The sky is falling! Trip Chowdhry, the analyst with Global Equities Research who claimed Red Hat was ‘rubbish and the entire LAMP stack is potty, too’ published some eye-opening predictions, predominantly negative, about tech business in Silicon Valley. Now Chowdhry claims that “almost every VC funded open-source company is struggling and will run out of money within the next six months.” (Probably not the most unbiased guy about open source) Matt Asay argues that organizations in general are struggling, but open-source companies are not that high on the list. (But are they high on the VC “axe” list??) He notes Alfresco, Pentaho and JasperSoft are some of the players with ‘millions in the bank and growing revenue.’ Asay also says Chowdhry has a responsibility to do real due diligence and not create myths. Take that, Chicken Little! (img from Disney-Clipart)

We’re not as far behind as we thought we were. Google presented the results of a study they conducted about how IPv6- capable “ordinary users” are at the RIPE meeting in Dubai a few weeks ago. Turns out Apple Macs drive IPv6 penetration in the US. Fifty-two percent of all IPv6 users in the U.S. own a Mac and use 6to4 (creating IPv6 addresses from an IPv4 address and tunneling packets) – making the US fifth in the list of countries using IPv6. Russia and France took first and second place with .76 and .65 percent IPv6-enabled traffic . The US is at .45 percent. Worldwide, 0.238 percent of Google users’ systems are IPv6-enabled and prefer to use IPv6 over IPv4.

Obama’s win = Google’s win? Apparently Google CEO Eric Schmidt and President-Elect Obama are very good buddies and “this terrifies Microsoft”. Now competitors are more on guard against Google’s growing empire and popularity. Although Schmidt was mentioned as a possible candidate for the country’s new national CTO position, he said he would not accept the post if asked. I guess that’s one less thing Microsoft has to worry about.

The problem is that (Chris’ analysis is) completely impractical. I’ll take a recent, and fairly typical situation as an example. I was taking issue with the manner in which remote access was being provisioned for a third party vendor to connect to a system hosted by one of our European business units. To cut a long story short, it was not only a breach of policy but highly insecure. I wanted the access to be disconnected, the business unit director wanted my risk assessment. And he didn’t want to wait for it.

To quote Chris Hayes, spending time on working out the expected effectiveness of controls, over a given timeframe, as measured against a baseline level of force was not going to pacify an angry Italian fearful that my decision was going to cost him money. He wanted my explanation of the risk and more importantly, what I was going to offer as a solution to keep his business functioning

As Chris is someone who actually does this for a living in a large company, and this is typical of his actual day job, I really find Stuart’s “impractical” comment to be, um, misinformed.

Also, I think Stuart mistakes the purpose of a risk analysis.  The purpose of the risk analysis is not to force someone to be “secure”, but to provide knowledge for decision making.  Using it as a “hammer” to knock in the nail of your personal risk tolerance impairs efficiency and in the long run retards “security” as it creates political resentment.  Seriously, who cares if something might violate policy or not in a pre-implementation discussion?  Policies are not stone tablets handed down from on high, they are state-in-time codification of the data owners risk tolerance.  This risk tolerance changes sometimes, and that’s OK.

To that extent, I appreciate (and I’m sure Chris does, as well) that risk analysis does not create rationality in the data owner.  Someone who sees you as a speedbump on the route to progress they may not be ready to appreciate your point of view even if it is stated in the most rational manner possible.   But it’s worth noting (and Stuart’s example is indicative of this point) that risk analysis does not create rationality in the analyst, either.  If one is being so “security minded” as to ignore the risk tolerance of the business owner - we’re bound to get a reaction similar to that Stuart encountered.  In fact, a practical risk analysis like Chris performed on his blog, done in 30 minutes, should identify the critical point of disagreement between Stuart and the data owner (again, Stuart doesn’t own the data, the agitated Italian does).

But let’s stay rational and open to alternatives to what Chris offers.  Stuart states his approach to risk analysis as:

When I need to document a risk assessment I use a very simple form: list the threats, state the level of vulnerability, list the associated operational costs and potential revenue hits. High, medium, or low risk? Describe the controls and options. Write up who needs to do what, and how much of their time it’s going to take. Job done.

