EarthLink announced its most recent quarter's earnings a few days ago, and they managed to turn a GAAP profit, while staunching the bleeding of so many businesses that had no short-term and seemingly little medium-term potential for net revenue. The company dramatically slashed its marketing, which they found only caused subscribers to join and quit. While revenue dropped from $290m to $235m year over year in Q1, operating costs and expenses were cut from $321m to $198m, with the most noticeable drop in sales and marketing ($99m to $31m) and operations and customer support ($60m to $39m). They recorded $58m in earnings versus a year ago's $22m loss.

Employees dropped from 2,108 to 922 during the period, while subscribers dropped from 5.7m to 3.6m. But it's worth noting that the biggest drop happened last year already: the 31-Dec-2007 subscriber count was 3.9m. They're making slightly more money from each of those remaining customers, and have slightly lower churn. Their municipal write-off is lower, too, as they've taken most of the expense, and have offloaded more and more of their future obligations.

The company still has the same problem that it had before it started unwinding its services beyond dial-up and broadband: None of its markets are expanding, and it has increasingly poor access to reasonably priced broadband to resell to customers, as no cable or DSL providers are obligated to provide true wholesale rates.

On Wednesday, in New Orleans, US Central Intelligence Agency senior analyst Tom Donahue told a gathering of 300 US, UK, Swedish, and Dutch government officials and engineers and security managers from electric, water, oil & gas and other critical industry asset owners from all across North America, that "We have information, from multiple regions outside the United States, of cyber intrusions into utilities, followed by extortion demands. We suspect, but cannot confirm, that some of these attackers had the benefit of inside knowledge. We have information that cyber attacks have been used to disrupt power equipment in several regions outside the United States. In at least one case, the disruption caused a power outage affecting multiple cities. We do not know who executed these attacks or why, but all involved intrusions through the Internet."

According to Mr. Donahue, the CIA actively and thoroughly considered the benefits and risks of making this information public, and came down on the side of disclosure.

I'll bet. There's nothing like an vague unsubstantiated rumor to forestall reasoned discussion. But, of course, everyone is writing about it anyway.

SANS's Alan Paller is happy to add details:

In the past two years, hackers have in fact successfully penetrated and extorted multiple utility companies that use SCADA systems, says Alan Paller, director of the SANS Institute, an organization that hosts a crisis center for hacked companies. "Hundreds of millions of dollars have been extorted, and possibly more. It's difficult to know, because they pay to keep it a secret," Paller says. "This kind of extortion is the biggest untold story of the cybercrime industry."

And to up the fear factor:

The prospect of cyberattacks crippling multicity regions appears to have prompted the government to make this information public. The issue "went from 'we should be concerned about to this' to 'this is something we should fix now,' " said Paller. "That's why, I think, the government decided to disclose this."

More rumor:

An attendee of the meeting said that the attack was not well-known through the industry and came as a surprise to many there. Said the person who asked to remain anonymous, "There were apparently a couple of incidents where extortionists cut off power to several cities using some sort of attack on the power grid, and it does not appear to be a physical attack."

And more hyperbole from someone in the industry:

Over the past year to 18 months, there has been "a huge increase in focused attacks on our national infrastructure networks, . . . and they have been coming from outside the United States," said Ralph Logan, principal of the Logan Group, a cybersecurity firm.

It is difficult to track the sources of such attacks, because they are usually made by people who have disguised themselves by worming into three or four other computer networks, Logan said. He said he thinks the attacks were launched from computers belonging to foreign governments or militaries, not terrorist groups."

I'm more than a bit skeptical here. To be sure -- fake staged attacks aside -- there are serious risks to SCADA systems (Ganesh Devarajan gave a talk at DefCon this year about some potential attack vectors), although at this point I think they're more a future threat than present danger. But this CIA tidbit tells us nothing about how the attacks happened. Were they against SCADA systems? Were they against TCP/IP systems? Were they against Windows? Insiders may have been involved, so was this a computer security vulnerability at all? We have no idea.

Cyber-extortion is certainly on the rise; we see it at Counterpane. Primarily it's against fringe industries -- online gambling, online gaming, online porn -- operating offshore in countries like Bermuda and the Cayman Islands. It is going mainstream, but this is the first I've heard of it targeting power companies. Certainly possible, but is that part of the CIA rumor or was it tacked on afterwards?

And here's list of power outages. Which ones were hacker caused? Some details would be nice.

I'd like a little bit more information before I start panicking.