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  <channel>
    <title><![CDATA[[SecurityRatty] tag: liabilities]]></title>
    <link>http://securityratty.com/tag/liabilities</link>
    <description></description>
    <pubDate>Tue, 08 Aug 2006 04:56:00 +0000</pubDate>
    <generator>iRatty Engine</generator>
    <docs>http://blogs.law.harvard.edu/tech/rss</docs>
    <item>
      <title><![CDATA[Opinion: Encryption compliance still the Wild West]]></title>
      <link>http://securityratty.com/article/515cd2dfc3a309002722c001aa023901</link>
      <guid>http://securityratty.com/article/515cd2dfc3a309002722c001aa023901</guid>
      <description><![CDATA[Some states do not consider encryption alone sufficient to ensure that the data is unrecoverable, and at this stage in the game, companies cannot assume that just because they have encrypted data or...]]></description>
      <content:encoded><![CDATA[Some states do not consider encryption alone sufficient to ensure that the data is unrecoverable, and at this stage in the game, companies cannot assume that just because they have encrypted data or implemented encryption key management that they are either completely protected from future legal liabilities or have complied with the law.
<p><a href="http://feeds.computerworld.com/~a/Computerworld/Security/News?a=wTX6O7"><img src="http://feeds.computerworld.com/~a/Computerworld/Security/News?i=wTX6O7" border="0"></img></a></p><img src="http://feeds.computerworld.com/~r/Computerworld/Security/News/~4/368453695" height="1" width="1"/>]]></content:encoded>
      <pubDate>Mon, 18 Aug 2008 09:00:00 +0000</pubDate>
      <category domain="http://securityratty.com/tag/encryption">encryption</category>
      <category domain="http://securityratty.com/tag/encryption key management">encryption key management</category>
      <category domain="http://securityratty.com/tag/future legal liabilities">future legal liabilities</category>
      <category domain="http://securityratty.com/tag/data">data</category>
      <category domain="http://securityratty.com/tag/completely">completely</category>
      <category domain="http://securityratty.com/tag/law">law</category>
      <category domain="http://securityratty.com/tag/assume">assume</category>
      <category domain="http://securityratty.com/tag/stage">stage</category>
      <category domain="http://securityratty.com/tag/ensure">ensure</category>
      <source url="http://feeds.computerworld.com/~r/Computerworld/Security/News/~3/368453695/article.do">Opinion: Encryption compliance still the Wild West</source>
    </item>
    <item>
      <title><![CDATA[Memo to the President]]></title>
      <link>http://securityratty.com/article/f55b7cd26cfc6057b3118e4828224bba</link>
      <guid>http://securityratty.com/article/f55b7cd26cfc6057b3118e4828224bba</guid>
      <description><![CDATA[Obama has a cyber security plan
It's basically what you would expect : Appoint a national cyber security advisor, invest in math and science education, establish standards for critical infrastructure,...]]></description>
      <content:encoded><![CDATA[<p>Obama has a cyber security plan.</p>

<p>It's basically what <a href="http://www.barackobama.com/2008/07/16/remarks_of_senator_barack_obam_95.php">you</a> would <a href="http://www.barackobama.com/2008/07/16/fact_sheet_obamas_new_plan_to.php">expect</a>: Appoint a national cyber security advisor, invest in math and science education, establish standards for critical infrastructure, spend money on enforcement, establish national standards for securing personal data and data-breach disclosure, and work with industry and academia to develop a bunch of needed technologies.</p>

<p>I could comment on the plan, but with security the devil is always in the details -- and, of course, at this point there are few details.  But since he brought up the topic -- McCain supposedly is "<a href="http://www.scmagazineus.com/Cybersecurity-and-the-presidential-campaign/article/112566/">working on the issues</a>" as well -- I have three pieces of policy advice for the next president, whoever he is. They're too detailed for campaign speeches or even position papers, but they're essential for improving information security in our society.  Actually, they apply to national security in general.  And they're things only government can do.</p>

<p>One, use your immense buying power to improve the security of commercial products and services. One property of technological products is that most of the cost is in the development of the product rather than the production. Think software: The first copy costs millions, but the second copy is free.</p></p>

<p>You have to secure your own government networks, military and civilian. You have to buy computers for all your government employees. Consolidate those contracts, and start putting explicit security requirements into the RFPs. You have the buying power to get your vendors to make serious security improvements in the products and services they sell to the government, and then we all benefit because they'll include those improvements in the same products and services they sell to the rest of us. We're all safer if information technology is more secure, even though the bad guys can <a href="http://www.schneier.com/blog/archives/2008/05/dualuse_technol_1.html">use it, too</a>.

