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From: Bruce Schneier (schneiercounterpane.com)
Date: Sun Jul 15 2001 - 15:31:23 CDT

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                      CRYPTO-GRAM

                     July 15, 2001

                   by Bruce Schneier
                    Founder and CTO
           Counterpane Internet Security, Inc.
                schneiercounterpane.com
              <http://www.counterpane.com>

    A free monthly newsletter providing summaries, analyses, insights, and
    commentaries on computer security and cryptography.

    Back issues are available at
    <http://www.counterpane.com/crypto-gram.html>. To subscribe or
    unsubscribe, see below.

    Copyright (c) 2001 by Counterpane Internet Security, Inc.

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

    In this issue:
          Phone Hacking: The Next Generation
          Crypto-Gram Reprints
          News
          Counterpane Internet Security News
          Single Sign-On
          Monitoring First
          Comments from Readers

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

           Phone Hacking: The Next Generation

    The phone network and the Internet are converging. That's good news for
    smart telephones, new telephony services, and customer convenience, and bad
    news for security. If you think that phone hacking is bad now, take a
    gander at what's coming.

    During the last fifteen years or so, there has been a trend toward
    intelligent telephone networking. We've seen ISDN. We've seen SS7. We've
    seen IN (Intelligent Networking). These protocols are responsible for all
    the cool telephony features we've come to know and love: call forwarding,
    call following, local number portability, caller ID, etc. These features
    work fine, but are limited because they are all controlled by the phone
    company. If you want to initiate caller ID, you need to get the phone
    company involved. If you want your business calls forwarded to your home
    after 5:00 PM, you need to turn that on and off every day.

    On the corporate side, we've seen Computer Telephony Integration (CTI),
    which didn't work very well because it was so big and clunky. It might be
    fine if you're a huge call center, but it just wasn't cost-effective for
    your average business. Development cycles were long, and service creation
    horrendously expensive; usage was rare.

    But along came the Internet, and everything changed. The notion of
    intelligent endpoints (computers) and a dumb network (routers) turns the
    telephony model upside down. There are several consortiums and standards
    bodies working on bringing the Internet model to the telephone network, and
    allowing Internet-based control of telephone switching. The idea is to
    turn the telephone network into a giant networking resource that people
    outside the telephone network can control and manage. The benefit to the
    enterprise is more features and control: cost savings, better sales and
    marketing, improved customer service, etc.

    The Parlay Group is a major player in this space. A consortium of
    software, hardware, and telephony companies, they are creating a
    specification and API to enable phone-system control from outside the
    secure telco network. This API will allow software to do such things as
    reroute calls, get notified of call attempts, retrieve the location of
    mobile users, and more. Even access to telco billing systems is
    planned. The idea is that computer applications can have integrated
    telephone components.

    Even more fundamentally, all the switching protocols will interoperate at
    multiple points. Switches, gatekeepers, proxies, and call control agents
    will all be components of the new telephony control system. Control can be
    distributed or centralized, depending on the application.

    Meanwhile, the IETF is defining the Session Initiation Protocol (SIP) for
    Voice over IP (VoIP) and more. This protocol will allow a user to define
    complicated ways to redirect calls: between 9 AM and 5 PM ring my office
    number, between 5 and 6 PM call my cell phone, after 6 PM call my home
    phone, and if my mother calls at any time, send her directly to voice
    mail. The protocol even includes a programming language, so a user can
    write a program to handle phone calls to match his own needs. While these
    features are nominally controlled by the user, the programs are stored in
    the telco network, and a DNS-like service is used to handle the profile and
    call forwarding. SIP is becoming a big thing; it's currently being used
    for VoIP telephony, will control calls in 3G wireless networks, and is
    being envisaged for all sorts of other uses like Instant Messaging.

    The big idea here is to leverage the development techniques of the Web to
    services for telephony. New services are essential, because all the
    carriers have cut their collective throats on per-minute long-distance
    rates. Premium services are seen by many as the only source of meaningful
    revenue in the future. This means that telephony, which has heretofore
    been slow and methodical and reliable, will become as freewheeling as the
    Internet.

