilled labor, an advantage that is eroding as wages and other costs in India rise.

In years past, it was cost-effective for IT companies to hire new graduates by the thousands and keep a portion on the “bench” awaiting deployment on a client project.

But budget-constrained clients now demand shorter lead times. IT vendors that might have hired people six months in advance of an expected contract are now working with a one- or two-month window, said Surabhi Mathur Gandhi, senior vice president at TeamLease, a staffing consultancy.

Traditionally, about 30 percent of Indian IT services industry staff are on the bench at any given time, often in training, as they await deployment to client work.

In the December quarter, about 70 percent of Infosys staff and less than 65 percent at No. 3 provider Wipro were deployed on billable projects. At Tata Consultancy Services, the largest Indian IT services company, the figure was 72 percent, within what Ajoyendra Mukherjee, its human resources head, calls the comfort range of 70 to 74 percent utilization.

“I think we can push it up to 75, 76,” he said.

Another IT services company, iGate Corp, envisions a future where just 10 percent of staff sit on the bench, said Srinivas Kandula, its human resources head, who predicts that the size of its bench will shrink by 2 or 3 percentage points a year over the next five years.

BACK-UP PLAN

Shorter benches mean a smaller share of hiring is direct from campuses, as seasoned professionals moving from a competitor would be less willing to wait to be deployed and firms are reluctant to pay them to do so.

Companies are also binding hires, especially experienced ones, with three-month notice periods and no-buy-out clauses, compared with one-month notice periods previously.

Among top-tier companies that are most actively trying to push non-linear growth where revenues are not constrained by the size of the work force, about 70 percent of employees are experienced staff, up from 60 percent in 2008, said Rajiv Srinivas, an associate director at Tech Mahindra, who expects that to rise to about 90 percent in the next two or three years.

At Infosys, while the net quarterly addition of employees fell from 4,906 people in the March quarter last year to 977 in the December quarter (excluding an acquisition), lateral recruitment held steady at an average of about 4,300 staff per quarter through December, meaning the percentage of campus hires was much lower.

“Earlier, the focus was more on career … You get into a job, you start learning, and slowly acquire knowledge over a period of time,” said Sunil Gupta, who joined Infosys as vice president of quality about six months ago from the Indian unit of CGI Group’s Logica Plc.

“Today the value of a professional is judged by how quickly you’re learning, how quickly you’re adapting yourself and changing along with the environment,” he said.

For young Indians who saw IT as a ticket into the middle class, the change means that career path is becoming less clear. Those who do break in and build valuable skills will remain in demand, but the days of young IT staffers brandishing five or more competing offers are over.

Yet that hasn’t necessarily translated into slower wage growth. Mercer LLC expects industry salaries to grow 12 percent this year, the same as in 2012. As India’s economy diversifies, graduates have more attractive career options, including at multinationals with a growing India presence, such as Google Inc, which means IT vendors must fight to stay attractive.

“We see IT companies as a back-up,” said S. S. Jayaram, a final-year engineering student in Bangalore who says he chose a job in India with Mu Sigma Inc, a fast-growing U.S.-based data analytics company, over offers from IBM and TCS.


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