<p>Two, <a href="http://www.schneier.com/essay-141.html">legislate results and not methodologies</a>. There are a lot of areas in security where you need to pass laws, where the <a href="http://www.schneier.com/blog/archives/2007/01/information_sec_1.html">security externalities</a> are such that the market fails to provide adequate security. For example, software companies who sell insecure products are exploiting an externality just as much as chemical plants that dump waste into the river. But a bad law is worse than no law. A law requiring companies to secure personal data is good; a law specifying what technologies they should use to do so is not.  <a href="http://www.guardian.co.uk/technology/2008/jul/17/internet.security"> Mandating</a> <a href="http://www.schneier.com/essay-025.html">software</a> <a href="http://www.schneier.com/blog/archives/2007/01/information_sec_1.html">liabilities</a> for software failures is <a href=http://www.schneier.com/essay-116.html">good</a>, detailing how is not. Legislate for the results you want and implement the appropriate penalties; let the market figure out how -- that's what markets are good at.  </p>

<p>Three, broadly invest in research. Basic research is risky; it doesn't always pay off. That's why companies have stopped funding it. Bell Labs is gone because nobody could afford it after the AT&T breakup, but the root cause was a desire for higher efficiency and short-term profitability -- not unreasonable in an unregulated business. Government research can be used to balance that by funding long-term research.  </p>

<p>Spread those research dollars wide. Lately, most research money has been <a href="http://query.nytimes.com/gst/fullpage.html?res=9F04E1DB113FF931A35757C0A9639C8B63">redirected</a> through DARPA to near-term military-related projects; that's not good. Keep the earmark-happy Congress from <a href="http://www.ostp.gov/pdf/1pger_earmark.pdf">dictating</a> how the money is spent. Let the NSF, NIH and other funding agencies decide how to spend the money and don't try to micromanage.  Give the national laboratories lots of freedom, too. Yes, some research will sound silly to a layman. But you can't predict what will be useful for what, and if funding is really peer-reviewed, the average results will be much better. Compared to corporate tax breaks and other subsidies, this is chump change.</p>

<p>If our research capability is to remain vibrant, we need more science and math students with decent elementary and high school preparation. The declining interest is partly from the perception that scientists don't get rich like lawyers and dentists and stockbrokers, but also because science isn't valued in a country full of creationists. One way the president can help is by trusting scientific advisers and not overruling them for political reasons.</p>

<p>Oh, and get rid of those post-9/11 restrictions on student visas that are <a href="http://www7.nationalacademies.org/visas/Statement%20on%20Visa%20Problems.pdf">causing</a> (.pdf) so many top students to do their graduate work in Canada, Europe and Asia instead of in the United States. Those restrictions will <a href="http://www.aau.edu/research/Gast.pdf">hurt us</a> immensely in the long run.</p>

<p>Those are the three big ones; the rest is in the details. And it's the details that matter. There are lots of serious issues that you're going to have to tackle: data privacy, data sharing, data mining, government eavesdropping, government databases, use of Social Security numbers as identifiers, and so on. It's not enough to get the broad policy goals right. You can have good intentions and enact a good law, and have the whole thing completely gutted by two sentences sneaked in during rulemaking by some lobbyist.</p>

<p>Security is both subtle and complex, and -- unfortunately -- it doesn't readily lend itself to normal legislative processes. You're used to finding consensus, but security by consensus rarely works. On the internet, security standards are much worse when they're developed by a consensus body, and much better when someone just does them. This doesn't always work -- a lot of crap security has come from companies that have "just done it" -- but nothing but mediocre standards come from consensus bodies.  The point is that you won't get good security without pissing someone off: The information broker industry, the voting machine industry, the telcos. The normal legislative process makes it hard to get security right, which is why I don't have much optimism about what you can get done.</p>

<p>And if you're going to appoint a cyber security czar, you have to give him actual budgetary authority -- otherwise he won't be able to get anything done, either.</p>

<p>This essay <a href="http://www.wired.com/politics/security/commentary/securitymatters/2008/08/securitymatters_0807">originally appeared</a> on Wired.com.</p><div class="feedflare">
<a href="http://feeds.feedburner.com/~f/schneier/fulltext?a=LZGCXK"><img src="http://feeds.feedburner.com/~f/schneier/fulltext?i=LZGCXK" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/schneier/fulltext?a=56vyIK"><img src="http://feeds.feedburner.com/~f/schneier/fulltext?i=56vyIK" border="0"></img></a>
</div>]]></content:encoded>
      <pubDate>Tue, 12 Aug 2008 02:36:31 +0000</pubDate>
      <category domain="http://securityratty.com/tag/security">security</category>
      <category domain="http://securityratty.com/tag/security standards">security standards</category>
      <category domain="http://securityratty.com/tag/improvements">improvements</category>
      <category domain="http://securityratty.com/tag/security improvements">security improvements</category>
      <category domain="http://securityratty.com/tag/information security">information security</category>
      <category domain="http://securityratty.com/tag/research">research</category>
      <category domain="http://securityratty.com/tag/government research">government research</category>
      <category domain="http://securityratty.com/tag/cyber security plan">cyber security plan</category>
      <category domain="http://securityratty.com/tag/national security">national security</category>
      <source url="http://www.schneier.com/blog/archives/2008/08/memo_to_the_pre.html">Memo to the President</source>
    </item>
    <item>
      <title><![CDATA[Memo to Next President: How to Get Cyber Security Right]]></title>
      <link>http://securityratty.com/article/3cc71e9b8aab182bc3e96444e8660442</link>
      <guid>http://securityratty.com/article/3cc71e9b8aab182bc3e96444e8660442</guid>
      <description><![CDATA[Obama has a cyber security plan
It's basically what you would expect : Appoint a national cyber security advisor, invest in math and science education, establish standards for critical infrastructure,...]]></description>
      <content:encoded><![CDATA[<p>
Obama has a cyber security plan.
</p><p>
It's basically what <a href="http://www.barackobama.com/2008/07/16/remarks_of_senator_barack_obam_95.php">you</a> would <a href="http://www.barackobama.com/2008/07/16/fact_sheet_obamas_new_plan_to.php">expect</a>: Appoint a national cyber security advisor, invest in math and science education, establish standards for critical infrastructure, spend money on enforcement, establish national standards for securing personal data and data-breach disclosure, and work with industry and academia to develop a bunch of needed technologies.
</p><p>
I could comment on the plan, but with security the devil is always in the details -- and, of course, at this point there are few details.  But since he brought up the topic -- McCain supposedly is "<a href="http://www.scmagazineus.com/Cybersecurity-and-the-presidential-campaign/article/112566/">working on the issues</a>" as well -- I have three pieces of policy advice for the next president, whoever he is. They're too detailed for campaign speeches or even position papers, but they're essential for improving information security in our society.  Actually, they apply to national security in general.  And they're things only government can do.
</p><p>
One, use your immense buying power to improve the security of commercial products and services. One property of technological products is that most of the cost is in the development of the product rather than the production. Think software: The first copy costs millions, but the second copy is free.</p>

