Last week, the US Senate passed the USICA (The United States Innovation and Competition Act) which includes the CHIPS for America Act. Despite what the title of the USICA and its sub articles might suggest, the policy is largely a manifesto for dealing with a rising and highly competitive China with particular concern for the Western rival’s ambition to achieve semiconductor self-sufficiency and Huawei’s ascension as the leading 5G technology vendor. The Act presents several concrete policy measures to diminish China’s access to US semiconductor technologies and 52 billion USD in federal funding to build a more resilient semiconductor supply chain. But will these policies help the US achieve what the title of the USICA suggest; improve US semiconductor supply chain resiliency and competitiveness in 5G? Will it stop the technological advancement of China and its digital economy long enough for the West to tame it?Continue reading
On December 18th, 2020, SMIC (Semiconductor Manufacturing International Company), China’s largest foundry, was added to the Bureau of Industry and Security’s (BIS) Entity List. This was not a surprising move by the US Department of Commerce given the increasing stringency and aggressiveness of the Trump Administration’s tech trade policy toward China over the last couple of years, especially with the advent of the Coronavirus Pandemic. Besides, Secretary Wilbur Ross indicated in September that SMIC would likely join Huawei on the BIS’s Entity List. What are the implications on the semiconductor industry and the future of 5G?Continue reading
The US Department of Commerce recently amended its foreign-produced direct product rule (FPDP) and Entity List to include HiSilicon, Huawei’s semiconductor design subsidiary. This action has been widely deemed an escalation of the US government’s “war on Huawei. In the broader context of the US sanction on Chinese tech firms, the addendum applies a consistency of “national security and foreign policy purpose” to HiSilicon.Continue reading
We have come a long way in a short time since COVID-19 emerged from Wuhan, China late last year. The virus has stealthily yet rapidly evolved from a provincial epidemic to a pandemic that is suffocating the largest and the smallest of economies around the globe.Continue reading
While the White House has touted a major victory in the trade war with China with the signing of a so-called “Phase One” deal, it was difficult not to notice the very visible absence of Chinese President Xi Jinping himself. Instead, the Trump Administration received a congratulatory letter from President Trump’s Chinese counterpart read by Vice Premier Liu He, a level-three member of the Chinese Politburo.Continue reading
The global race for 5G is on with operators in advanced markets such as the US, South Korea leading the way with the first deployments of 5G networks in their respective markets. Given all the excitement and hype that has shrouded 5G over the last couple of years, telecom operators around the world are under pressure to jump on the 5G bandwagon as governments push to position their economies for the digital era. Especially for the U.S. and China, 5G has become a strategic economic imperative that both countries believe will determine the economy and doctrine that will lead in our digital future. But what does the 5G race mean for the emerging and developing markets? Do operators in these markets have the opportunity to rethink the network to enable new economic possibilities in the era of 5G?Continue reading
The big story yesterday afternoon was Tim Cook’s surprise letter to investors announcing that Apple’s Q1 2019 revenue would come in far below the $89 to $93 billion guidance that it issued back on November 1st of 2018. Tim rattled off numerous factors that promoted Apple to issue a revenue warning one month prior their first earnings call of 2019. The most prominent factor – China.Continue reading
neXt Curve attended the World Internet Conference 2018 in Wuzhen, China’s premier conference on the digital economy and policy, which took place from the 6th to the 9th of November. This year’s conference was sparsely attended by U.S. tech giants such as Apple and Google, but their absence didn’t put a damper on the global scope of the event and its continued promotion of the Digital Silk Road.Continue reading
On October 4th, 2018, Bloomberg’s Businessweek released a report alleging that Chinese spies implanted a “malicious chip” into server motherboards assembled by Super Micro Computer Inc. (Supermicro), a U.S.-based Original Device Manufacturer (ODM) that manufactures servers used in hyperscale data centers. Growing national security threats are increasingly putting enterprises at risk as the bare-metal of our digital infrastructure depends on a supply chain highly influenced and exposed to the Chinese government.