    I am terrified at the security implications of these services. Sure, the
    Parlay spec says that communication between the Parlay client and Parlay
    server in the telco network is encrypted, and authentication will be
    enforced, but I don't believe for a minute that this will remain
    unhacked. SIP contains security provisions, but I don't trust them.

    It's not the details of the protocols. It doesn't matter how many bits the
    key is, or what authentication protocol they employ: we've learned from
    experience that all systems like this are hackable. The worry is that
    these protocols open a huge hole into the telephone system. The problem is
    that these telephony control systems will sit on top of insecure operating
    systems. They will be hacked, and then things will get ugly.

    Think about the possibilities for a minute. Denial-of-service attacks are
    a breeze: just reroute all calls to a person elsewhere. Or reroute all
    calls to a popular phone-sex service to another person. Or maybe just
    eavesdrop: set up a three-way conference bridge whenever someone receives a
    phone call. Remember the Trojan program that quietly made the modem dial
    Moldavia; this kind of system would make that hack a lot easier. And don't
    you think all of those hackers who chat on IRC would much rather take over
    a PBX and set up a conference call? You don't need me to think up the
    possibilities; there are lots and lots of them, none of them good.

    One of the biggest backward steps is the re-merging of the control and
    voice channels. Switch and PBX hacking used to be very easy when signaling
    was done in-band. SS7 is an out-of-band signaling system, which separated
    the voice from the telephone control and made "beeping into the receiver"
    hacking impossible. These new IP telephony systems rebuild that old,
    vulnerable model.

    It gets worse. The FCC is mandating that cell phone companies pinpoint
    phone locations to within 50-100 meters (for use with 911 calls). The
    carriers plan to use this information to create new data services based on
    location. The location information will also be available through services
    like Parlay for third parties to use. Imagine the security implications of
    that information getting into unauthorized hands. What if someone
    correlated a person's cell phone with his online identity? Could he
    pinpoint locations of desktop computers on the Internet? (This is actually
    a serious issue for 911 services. Unless one can somehow manage location
    information for endpoints, there's no hope of fielding a reasonable
    life-critical communications system based on the Internet.)

    And think about reliability. The one thing about the telephone system is
    that it just works. That reliability is very hard to engineer using
    Internet protocols. As the phone system starts to look more and more like
    the Internet, it will become as reliable as the Internet. This means that
    it will forever be in beta. This means there will be software
    incompatibilities, upgrade problems, and random weird errors. This means
    that it will fail, catastrophically, once in a while.

    Telephone hacking is not new. There have been decades of allegations and
    investigations into Las Vegas crime syndicates surreptitiously rerouting
    escort-service phone numbers, and the dial telephone was invented in the
    late 1800s by someone convinced that operators were rerouting his calls to
    rival businesses. Before the Internet, the phone network was the primary
    focus of hackers.

    But it's a hard network to hack. Telephony is still a controlled closed
    universe. The protocols are often proprietary, access is limited, and
    information is scarce. You need to speak SS7, have the right physical
    connections, etc. There is nominally no interconnect to the TCP/IP
    Internet. Even with knowledge, it is the limited physical access that
    provides the most constraint. Voice and control are on separate
    channels. None of this provides absolute security, but it helps keep the
    number of hackers down.

    The Internet, on the other hand, is much easier to hack. It's
    public. It's available. Anyone can connect a computer up to the
    Internet. Anyone can download boatloads of hacking tools. Anyone can
    become a script kiddie.

    What we're seeing is another example of the tension between functionality
    and security. Opening the network is a good thing from the perspective of
    creating innovative new services, speeding up development cycles, adding
    value to data and voice. Yet when we do this, we open up the potential for
    the bad things as well. It's impossible to get the one without the other.

    Soon the phone network will become just like the Internet. Putting control
    of telephony networks on the Internet means anyone can hack
    chicago.switch.uswest.net. These protocols will turn control over to both
    authorized and unauthorized Internet control. If you think phone phreaking
    was bad, just wait until anyone can do it.