<p>You have to secure your own government networks, military and civilian. You have to buy computers for all your government employees. Consolidate those contracts, and start putting explicit security requirements into the RFPs. You have the buying power to get your vendors to make serious security improvements in the products and services they sell to the government, and then we all benefit because they'll include those improvements in the same products and services they sell to the rest of us. We're all safer if information technology is more secure, even though the bad guys can <a href="http://www.wired.com/politics/security/commentary/securitymatters/2008/05/blog_securitymatters_0501 ">use it, too</a>.
</p>
<p>Two, <a href="http://www.schneier.com/essay-141.html">legislate results and not methodologies</a>. There are a lot of areas in security where you need to pass laws, where the <a href="http://www.schneier.com/blog/archives/2007/01/information_sec_1.html">security externalities</a> are such that the market fails to provide adequate security. For example, software companies who sell insecure products are exploiting an externality just as much as chemical plants that dump waste into the river. But a bad law is worse than no law. A law requiring companies to secure personal data is good; a law specifying what technologies they should use to do so is not.  <a href="http://www.guardian.co.uk/technology/2008/jul/17/internet.security"> Mandating</a> software <a href="http://www.schneier.com/blog/archives/2007/01/information_sec_1.html">liabilities</a> for software failures is <a href=http://www.wired.com/politics/security/commentary/securitymatters/2006/06/71032">good</a>, detailing how is not. Legislate for the results you want and implement the appropriate penalties; let the market figure out how -- that's what markets are good at.  
</p><p>
Three, broadly invest in research. Basic research is risky; it doesn't always pay off. That's why companies have stopped funding it. Bell Labs is gone because nobody could afford it after the AT&T breakup, but the root cause was a desire for higher efficiency and short-term profitability -- not unreasonable in an unregulated business. Government research can be used to balance that by funding long-term research.  
</p><p>
Spread those research dollars wide. Lately, most research money has been <a href="http://query.nytimes.com/gst/fullpage.html?res=9F04E1DB113FF931A35757C0A9639C8B63">redirected</a> through DARPA to near-term military-related projects; that's not good. Keep the earmark-happy Congress from <a href="http://www.ostp.gov/pdf/1pger_earmark.pdf">dictating</a> (.pdf) how the money is spent. Let the NSF, NIH and other funding agencies decide how to spend the money and don't try to micromanage.  Give the national laboratories lots of freedom, too. Yes, some research will sound silly to a layman. But you can't predict what will be useful for what, and if funding is really peer-reviewed, the average results will be much better. Compared to corporate tax breaks and other subsidies, this is chump change.
</p><p>
If our research capability is to remain vibrant, we need more science and math students with decent elementary and high school preparation. The declining interest is partly from the perception that scientists don't get rich like lawyers and dentists and stockbrokers, but also because science isn't valued in a country full of creationists. One way the president can help is by trusting scientific advisers and not overruling them for political reasons.
</p><p>
Oh, and get rid of those post-9/11 restrictions on student visas that are <a href="http://www7.nationalacademies.org/visas/Statement%20on%20Visa%20Problems.pdf">causing</a> (.pdf) so many top students to do their graduate work in Canada, Europe and Asia instead of in the United States. Those restrictions will <a href="http://www.aau.edu/research/Gast.pdf">hurt us</a> (.pdf) immensely in the long run.
</p><p>
Those are the three big ones; the rest is in the details. And it's the details that matter. There are lots of serious issues that you're going to have to tackle: data privacy, data sharing, data mining, government eavesdropping, government databases, use of Social Security numbers as identifiers, and so on. It's not enough to get the broad policy goals right. You can have good intentions and enact a good law, and have the whole thing completely gutted by two sentences sneaked in during rulemaking by some lobbyist.
</p><p>
Security is both subtle and complex, and -- unfortunately -- it doesn't readily lend itself to normal legislative processes. You're used to finding consensus, but security by consensus rarely works. On the internet, security standards are much worse when they're developed by a consensus body, and much better when someone just does them. This doesn't always work -- a lot of crap security has come from companies that have "just done it" -- but nothing but mediocre standards come from consensus bodies.  The point is that you won't get good security without pissing someone off: The information broker industry, the voting machine industry, the telcos. The normal legislative process makes it hard to get security right, which is why I don't have much optimism about what you can get done.
</p><p>
And if you're going to appoint a cyber security czar, you have to give him actual budgetary authority -- otherwise he won't be able to get anything done, either.