At first glance, I don’t think what Chris has done is any less efficient, and it provides greater insight (using Frequency and Capability instead of just ‘listing the threats’).  But what is key here is that Chris’ approach is consistent and defensible.  Less generous risk geeks and CSO’s I know would have no little difficulty with Stuart’s approach.  But to particularly answer Stuart’s main objection (impracticality) I would offer that with practice, Chris’ work is probably quicker and easier than Stuart’s described process as it eliminates much of the ambiguity an immature risk analysis creates - reducing the need for further discussion and arguments with data owners (regardless of disposition or nationality).

Finally the irony of Stuart’s post is that the reason he had this confrontation may in fact be because he was incapable of bringing a salient model for risk to the table, one that identified the factors that create risk and developed a defensible belief statement concerning risk.   We’ll never know if one would have helped him in this isolated instance, but I can tell you that in organizations like Chris’, good risk models and strong risk anlayses create operational efficiencies, reduce costs, and streamlines intra-departmental communications.

What an interesting time to hold a technology conference. The DLA Piper Global Technology Leaders Summit last week brought together CXOs from Amazon, Walmart.com, Stanford, Safeway, Microsoft, Sun, Cisco and others to discuss the state of IT in general and how the economy is impacting it. Some highlights:

“Cloud computing for large enterprises is a dead duck, in the opinion of several venture capital firms.”

“The current slowdown in the U.S. macroeconomy is definitely going to hurt the IT industry, as it will most of the nation’s businesses, for at least the next year and most likely into the next two years.”

NetApp cancelled its first user conference slated for 2009 citing economy-driven restrictions on business travel.

We recently wrote about the possible upside for MSPs in this economic downtown. A survey from EquaTerra of more than 200 outsourcing service suppliers announced that “more than 40 percent of those polled had seen increased demand levels, despite the economic downturn.” The survey suggests that outsourcing projects are changing, with a strong focus on quick return on investment replacing longer-term initiatives to improve end-to-end business processes, according to InfoWorld. So as we saw during our own surveys this year, it looks like IT will spend time and money against the practical projects that should and could get done and not taking on ITIL and CMDB projects.

Jonathan Schwartz as a puppet talking about open source and his ponytail. The driest Sesame Street take-off you’ll ever see. Check out the video here. For those of you playing a drinking game at home, “ponytail”.

Denise Dubie posted a follow up to her article Novell’s Managed Objects buy, and shared insights from different commenters, including yours truly.

One of our favorites, the IT Skeptic was featured on John Willis’ blog this week, answering some questions about CMDB, ITSMF and more. He also provided his insight into IBM Tivoli, although he “tries to stay non-partisan”.

Inexplicable. HP posted Halloween-themed videos about datacenters on YouTube this week. Unlike the great IBM videos about the mainframe, these videos speak techno-babble without tempering the lingo with being funny or tongue-in-cheek. Various frightening creatures share information on service management processes and discuss virtualization techniques to help consolidate hardware. Scary.

[Q] I have been collecting accounts of your meeting with David Petraeus in Baghdad. And you had [inaudible] after he had made a really strong pitch [inaudible] for maximum flexibility. A lot of politicians at that moment would have said [inaudible] but from what I hear, you pushed back.

[BO] I did. I remember the conversation, pretty precisely. He made the case for maximum flexibility and I said you know what if I were in your shoes I would be making the exact same argument because your job right now is to succeed in Iraq on as favorable terms as we can get. My job as a potential commander in chief is to view your counsel and your interests through the prism of our overall national security which includes what is happening in Afghanistan, which includes the costs to our image in the middle east, to the continued occupation, which includes the financial costs of our occupation, which includes what it is doing to our military. So I said look, I described in my mind at list an analogous situation where I am sure he has to deal with situations where the commanding officer in [inaudible] says I need more troops here now because I really think I can make progress doing x y and z. That commanding officer is doing his job in Ramadi, but Petraeus's job is to step back and see how does it impact Iraq as a whole. My argument was I have got to do the same thing here. And based on my strong assessment particularly having just come from Afghanistan were going to have to make a different decision. But the point is that hopefully I communicated to the press my complete respect and gratitude to him and Proder who was in the meeting for their outstanding work. Our differences don't necessarily derive from differences in sort of, or my differences with him don't derive from tactical objections to his approach. But rather from a strategic framework that is trying to take into account the challenges to our national security and the fact that we've got finite resources.