    Standards and companies active in this area:
    <http://www.parlay.org>
    <http://www.telecomsys.com>
    <http://www.invertix.com>
    <http://www.locationet.com>
    <http://www.openls.org>
    <http://www.locationforum.org>
    <http://www.3gpp.org>
    <http://www.sipforum.org>
    <http://www.sipcenter.com>
    <http://www.etsi.org/tiphon>

    Steve Bass and John Ladwig both helped with this article.

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

                  Crypto-Gram Reprints

    Those of you who have subscribed recently might have missed these essays
    from back issues.

    Declassifying Skipjack:
    <http://www.counterpane.com/crypto-gram-9807.html#skip>

    The Future of Crypto-Hacking:
    <http://www.counterpane.com/crypto-gram-9907.html#hacking>

    Bungled SSL:
    <http://www.counterpane.com/crypto-gram-9907.html#doghouse>

    Full Disclosure and the CIA:
    <http://www.counterpane.com/crypto-gram-0007.html#1>

    Security Risks of Unicode:
    <http://www.counterpane.com/crypto-gram-0007.html#9>

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

                         News

    Security is a people problem:
    <http://cgi.zdnet.com/slink?107608:8469234>

    The NSA has released a bunch of guides to help DoD organizations secure
    Windows 2000.
    <http://nsa1.www.conxion.com/win2k/index.html>

    I'm not sure what to make of this one. Robert Hanssen, the FBI agent
    accused of spying for the Russians, wanted to retire into a job with
    Invicta Networks. (Invicta Networks is the company run by Soviet KGB
    defector Viktor Sheymov that I talked about last month.) Is Invicta
    Networks a government front? For which government? This is just plain weird.
    <http://www.nydailynews.com/2001-02-23/News_and_Views/Beyond_the_City/a-1009
    28.asp>

    Rental car companies use GPS features in their cars to spy on renters.
    <http://www.zdnet.com/zdnn/stories/news/0,4586,2778752,00.html>
    At least in this case, it has been declared illegal.
    <http://www.zdnet.com/zdnn/stories/news/0,4586,5093616,00.html>
    But the car rental company has no plans to change the policy.
    <http://www.wired.com/news/privacy/0,1848,45163,00.html>

    Insiders are a serious security concern.
    <http://cgi.zdnet.com/slink?110672:8469234>
    As are ex-employees (outsiders who used to be insiders, and who 1) often
    still have access, and 2) are sometimes pissed).
    <http://www.securityfocus.com/templates/article.html?id=220>
    <http://www.computerworld.com/itresources/rcstory/0,4167,STO61983.html>
    And corporate downsizing makes the problem worse:
    <http://www.computerworld.com/rckey73/story/0,1199,NAV63_STO61663,00.html>

    I have long wondered about the security of various online
    competitions. Here is a Coca Cola competition that has been hacked.
    <http://www.theage.com.au/news/national/2001/06/18/FFX85SO43OC.html>

    Negligence causes security problems. (Does this surprise anyone?)
    <http://www.vnunet.com/News/1123341>

    Here's a story about a Microsoft IIS vulnerability, a patch that many
    people have not bothered installing, and a hacker tool that exploits the
    vulnerability. Often the tools are made public, and are used by thousands
    of script kiddies world-wide. At this time, it seems that the hacker tools
    are being held closer to the vest because they are so valuable.
    <http://news.cnet.com/news/0-1003-200-6353491.html?tag=mn_hd>

    How the FBI investigates computer crime:
    <http://www.cert.org/tech_tips/FBI_investigates_crime.html>

    Parody: "Terms used in the disciplines of Cryptography, IT Security and
    Risk Analysis."
    <http://www.ii.uib.no/~larsr/craptology/crv0n0-0.html>

    Excellent three-part series on developing good security habits:
    <http://www.securityfocus.com/focus/basics/articles/sechabits1.html>
    <http://www.securityfocus.com/focus/basics/articles/sechabits2.html>
    <http://www.securityfocus.com/focus/basics/articles/sechabits3.html>