<p>
---
</p>

<p><em>Bruce Schneier is chief security technology officer of BT, and author of </em>Beyond Fear: Thinking Sensibly About Security in an Uncertain World<em>.</em>
</p><br style="clear: both;"/>
  <img alt="" style="border: 0; height:1px; width:1px;" border="0" src="http://www.pheedo.com/img.phdo?i=0ca9e7363b324d8d77996a8ec3f346da" height="1" width="1"/>
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 <a href="http://feeds.wired.com/~f/wired/politics/security?a=bpRgSK"><img src="http://feeds.wired.com/~f/wired/politics/security?i=bpRgSK" border="0"></img></a> <a href="http://feeds.wired.com/~f/wired/politics/security?a=3GI8fk"><img src="http://feeds.wired.com/~f/wired/politics/security?i=3GI8fk" border="0"></img></a> <a href="http://feeds.wired.com/~f/wired/politics/security?a=tfYGEk"><img src="http://feeds.wired.com/~f/wired/politics/security?i=tfYGEk" border="0"></img></a> <a href="http://feeds.wired.com/~f/wired/politics/security?a=Ed9rWK"><img src="http://feeds.wired.com/~f/wired/politics/security?i=Ed9rWK" border="0"></img></a> </div><img src="http://feeds.feedburner.com/~r/wired/politics/privacy/~4/358550437" height="1" width="1"/><img src="http://feeds.wired.com/~r/wired/politics/security/~4/358550481" height="1" width="1"/>]]></content:encoded>
      <pubDate>Thu, 07 Aug 2008 11:45:00 +0000</pubDate>
      <category domain="http://securityratty.com/tag/security">security</category>
      <category domain="http://securityratty.com/tag/security standards">security standards</category>
      <category domain="http://securityratty.com/tag/improvements">improvements</category>
      <category domain="http://securityratty.com/tag/security improvements">security improvements</category>
      <category domain="http://securityratty.com/tag/information security">information security</category>
      <category domain="http://securityratty.com/tag/cyber security plan">cyber security plan</category>
      <category domain="http://securityratty.com/tag/research">research</category>
      <category domain="http://securityratty.com/tag/government research">government research</category>
      <category domain="http://securityratty.com/tag/national security">national security</category>
      <source url="http://feeds.wired.com/~r/wired/politics/security/~3/358550481/securitymatters_0807">Memo to Next President: How to Get Cyber Security Right</source>
    </item>
    <item>
      <title><![CDATA[Software Liabilities and Free Software]]></title>
      <link>http://securityratty.com/article/dd4800aaf10918236391882307e39b57</link>
      <guid>http://securityratty.com/article/dd4800aaf10918236391882307e39b57</guid>
      <description><![CDATA[Whenever I write about software liabilities , many people ask about free and open source software. If people who write free software, like PasswordSafe , are forced to assume liabilities, they will...]]></description>
      <content:encoded><![CDATA[<p>Whenever I <a href="http://www.guardian.co.uk/technology/2008/jul/17/internet.security">write</a> <a href="http://www.schneier.com/blog/archives/2007/01/information_sec_1.html">about</a> <a href="http://www.schneier.com/essay-116.html">software</a> <a href="http://www.schneier.com/essay-025.html">liabilities</a>, many people ask about free and open source software.  If people who write free software, like <a href="http://www.schneier.com/passsafe.html">PasswordSafe</a>, are forced to assume liabilities, they will simply not be able to and free software would disappear.</p>

<p>Don't worry, they won't be.</p>

<p>The key to understanding this is that this sort of contractual liability is part of a contract, and with free software -- or free anything -- there's no contract.  Free software wouldn't fall under a liability regime because the writer and the user have no business relationship; they are not seller and buyer.  I would hope the courts would realize this without any prompting, but we could always pass a Good Samaritan-like law that would protect people who distribute free software.  (The opposite would be an Attractive Nuisance-like law -- that would be bad.)</p>

<p>There would be an industry of companies who provide liabilities for free software.  If Red Hat, for example, sold free Linux, they would have to provide some liability protection.  Yes, this would mean that they would charge more for Linux; that extra would go to the insurance premiums.  That same sort of insurance protection would be available to companies who use other free software packages.</p>