I have made this general point again and again -- about airline security, about terrorism, about a lot of things -- that the person in charge of the security system can't be the person who decides what resources to devote to that security system. The analogy I like to use is a company: the VP of marketing wants all the money for marketing, the VP of engineering wants all the money for engineering, and so on; and the CEO has to balance all of those needs and do what's right for the company. So of course the TSA wants to spend all this money on new airplane security systems; that's their job. Someone above the TSA has to balance the risks to airlines with the other risks our country faces and allocate budget accordingly. Security is a trade-off, and that trade-off has to be made by someone with responsibility over all aspects of that trade-off.

I don't think I've ever heard a politician make this point so explicitly.

The idea behind quantum crypto is that two people communicating using a quantum channel can be absolutely sure no one is eavesdropping. Heisenberg's uncertainty principle requires anyone measuring a quantum system to disturb it, and that disturbance alerts legitimate users as to the eavesdropper's presence. No disturbance, no eavesdropper -- period.

This month we've seen reports on a new working quantum-key distribution network in Vienna, and a new quantum-key distribution technique out of Britain. Great stuff, but headlines like the BBC's "'Unbreakable' encryption unveiled" are a bit much.

The basic science behind quantum crypto was developed, and prototypes built, in the early 1980s by Charles Bennett and Giles Brassard, and there have been steady advances in engineering since then. I describe basically how it all works in Applied Cryptography, 2nd Edition (pages 554-557). At least one company already sells quantum-key distribution products.

Note that this is totally separate from quantum computing, which also has implications for cryptography. Several groups are working on designing and building a quantum computer, which is fundamentally different from a classical computer. If one were built -- and we're talking science fiction here -- then it could factor numbers and solve discrete-logarithm problems very quickly. In other words, it could break all of our commonly used public-key algorithms. For symmetric cryptography it's not that dire: A quantum computer would effectively halve the key length, so that a 256-bit key would be only as secure as a 128-bit key today. Pretty serious stuff, but years away from being practical. I think the best quantum computer today can factor the number 15.

While I like the science of quantum cryptography -- my undergraduate degree was in physics -- I don't see any commercial value in it. I don't believe it solves any security problem that needs solving. I don't believe that it's worth paying for, and I can't imagine anyone but a few technophiles buying and deploying it. Systems that use it don't magically become unbreakable, because the quantum part doesn't address the weak points of the system.

Security is a chain; it's as strong as the weakest link. Mathematical cryptography, as bad as it sometimes is, is the strongest link in most security chains. Our symmetric and public-key algorithms are pretty good, even though they're not based on much rigorous mathematical theory. The real problems are elsewhere: computer security, network security, user interface and so on.

Cryptography is the one area of security that we can get right. We already have good encryption algorithms, good authentication algorithms and good key-agreement protocols. Maybe quantum cryptography can make that link stronger, but why would anyone bother? There are far more serious security problems to worry about, and it makes much more sense to spend effort securing those.

As I've often said, it's like defending yourself against an approaching attacker by putting a huge stake in the ground. It's useless to argue about whether the stake should be 50 feet tall or 100 feet tall, because either way, the attacker is going to go around it. Even quantum cryptography doesn't "solve" all of cryptography: The keys are exchanged with photons, but a conventional mathematical algorithm takes over for the actual encryption.

I'm always in favor of security research, and I have enjoyed following the developments in quantum cryptography. But as a product, it has no future. It's not that quantum cryptography might be insecure; it's that cryptography is already sufficiently secure.