    NIST has released a new FIPS 140 standard. This has been the de facto
    standard for cryptographic modules, and is evoked for other crypto hardware
    devices. There aren't many changes in the new FIPS 140-2, but there are some.
    <http://csrc.nist.gov/cryptval/140-2.htm>

    Comparing computer viruses with biological viruses:
    <http://securityportal.com/articles/greatanalogy1.html>

    Terrorists are using encryption!!! This is a terrible story, one-sided and
    full of hyperbole. But it plays well as FBI propaganda. Remember kids,
    cryptography is for criminals. Big Brother is your friend. What I
    particularly like is the way key escrow is proposed as the solution when
    steganography is described as the problem. Geez.
    <http://www.usatoday.com/life/cyber/tech/2001-02-05-binladen.htm>

    Big Brother is Tampa's friend. During the recent Super Bowl in Tampa,
    Florida, the city installed video cameras that watched everybody coming
    into the stadium. Then, the faces were compared to an archive of wanted
    criminal suspects, looking for a match. (The system matched nineteen
    people, all wanted for minor offenses. No one was arrested.) Tampa liked
    the system so much they're making it permanent.
    <http://www.cnn.com/2001/TECH/ptech/07/02/high.tech.security.ap/index.html>

    Time for some good news. The EU is funding a project to build an
    intelligent agent that executes actions in compliance with European
    standard privacy legislation.
    <http://pet-pisa.openspace.nl/pisa_org/pisa/index.html>

    Article on NSA's Cryptologic Museum:
    <http://www.washingtonpost.com/wp-dyn/articles/A10615-2001Jul2.html>

    Teen hacker gets sentenced to psychiatric care, not jail:
    <http://news.bbc.co.uk/hi/english/uk/wales/newsid_1424000/1424937.stm>
    <http://cgi.zdnet.com/slink?116143:8469234>

    Eli Lilly leaks 600 names of Prozac users. I wonder what the "computer
    programming error" was -- using "To:" instead of "Bcc:" in an e-mail?
    <http://www.washingtonpost.com/wp-dyn/articles/A16718-2001Jul4.html>
    <http://www.siliconvalley.com/docs/news/svfront/009534.htm>

    Outlook Redemption is a developer tool specifically designed to let Outlook
    applications evade the Outlook security patches and built-in features of
    Outlook 2000 that warn users when applications send mail on their behalf,
    read their address book, and so forth. This can't possibly be a good idea.
    <http://www.dimastr.com/redemption/>
    On the other hand, the "security patch" is a really terrible idea, too; it
    won't let you receive bunches of different types of attachments, rather
    than letting the user choose. And there's no way to uninstall the security
    patch, once installed. That's what inspired this tool, I'll bet.

    This story is interesting because it shows how easy it is to track someone
    trying to be anonymous on the Internet, especially someone who doesn't
    understand how the Internet works.
    <http://www.wired.com/news/politics/0%2C1283%2C44567%2C00.html>

    Yet another scary hacking tool. Sure, there's a patch available. But what
    percentage of users actually have installed the patch? Anyone care to take
    a guess?
    <http://cgi.zdnet.com/slink?115257:8469234>

    Trojan horse that is a spam tool; it sends bulk e-mail without the user's
    knowledge.
    <http://cgi.zdnet.com/slink?115260:8469234>

    Having a firewall set up on your system doesn't do you much good if you
    don't monitor it for abnormal behavior.
    <http://cgi.zdnet.com/slink?116145:8469234>
    What I find interesting is the number of different things the author
    suggests you watch out for. This would be a tall order for anyone to do
    continuously, and this is just a small number of the total number of alerts
    -- from firewall logs and all the other network-device logs -- that you
    should be looking for. And, of course, you really want to be reading those
    logs in real-time, so you can react to problems quickly. This article
    explains the precise reason why I formed Counterpane Internet Security as a
    Managed Security Monitoring company.