<p>The insurance industry is key to making this work.  Luckily, they're good at protecting people against liabilities.  There's no reason to think they won't be able to do it here.</p>

<p>I've written more about liabilities and the insurance industry <a href="http://www.schneier.com/crypto-gram-0204.html#6">here</a>.</p><div class="feedflare">
<a href="http://feeds.feedburner.com/~f/schneier/fulltext?a=eikXNJ"><img src="http://feeds.feedburner.com/~f/schneier/fulltext?i=eikXNJ" border="0"></img></a> <a href="http://feeds.feedburner.com/~f/schneier/fulltext?a=znVSvJ"><img src="http://feeds.feedburner.com/~f/schneier/fulltext?i=znVSvJ" border="0"></img></a>
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      <pubDate>Mon, 28 Jul 2008 10:42:33 +0000</pubDate>
      <category domain="http://securityratty.com/tag/free software">free software</category>
      <category domain="http://securityratty.com/tag/free">free</category>
      <category domain="http://securityratty.com/tag/free software packages">free software packages</category>
      <category domain="http://securityratty.com/tag/distribute free software">distribute free software</category>
      <category domain="http://securityratty.com/tag/software liabilities">software liabilities</category>
      <category domain="http://securityratty.com/tag/liabilities">liabilities</category>
      <category domain="http://securityratty.com/tag/assume liabilities">assume liabilities</category>
      <category domain="http://securityratty.com/tag/free linux">free linux</category>
      <category domain="http://securityratty.com/tag/people">people</category>
      <source url="http://www.schneier.com/blog/archives/2008/07/software_liabil.html">Software Liabilities and Free Software</source>
    </item>
    <item>
      <title><![CDATA[Information Security and Liabilities]]></title>
      <link>http://securityratty.com/article/58f3a18307a0d05fd6b06c9da81ce4e3</link>
      <guid>http://securityratty.com/article/58f3a18307a0d05fd6b06c9da81ce4e3</guid>
      <description><![CDATA[In my fourth column for the Guardian last Thursday, I talk about information security and liabilities : Last summer, the House of Lords Science and Technology Committee issued a report on &quot;Personal...]]></description>
      <content:encoded><![CDATA[In my fourth column for the <i>Guardian</i> last Thursday, I talk about <a href="http://www.guardian.co.uk/technology/2008/jul/17/internet.security">information security and liabilities</a>:

<blockquote>Last summer, the House of Lords Science and Technology Committee issued <a href="http://www.publications.parliament.uk/pa/ld200607/ldselect/ldsctech/165/165i.pdf">a report</a> on "Personal Internet Security." I was invited to give testimony for that report, and one of my recommendations was that software vendors be held liable when they are at fault. Their final report included that recommendation. The government <a href="http://www.official-documents.gov.uk/document/cm72/7234/7234.pdf">rejected</a> the recommendations in that report last autumn, and last week the committee <a href="http://www.publications.parliament.uk/pa/ld200708/ldselect/ldsctech/131/131.pdf">issued</a> a report on their follow-up inquiry, which still recommends software liabilities.

Good for them.

I'm not implying that liabilities are easy, or that all the liability for security vulnerabilities should fall on the vendor. But the courts are good at partial liability. Any automobile liability suit has many potential responsible parties: the car, the driver, the road, the weather, possibly another driver and another car, and so on. Similarly, a computer failure has several parties who may be partially responsible: the software vendor, the computer vendor, the network vendor, the user, possibly another hacker, and so on. But we're never going to get there until we start. Software liability is the market force that will incentivise companies to improve their software quality – and everyone's security.</blockquote><div class="feedflare">
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      <pubDate>Wed, 23 Jul 2008 11:09:21 +0000</pubDate>
      <category domain="http://securityratty.com/tag/security">security</category>
      <category domain="http://securityratty.com/tag/information security">information security</category>
      <category domain="http://securityratty.com/tag/liabilities">liabilities</category>
      <category domain="http://securityratty.com/tag/liability">liability</category>
      <category domain="http://securityratty.com/tag/software liability">software liability</category>
      <category domain="http://securityratty.com/tag/computer vendor">computer vendor</category>
      <category domain="http://securityratty.com/tag/vendor">vendor</category>
      <category domain="http://securityratty.com/tag/report">report</category>
      <category domain="http://securityratty.com/tag/automobile liability suit">automobile liability suit</category>
      <source url="http://www.schneier.com/blog/archives/2008/07/information_sec_2.html">Information Security and Liabilities</source>
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    <item>
      <title><![CDATA[Metro Round-Up: Phila., Minneapolis, St. Louis Park (Minn.), Texas, Foster City (Calif.), Naperville (Ill.), Chehalis and Centralia (Wash.), Cambria C]]></title>
      <link>http://securityratty.com/article/ba9fa39ee95e3dd8fdd6d81a86d5370d</link>
      <guid>http://securityratty.com/article/ba9fa39ee95e3dd8fdd6d81a86d5370d</guid>
      <description><![CDATA[Philadelphia may find operator for Wi-Fi network: The AP reports that the City of Brotherly Love's Wi-Fi network isn't yet down, or down for the count. While it's scheduled to be flipped off tomorrow...]]></description>
      <content:encoded><![CDATA[<p><img src="http://wifinetnews.com/images/muni_icon.jpg" align="right" border="0" hspace="5" /><a href="http://www.forbes.com/feeds/ap/2008/06/11/ap5104811.html"><strong>Philadelphia may find operator for Wi-Fi network:</strong></a> The AP reports that the City of Brotherly Love's Wi-Fi network isn't yet down, or down for the count. While it's scheduled to be flipped off tomorrow (you can read whatever you like into the phrase "flipped off"), the city is talking to a party it won't disclose about the networks future. EarthLink sued Phila. in May to be able to remove its equipment and cap its liabilities. The city's wireless non-profit arm, Wireless Philadelphia, has made noises about what EarthLink's true liability could be; the non-profit has born some of the electrical cost, and might be seeking to have that repaid on top of penalties and other expenses.</p>