This essay previously appeared on Wired.com.

EDITED TO ADD (10/21): It's amazing; even reporters responding to my essay get it completely wrong:

Keith Harrison, a cryptographer with HP Laboratories, is quoted by the Telegraph as saying that, as quantum computing becomes commonplace, hackers will use the technology to crack conventional encryption.

"We have to be thinking about solutions to the problems that quantum computing will pose," he told the Telegraph. "The average consumer is going to want to know their own transactions and daily business is secure.

"One way of doing this is to use a one time pad essentially lists of random numbers where one copy of the numbers is held by the person sending the information and an identical copy is held by the person receiving the information. These are completely unbreakable when used properly," he explained.

The critical feature of quantum computing is the unique fact that, if someone tampers with an information feed between two parties, then the nature of the quantum feed changes.

This makes eavesdropping impossible.

No, it wouldn't make eavesdropping impossible. It would make eavesdropping on the communications channel impossible unless someone made an implementation error. (In the 80s, the NSA broke Soviet one-time-pad systems because the Soviets reused the pad.) Eavesdropping via spyware or Trojan or TEMPEST would still be possible.

The idea behind quantum crypto is that two people communicating using a quantum channel can be absolutely sure no one is eavesdropping. Heisenberg's uncertainty principle requires anyone measuring a quantum system to disturb it, and that disturbance alerts legitimate users as to the eavesdropper's presence. No disturbance, no eavesdropper — period.

This month we've seen reports on a new working quantum-key distribution network in Vienna, and a new quantum-key distribution technique out of Britain. Great stuff, but headlines like the BBC's "'Unbreakable' encryption unveiled" are a bit much.

The basic science behind quantum crypto was developed, and prototypes built, in the early 1980s by Charles Bennett and Giles Brassard, and there have been steady advances in engineering since then. I describe basically how it all works in Applied Cryptography, 2nd Edition (pages 554-557). At least one company already sells quantum-key distribution products.

Note that this is totally separate from quantum computing, which also has implications for cryptography. Several groups are working on designing and building a quantum computer, which is fundamentally different from a classical computer. If one were built — and we're talking science fiction here — then it could factor numbers and solve discrete-logarithm problems very quickly. In other words, it could break all of our commonly used public-key algorithms. For symmetric cryptography it's not that dire: A quantum computer would effectively halve the key length, so that a 256-bit key would be only as secure as a 128-bit key today. Pretty serious stuff, but years away from being practical. I think the best quantum computer today can factor the number 15.

While I like the science of quantum cryptography — my undergraduate degree was in physics — I don't see any commercial value in it. I don't believe it solves any security problem that needs solving. I don't believe that it's worth paying for, and I can't imagine anyone but a few technophiles buying and deploying it. Systems that use it don't magically become unbreakable, because the quantum part doesn't address the weak points of the system.

Security is a chain; it's as strong as the weakest link. Mathematical cryptography, as bad as it sometimes is, is the strongest link in most security chains. Our symmetric and public-key algorithms are pretty good, even though they're not based on much rigorous mathematical theory. The real problems are elsewhere: computer security, network security, user interface and so on.

Cryptography is the one area of security that we can get right. We already have good encryption algorithms, good authentication algorithms and good key-agreement protocols. Maybe quantum cryptography can make that link stronger, but why would anyone bother? There are far more serious security problems to worry about, and it makes much more sense to spend effort securing those.

As I've often said, it's like defending yourself against an approaching attacker by putting a huge stake in the ground. It's useless to argue about whether the stake should be 50 feet tall or 100 feet tall, because either way, the attacker is going to go around it. Even quantum cryptography doesn't "solve" all of cryptography: The keys are exchanged with photons, but a conventional mathematical algorithm takes over for the actual encryption.

I'm always in favor of security research, and I have enjoyed following the developments in quantum cryptography. But as a product, it has no future. It's not that quantum cryptography might be insecure; it's that cryptography is already sufficiently secure.

---

Bruce Schneier is chief security technology officer of BT. His new book is Schneier on Security.