    An argument for anonymity: From "The Economist": "Scientists and
    engineers at Xerox's Palo Alto Research Center (PARC), for instance, were
    discouraged from searching an online database of patents maintained by
    IBM. Xerox feared that if IBM tracked the pattern of inquiries made by its
    engineers at PARC, the computer giant could build a fairly accurate profile
    of the kind of research under way in the Palo Alto laboratories."
    <http://www.economist.com/science/tq/displayStory.cfm?story_id=662374>

    Top 10 security mistakes. Not a bad list, actually. The main problem is
    that some of these mistakes are not fixable. At least, it's not realistic
    to expect them to be fixed.
    <http://www.idg.net/ic_646834_1794_9-10000.html>

    You have to love the irony of this story. "A U.S. government website
    devoted to helping businesses keep sensitive information private instead
    revealed confidential information about American firms." Honestly, I don't
    think the so-called Safe Harbor idea is going to work long-term. As soon
    as European governments realize that private information is being leaked,
    they are going to demand the same controls on non-collection that they
    subject their own companies to.
    <http://www.wired.com/news/technology/0,1282,45031,00.html>

    Malware of the future will be worse.
    <http://news.cnet.com/news/0-1003-200-6548363.html?tag=mn_hd>

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

           Counterpane Internet Security News

    Some time ago I talked about various cool things going on at Counterpane
    that I couldn't talk about. One was the reseller agreement with Exodus,
    which I mentioned last month. The other is our VAR program. This is a big
    deal. A whole bunch of security VARs and resellers have signed up to
    resell Counterpane's Managed Security Monitoring service.
    Counterpane's U.S. VARs:
    <http://www.counterpane.com/pr-resellers.html>
    Counterpane's European VARs:
    <http://www.counterpane.com/pr-emeavars.html>
    Press coverage (please pardon the awful picture of me):
    <http://www.crn.com/Components/Search/Article.asp?ArticleID=28016>

    Alliance between Counterpane and Cigital:
    <http://www.counterpane.com/pr-cigital.html>

    Schneier is speaking at the 3rd Annual CERT Conference in Omaha on 6 August:
    <http://www.certconf.org/>

    A video interview with Bruce Schneier is on silicon.com:
    <http://www.silicon.com/a45413>

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

                   Monitoring First

    (Note: This essay advocates something that my company, Counterpane Internet
    Security, is selling. If this will offend you, please do not read this. I
    have announced my bias. You are forewarned.)

    You have a safe in a dilapidated building, and you need to secure
    it. What's the first thing you do? Inventory the safe? Assess the
    security of the building? Install better locks on the doors and bars on
    the windows? Probably not. The first thing you do, as quickly as
    possible, is alarm the safe. Once the safe is being monitored, you can
    then afford the time and attention needed to inventory the stock, analyze
    the environment, and improve the security. Without monitoring, you're
    vulnerable until your security is perfect. If you monitor first, you're
    immediately more secure.

    Network security has this backwards. Companies see monitoring as something
    to do after they have their security products in place. First they develop
    a security policy. Then they do a vulnerability analysis. Then they
    install a firewall, and maybe an intrusion detection system. And finally
    they think about monitoring. Rationally, this makes no sense.

    Monitoring should be the first step in any network security plan. It's
    something that a network administrator can do today to provide immediate
    value. Policy analysis and vulnerability assessments take time, and don't
    actually improve a network's security until they're acted upon. Installing
    security products improves security, but only if they are installed
    correctly and in the right places. How does a CIO know what products to
    install, and whether they are actually working -- in the actual corporate
    environment, not as they worked in the lab? The only way he can know is to
    monitor. Monitoring ensures that security products are working properly.

    This kind of thinking is especially important in dynamic environments like
    company networks. The network changes every day: new applications, new
    servers, new vulnerabilities. A CIO can go to sleep one night confident
    that his network is secure, and can wake up the following morning to read
    about a major vulnerability in the newspaper. Suddenly his network is wide
    open, even though nothing changed. A CIO can reconfigure his network to
    increase productivity, or add a new network service, or simply upgrade a
    software package, and suddenly the security of his environment is
    completely different. Networks are extremely complex -- nonlinear and
    tightly coupled -- and it's impossible to predict how different subsystems
    interact. How does he know the security ramifications of what he
    does? The only way is to monitor security.