<p><a href="http://www.startribune.com/business/19726749.html?location_refer=Homepage"><strong>Minneapolis suffers the heartbreak of leafage:</strong></a> Leaves are popping in Minneapolis, and Star-Tribune columnist Steve Alexander writes that residents are seeing some Wi-Fi reception problems on that city's Wi-Fi network. This is the only big-city network that can be currently described "successful," even though its long-term success has to be proven out. The firm responsible, USI Wireless, told Alexander they're working on adjusting about 5 percent of antennas to cope with the pesky greenery.</p>

<p><a href="http://www.startribune.com/local/west/19745504.html?location_refer=Style%20+%20People"><strong>St. Louis Park sues ARINC over Wi-Fi network:</strong></a> The Minnesota town says the network never worked, and had earlier discussed a lawsuit. The city wants the value of the contract ($1.7m) plus a very modest amount in damages and fees ($50,000). The city plans to start removing gear if ARINC doesn't sometime in June. But they have to deal with 490 poles erected to hold the nodes and solar-charging gear--sunk into concrete. More recent testing showed that the network worked well in some areas, but the majority of the network did not, according to the Star Tribune.</p>

<p><a href="http://telecompetitor.com/node/671"><strong>Verizon builds out fiber in AT&T territory:</strong></a> Interesting sign of competition in otherwise monopoly-per-provider-type world. Verizon is using AT&T's hard-won statewide video franchising rules in Texas to build competitive fiber in Dallas suburbs. They're apparently not bringing telecom; they're acting like a cable TV firm with data. Verizon owns chunks of territory all over due to it encompassing GTE in a deal years ago. GTE serves suburbs west of Portland, Ore., and east of Seattle, for instance, while Qwest serves most of the rest of each state.</p>

<p><a href="http://sanmateodailynews.com/article/2008-6-7-fc-metrofi"><strong>Foster City Wi-Fi dies on June 20:</strong></a> MetroFi is unlighting its cities, and Foster City opted not to spend the nearly $200,000 asking price MetroFi put on its equipment. MetroFi might still find a buyer, but June 20 is the network's current final day. Naperville, Ill., <a href="http://www.suburbanchicagonews.com/napervillesun/news/998667,6_1_NA11_WIFI_S1.article"><strong>also expects a June 20 shutdown</strong></a>. They, too, were offered the network hardware for 200 grand.</p>

<p><a href="http://www.chronline.com/story.php?subaction=showfull&id=1213119382&archive=&start_from=&ucat=1"><strong>Chehalis lights up:</strong></a> A small city in southern Washington votes to put in Wi-Fi hotzones. The cost is about $53,000 and annual fees $15,000. Funds will come from existing tax and grant sources. The city chose to install service to make sure they're not missing a checkbox on the amenities list for visitors and businesses rather than for a particular, measurable goal.</p>

<p><a href="http://www.chronline.com/story.php?subaction=showfull&id=1213205136&archive=&start_from=&ucat=1"><strong>Nearby Centralia pulls its Wi-Fi:</strong></a> A pilot project in the larger city of Centralia, Wash., a bit north of Chehalis, is shut down when poles used to mount Wi-Fi radios are removed as electrical wires are buried. (The reporter here confuses broadband over powerlines (BPL) with broadband wireless.) The system might be restarted later.</p>

<p><a href="http://www.muniwireless.com/2008/06/10/guest-commentary-how-a-pennsylvania-county-paved-the-way-to-muni-broadband-success/"><strong>Craig Settles writes up Pennsylvania's Cambria County wireless success:</strong></a> This is a network built for particular municipal purposes, part of Settles's long-time drumbeat about having applications first and then networks built for those networks second. He notes that Cambria built a 700 sq mi network that sounds nearly cost neutral through efficiency and cost conservation--it's cheaper to get much more service with this network than it was for a smaller array of services with incumbent-provided networks. </p>