    It's specious logic for a CIO to decide to wait until his network is
    stable, he understands his security, and all his patches are up to
    date. It'll never happen. Monitoring's best value is when a network is in
    flux -- as all large networks always are -- due to internal and external
    factors. Monitoring provides immediate security in a way that a
    vulnerability assessment can never provide, in a way that dropping a
    firewall into a network can never provide. Monitoring provides dynamic
    security in a way that a random product can never provide. And as security
    products are added into a network -- firewalls, IDSs, specialized security
    devices -- monitoring only gets better.

    In engineering, control theory is based on the concept of monitoring. An
    engineer might want to be able to tune his factory: "How can I control this
    plastic film extruder to ensure a uniform thickness of plastic?" This is a
    real question, and a complicated one. The plastics extruder might have a
    dozen different dials controlling things like temperature, pressure, and
    speed. You can adjust the amount and force of the air being blown, the
    amount of plastic bead material in the machine, or how rapidly the film is
    pulled out of the machine. All of these controls affect the thickness of
    the plastic; but what you really want is to turn a single dial that says "4
    mil plastic." But since each dial affects the others, can even cause
    time-dependent feedback loops, it's not nearly as simple as that. So what
    do you do? You monitor the system, not just at the output but
    internally. Then, based on what you've observed, you establish feedback
    loops to create a closed-loop system (I am i
    gnoring a library's worth of advanced mathematics here), and apply the
    mathematics of control theory to get what you want. It might take hundreds
    of pages of analysis, but that's how control theory works. But first you
    need to monitor so you know what's going on. Monitor, and you gain control
    of the system.

    Security is no different. Monitoring is what gives companies a window into
    their security. Did you install a firewall? An IDS? Why? Did it
    increase security or not? Did you configure it right? Did you install it
    at the right place in your network? How do you know? Monitoring is how
    you know. Monitoring is the only way you can really know. And once you
    know, you can start making changes. If you make changes without
    monitoring, you're just guessing.

    Monitoring is the feedback loop that makes all the other network security
    activities more effective. It's how you determine where to install
    security devices, and whether or not they're doing any good. It's how you
    know if your security devices are configured correctly. It's how you
    ensure that your security doesn't degrade over time. And it needs to be
    done first.

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

                 Comments from Readers

    From: Hal Lockhart <hal.lockhartentegrity.com>
    Subject: What Military History Can Teach Network Security

    In recent years, I have become convinced that one of the biggest obstacles
    to information security is incorrect reasoning based on false
    analogies. Don't get me wrong. I think analogies are great, I use them
    all the time to explain technical concepts to laymen. The problem comes
    when you try to design solutions from the analogy rather than the
    technology. A familiar, non-computer example is when people who don't
    understand the math try to argue about relativity. Closer to home, I have
    seen many people who put their Web server with private key outside the
    firewall. "I don't want to let somebody inside my wall until I check their
    credentials," they say. They are thinking about a guy with a crowbar, not
    computers sending and receiving messages.

    This brings me to your articles on war as a metaphor for hacking, which
    makes me nervous for the reasons stated. I am always happy to steal good
    ideas from anybody, but hacking as war strikes me more as rhetoric than
    reality. In a war, the enemy has some identity, common characteristics,
    loyalty and objectives. While we would prefer to defeat the enemy, we can
    have confidence that if the enemy achieves some set of goals they will be
    willing to stop fighting.

    The current state of the Internet seems a lot more like anarchy or
    vandalism. Attackers have no common characteristics or objectives, except
    the attacks themselves. In fact it appears that in most cases they have no
    external objective at all. Web defacements in particular seem almost
    exactly like spray painting graffiti on subway trains. This is a problem
    that was once thought to be insoluble, but was eventually reduced to
    acceptable levels by the combined use of technology (padlocks and special
    paints) and labor (cops and cleaners).

    However if you insist on war as the metaphor, here are two thoughts along
    those lines. First, the war, if that is what it is, is surely a guerrilla
    war. The entities being attacked are large, visible, slow-moving and part
    of the power structure. They have much greater resources than the
    attackers, but no effective way to apply them. The attackers and few,
    dispersed, hidden and have few resources. But what they have is the free
    choice of when and where to attack.