<p><a href="http://www.scsun-news.com/news/ci_9545465"><strong>Santa Fe residents oppose Wi-Fi in the library on health grounds:</strong></a> You know what I have to say about how provable this has turned out to be in clinical studies. I am, however, as always, concerned about these people's health, even if I don't believe that Wi-Fi (or EMF) causes their problems. The group opposed to library-Fi is citing the ADA in this case, uniquely I believe. Six libraries suggested that EMF triggers seizures in epileptics, something I've never heard cited before; maybe CRTs (flickering), but EMF? Wired is substantially less kind than I am, pointing out that EMF other than Wi-Fi produces <a href="http://blog.wired.com/gadgets/2008/06/santa-fe-whiner.html"><strong>vastly higher signal strength</strong></a>. (They're sort of ignoring signal strength at a given point where an individual stands in relation to a transmitter, however.)</p>]]></content:encoded>
      <pubDate>Wed, 11 Jun 2008 10:33:41 +0000</pubDate>
      <category domain="http://securityratty.com/tag/city">city</category>
      <category domain="http://securityratty.com/tag/big-city network">big-city network</category>
      <category domain="http://securityratty.com/tag/residents oppose wi-fi">residents oppose wi-fi</category>
      <category domain="http://securityratty.com/tag/wi-fi">wi-fi</category>
      <category domain="http://securityratty.com/tag/mount wi-fi radios">mount wi-fi radios</category>
      <category domain="http://securityratty.com/tag/wi-fi hotzones">wi-fi hotzones</category>
      <category domain="http://securityratty.com/tag/wi-fi network">wi-fi network</category>
      <category domain="http://securityratty.com/tag/network">network</category>
      <category domain="http://securityratty.com/tag/network hardware">network hardware</category>
      <source url="http://wifinetnews.com/archives/008353.html">Metro Round-Up: Phila., Minneapolis, St. Louis Park (Minn.), Texas, Foster City (Calif.), Naperville (Ill.), Chehalis and Centralia (Wash.), Cambria C</source>
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    <item>
      <title><![CDATA[EarthLink Will Shutter Philadelphia Network, Company Says]]></title>
      <link>http://securityratty.com/article/5a938e0c429c5b2b2511d2b537800149</link>
      <guid>http://securityratty.com/article/5a938e0c429c5b2b2511d2b537800149</guid>
      <description><![CDATA[It's the end of the cycle, folks: The first shall be last and the last shall, apparently, be first to sue. The Philadelphia Wi-Fi network will be shuttered under plans by EarthLink that they announced...]]></description>
      <content:encoded><![CDATA[<p><img src="http://wifinetnews.com/images/muni_icon.jpg" align="right" border="0" hspace="5" /><a href="http://news.yahoo.com/s/ap/20080513/ap_on_hi_te/wireless_philadelphia_2"><strong>It's the end of the cycle, folks:</strong></a> The first shall be last and the last shall, apparently, be first to sue. The Philadelphia Wi-Fi network will be shuttered under plans by EarthLink that they announced via <a href="http://ir.earthlink.net/releasedetail.cfm?ReleaseID=310055"><strong>press release today</strong></a>. </p>

<p>The company plans to pull all its gear from the poles starting 12-June-2008. The company's press release said it offered to give the network at no cost to an unnamed non-profit, as well as to the city, but claimed that "unresolved issues" led to the effort falling apart. EarthLink offered cash and more equipment, as well, in undisclosed quantities. Wireless Philadelphia, the non-profit in charge of managing the network provider and administering digital divide programs, was apparently not the non-profit mentioned. </p>

<p>EarthLink filed a lawsuit to allow it to remove its Wi-Fi nodes and cap its liability at $1m. That's a pretty hostile move, given that the city would have been the more likely party to feel aggrieved and file suit against EarthLink for failing to live up to the terms of their agreement.</p>

<p>EarthLink's claims of offering the network to "a non-profit" or the city for free skirts the issue that EarthLink may have certain liabilities for electrical power and other fees that haven't yet been paid; Wireless Philadelphia had agreed to pick up or defer certain charges as part of the deal that brought the network provider in. But without a completed network, and the contract therefore perhaps susceptible to being declared in default in court, it's unlikely that this will play out nicely.</p>

<p>And I'll say bluntly: If someone offered you $17m of outdated equipment on a network that never worked to specification that wasn't completed, and that already had known high annual costs, and which a private firm gave up as a bad job that they couldn't turn a dime on--would you take that deal? No. EarthLink will ultimately have to pay much more than $1m, I predict, and I suspect some of the settlement will leave gear in selected neighborhoods behind for more modest networking purposes. It's not going to be as easy as releasing a press release, although I haven't read the contract's provisions for this set of circumstances, and I'm not a lawyer.</p>

<p>The failure in Philadelphia, and EarthLink's exiting the entire muni-Fi business, represents the end of a bad model in which a company agreed to assume all risk and costs associated with building a public access network. When the assumptions were that networks would be cheaper and easier to build in 2005, and that citizens in many larger cities had few affordable broadband options, it made some sense to build a network on spec.</p>

<p>Three years into this, however, it's clear that that capital investment is 2 to 3 times higher than what was anticipated to reach a level of service quality that people will expect; that, when presented with potential competition, DSL and cable operators will slash prices and offer cheap 1-year or "lifetime" rates with long-term contracts; and that wireless broadband delivered via Wi-Fi isn't the best of ideas for indoor service.</p>

<p>Minneapolis may wind up being the only large city, if the network quality and subscriber rates play out, that has a public access network that works and produces a return. </p>]]></content:encoded>
      <pubDate>Tue, 13 May 2008 05:48:07 +0000</pubDate>
      <category domain="http://securityratty.com/tag/network">network</category>
      <category domain="http://securityratty.com/tag/wi-fi">wi-fi</category>
      <category domain="http://securityratty.com/tag/philadelphia wi-fi network">philadelphia wi-fi network</category>
      <category domain="http://securityratty.com/tag/earthlink">earthlink</category>
      <category domain="http://securityratty.com/tag/network provider">network provider</category>
      <category domain="http://securityratty.com/tag/philadelphia">philadelphia</category>
      <category domain="http://securityratty.com/tag/public access network">public access network</category>
      <category domain="http://securityratty.com/tag/company">company</category>
      <category domain="http://securityratty.com/tag/earthlink filed">earthlink filed</category>
      <source url="http://wifinetnews.com/archives/008316.html">EarthLink Will Shutter Philadelphia Network, Company Says</source>
    </item>
    <item>
      <title><![CDATA[Running Government Finances Like a Bank]]></title>
      <link>http://securityratty.com/article/6dab6aba532e92941bcf76b501ee7739</link>
      <guid>http://securityratty.com/article/6dab6aba532e92941bcf76b501ee7739</guid>
      <description><![CDATA[Many investors are concerned about the increase in public debt of Asian countries since the Asian Financial Crisis . As justification, governments need to issue debt to support the financial markets,...]]></description>
      <content:encoded><![CDATA[Many investors are concerned about the increase in public debt of Asian countries since the <strong>Asian Financial Crisis</strong>. As justification, governments need to issue debt to support the financial markets, jump start the economy, and develop infrastructure, etc. Sovereigns with large outstanding debt are seen to be more credit risky and more more susceptible to something going wrong. Thus, the <strong>IMF</strong> issued guidelines on <strong>Public Debt Management (PDM)</strong>.<br /><br />In a nutshell PDM takes <strong>Asset-Liability Management</strong> best practice from banks and insurance companies and applies them in managing government debt. This makes sense since the biggest financial portfolio in a country is the government's finances anyway.<br /><br />Governments should focus on ALM issues like <strong>liquidity and interest rate risk management</strong>. It should analyze the cost-benefit trade off of borrowing in the short term - which is cheap but risky and volatile, as opposed to borrowing long term - which is expensive but predictable. They should also focus on minimizing unhedged foreign exchange exposures, debt with embedded put options (unpredictable maturities), and implicit contingent liabilities.<br /><br />Governments should also push for the development of their domestic currency capital markets. A developed capital market would mean that there are a lot of investors and variety of issued securities. Development of derivatives markets will also be beneficial as investors are more willing to take and hedge risks. A developed capital market will also allow the government to issue longer-dated debt since there are willing investors.<br /><br />Having a large public debt portfolio is not such as bad thing as it can be a catalyst for economic growth. The key here is proper <strong>risk management</strong>. All they (governments) have to do is to look at what the banks and other financial institutions are doing.<br /><br />Sources:<br /><br /><a href="http://www.imf.org/external/np/mae/pdebt/2000/eng/index.htm">International Monetary Fund</a><br /><a href="http://www.fenews.com/fen50/fe-in-asia/fe-in-asia.html">Financial Engineering News</a><br /><br />Tags: <a href="http://technorati.com/tag/finance" ref="tag">finance</a> <a href="http://technorati.com/tag/derivatives" ref="tag">derivatives</a> <a href="http://technorati.com/tag/risk+management" ref="tag">risk management</a> <a href="http://technorati.com/tag/alm" ref="tag">alm</a> <a href="http://technorati.com/tag/government+debt" ref="tag">government debt</a> <a href="http://technorati.com/tag/bonds" ref="tag">bonds</a> <a href="http://technorati.com/tag/capital+markets" ref="tag">capital markets</a>]]></content:encoded>
      <pubDate>Tue, 08 Aug 2006 04:56:00 +0000</pubDate>
      <category domain="http://securityratty.com/tag/public debt">public debt</category>
      <category domain="http://securityratty.com/tag/public debt management">public debt management</category>
      <category domain="http://securityratty.com/tag/government">government</category>
      <category domain="http://securityratty.com/tag/debt">debt</category>
      <category domain="http://securityratty.com/tag/public debt portfolio">public debt portfolio</category>
      <category domain="http://securityratty.com/tag/government debt">government debt</category>
      <category domain="http://securityratty.com/tag/financial">financial</category>
      <category domain="http://securityratty.com/tag/financial markets">financial markets</category>
      <category domain="http://securityratty.com/tag/issue">issue</category>
      <source url="http://rmquant.blogspot.com/2006/08/running-government-finances-like-bank.html">Running Government Finances Like a Bank</source>
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