    To fight guerrillas it is necessary to a) identify them; i.e., distinguish
    them from civilians and b) control some resource that is essential to their
    survival. Given the Internet as it exists today, I don't see much hope of
    doing either of these. If the authorities decide to employ broadly
    targeted, draconian measures, they will find like the British in America
    and the Americans in Vietnam, that the collateral effects on innocent
    civilians are simply unacceptable.

    My second thought about hacking as war is that the situation can be
    compared to that in many wars, but most especially the American Civil
    War. While some people were busy fighting and dying, war profiteers made
    fortunes selling rotten food, unserviceable uniforms and non-working
    weapons. With a market full of snake oil security, bug-ridden applications
    and vendors who are more interested in suing or prosecuting people who
    reveal security problems than fixing them, this seems like the kind of war
    we are in.

    From: Bill McGonigle <billzettabyte.net>
    Subject: Re: CRYPTO-GRAM, June 15, 2001

    >From: Richard Straub <richard.straubmediacrypt.com>
    >Subject: Digital Content Protection
    >Preventing unauthorized people from copying or distributing
    >intellectual property is a natural law of this world, whether
    >it is a digital or physical product.

    It cannot be argued that a human law created less than 300 years ago is a
    natural law. Copyright was established in 1710 by the Statute of Anne by
    the British Parliament to protect the public from the publishers.

    This was an artifact of the printing press. After Gutenberg invented it a
    market for books developed. Before that people actually memorized and told
    stories. Books were way too expensive and had to be hand-copied by monks
    (in papal states). People decided they liked books, probably since then
    they could spend time on things besides memorizing stories. Once people
    didn't remember how to memorize stories, publishers figured out that they
    could make a bunch of money by creating a scarcity of stories in the books
    market. The Parliament put a stop to that with the copyright law by
    limiting the term of exclusivity, but since the capital costs of hiring a
    logging team, building a pulp plant and building a printing press are
    beyond that of ordinary citizens, a scarcity still existed, and publishers
    could make a fair profit.

    Digital reproduction drives the scarcity towards zero since the costs of
    reproduction and distribution of text are extremely low. Digital copyright
    protection seeks to artificially enforce the scarcity. But the function of
    the publishers as converters of trees into books is approaching
    obsolescence in the post-Gutenberg era. Rich citizens can afford to
    commission works directly, and poor citizens can cooperate with something
    like the Street Performer protocol.

    Neither Sophocles nor Chaucer nor Shakespeare had the benefit of copyright
    protection.

    From: Russell Nelson <nelsoncrynwr.com>
    Subject: Digital Content Protection

    >From: Paul Kocher <paulcryptography.com>
    >Subject: Digital Content Protection
    >For this reason, I disagree with the assertion that "unrestricted
    >distribution is a natural law of digital content" -- I don't see
    >piracy as the result of a natural law any more than stealing,
    >cheating, and eavesdropping are.

    Sorry, Paul, but Bruce is right. Without end-to-end encryption (in other
    words, directly inserted from the distributor into the person's senses
    without ever being available in plaintext -- using some technology that I
    doubt could exist or if it could, wouldn't be accepted by consumers), the
    hostile attacker (in other words, the user in the privacy of their home)
    can intercept the communications.

    Okay, so the plaintext is available. Now, I take that plaintext and
    encrypt it. I tell everyone "Suck down a copy of this file. I'll tell you
    what it is later; possibly much later." How is a content "owner" to deal
    with that? They can't decrypt it. They don't even know it's their
    content. They might think they own it if I describe it vaguely, or even
    exactly. But how to prove it in a court of law? "Sorry, your honor, I
    don't really know what that file is. I got it from someone else. No, your
    honor, I can't give you the key. Only the encryptor has the key to it, and
    I didn't encrypt it."

    The endgame has only two possibilities: 1) the complete prohibition of
    publishing anything with random bits in it, or 2) the death of
    copyright. #1 is not in the cards, therefore you can count on #2. Any
    action taken by any content owner to stop copying is just a delaying action
    based on revising their business plan or implementing same. Any action NOT
    based on the reality of #2 is head-in-the-sand idiocy, to be whacked by
    knowledgeable stockholders.

    Reply-To: Vladimir Katalov <vkatalovelcomsoft.com>
    Subject: Re: The Futility of Digital Copy Prevention

    > All digital copy protection schemes can be broken, and once they
    > are, the breaks will be distributed...

    Totally agree. Unfortunately, not all the people (especially developers of
    DRM (or how you call it: "digital copy protection schemes") think so. Our
    company specializes in password recovery and decryption software; just
    about two weeks ago, we have released a product that decrypts protected
    Adobe Acrobat PDF files and e-books, removing all protections. And
    immediately got problems with Adobe: they did their best to close our site
    etc. Now the site is functional again, we don't sell the program
    anymore. Also, they 'closed' the hole
    in Acrobat eBook Reader by making new, improved version, but we have broken
    it as well -- in just 20 minutes. Our program works like a demo --
    decrypts only 25% of file contents, just to demonstrate the problems with
    such kind of 'copy protection'.

    You can read the whole story about our battle with Adobe (and get our
    program) here: <http://www.elcomsoft.com/aebpr.html>

    From: Mike <John.Michael.Williamscomputer.org>
    Subject: The Fallacy of Incomplete Requirements

    In your 6/15 newsletter, Ken Ayer <kayervisa.com> wrote in justification
    of the Common Criteria (CC): "Every vendor (whether of a chip, card, lab or
    consulting service) says it's the best, but we need a way to compare these
    claims... What Visa has done with the Common Criteria is to start a
    dialogue on how to clearly express security requirements... We are making
    progress, though there remains work to be done...."

    This is the Fallacy of Incomplete Requirements: If we could all just get
    along, and write down what we REALLY want done, we could have those 'droid
    techies fix this annoying aberration.

    We informally compare marketing/technical claims all the time, those
    involving the life-and-limb of ourselves and our family -- for example,
    automotive safety. Show me the SAE spec for "automotive security," or
    component-wise, cockpit-collapse security, comparable to what the CC ilk want.

    Government and professional societies like SAE, IEEE, ACM, (or hybrids like
    CC bureaucracies) can't begin to do this. Collapse rate of a steering
    column? Right. Impact of a side-airbag? Right. Tire safety? Hmmm ...
    check the net for hearings and litigation, possibly criminal, on Ford vs.
    Firestone.

    Safety-rating of a cockpit, a vehicle, a model, a brand? No way. The
    market and painful experience reject the failures (the pre-'65 Chevy
    Corvairs, and maybe the Ford Explorers, for examples).

    What no one acknowledges is an observation I've made since entering the biz
    in '73. Science generally is extremely poor at detecting fraud and
    deception -- one doesn't get one's doctorate by proving why the big guys'
    ideas don't work, and you don't win tenure by winnowing out colleagues'
    detritus. Some of the biggest suckers for stage magic and plain old
    collusion have been scientists, especially government scientists.

    Computer security is unique in an aspect it fails to acknowledge: it
    contains the notion, and realization, of hostile automata. Let's see a
    requirements spec for that!

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

    CRYPTO-GRAM is a free monthly newsletter providing summaries, analyses,
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    Please feel free to forward CRYPTO-GRAM to colleagues and friends who will
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    CRYPTO-GRAM is written by Bruce Schneier. Schneier is founder and CTO of
    Counterpane Internet Security Inc., the author of "Secrets and Lies" and
    "Applied Cryptography," and an inventor of the Blowfish, Twofish, and
    Yarrow algorithms. He served on the board of the International Association
    for Cryptologic Research, EPIC, and VTW. He is a frequent writer and
    lecturer on computer security and cryptography.

    Counterpane Internet Security, Inc. is the world leader in Managed Security
    Monitoring. Counterpane's expert security analysts protect networks for
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    Copyright (c) 2001 by Counterpane Internet Security, Inc.