If Bloomberg’s allegations prove true, digital business leaders have yet another proof point that security matters and is vital to the ongoing integrity of their business in an increasingly digital economy. Considering that Supermicro is one of the largest manufacturers of servers by annual shipments and the largest ODM according to research firm, IDC, the scope of the “spy chip” vulnerability could be broad. But what do enterprises do now? The digital equipment supply chain will not change overnight.
Hardware-Level Security Vulnerabilities are Growing and Threatening the Foundation of Our Digital Economy
According to the Bloomberg report “The Big Hack: How China Used a Tiny Chip to Infiltrate U.S. Companies”, the malicious hardware implant (a.k.a. malicious chip) was detected by Amazon’s AWS engineers during their acquisition of the video compression firm Elemental Technologies, which leveraged Super Micro Computer’s servers for their on-premise platform offerings.
This malicious chip implant allegedly interrupts instructions to an affected server’s Baseboard Management Controller (BMC) whereby a rogue administrator could gain remote access to the server through a firmware update malware and potentially impact virtual and other physical servers sitting on a data center’s network.
What is concerning, if true, is these hardware vulnerabilities, including proven vulnerabilities like Meltdown, Spectre and Foreshadow could be leveraged to attack data centers by breaking traditional security boundaries and safeguards.
For instance, a hacker could use these hardware-level vulnerabilities to create a malware or hack method to log into a cloud service and potentially scan memory and processor cache to gain visibility to other users’ personal data, company intellectual property and/or acquire access to applications and virtual machines hosted on the same affected physical server. This type of threat exposes a business to a profound risk of personal and confidential data and content being compromised and stolen.
AI-based Behavioral Analytics – The Centerpiece of the Holistic Security Platform
If the Chinese “malicious chip” threat is considered in isolation it would seem – as represented in the Bloomberg report – there is no viable solution to the problem. As Bloomberg reporter, Jordan Robertson, stated in an interview with Emily Chang, “The Chinese government installed malicious microchips on Supermicro-assembled server motherboards. What a malicious microchip is, think about it as an infection that is hardcoded into your computer. You cannot get rid of it without throwing the machine away.”
However, the Bloomberg report intentionally or unintentionally hints and/or alleges that Amazon and Apple identified affected servers and monitored them for malicious activities (hack/breach incidents) prior to removing them from their data centers, suggesting the use of holistic security methods to identify and contain a threat that exploits the “malicious chip” vulnerability. Spot on!
Going forward businesses need to take a new, holistic approach to security. Traditional mindsets and approaches to enterprise security will be insufficient as rabid interest and investment in IoT and 5G by enterprises around the world expand the cyber-risk landscape. However, based on our own research at neXt Curve, we have observed significant gaps in security capabilities and frameworks needed to address future bare-metal-to-edge security threats in a rapidly converging and expanding ICT universe.
One of the key technologies needed to fill the many holistic security capability gaps is AI-based behavioral analytics. It is an emerging technology that is a critical element of a holistic security strategy and platform whereby standard (what is normal) profiles and behaviors of users and entities/resources (hosts, applications, and data repositories) and activities (network traffic and compute processes) are defined, and anomalous activity is analyzed, flagged, and quarantined or processes killed if needed.
While behavioral analytics may reside at the core of a holistic security solution framework, additional capabilities and services will need to be integrated in order to realize visibility and control over an enterprise’s internal and external digital infrastructure and environments. Additional solution components will range from cloud access security brokering, integrated endpoint and network service management, security information and event management (SIEM), to intelligent firewalls with DPI (deep packet inspection) for DLP: data loss prevention and content filtering.
Securing the network and software is not good enough anymore. Enterprises need to think of security from bare metal in the data center to the cloud to the endpoint devices that deliver the digital value we all love so much. It’s time to think differently about digital security.
Implications for Business Leaders
CISOs, CTOs and CIOs need to think of security holistically and consider new approaches to address an expanding field of profound hardware-level threats like Meltdown, Spectre and the tampering of hardware exemplified by the alleged Chinese “malicious chip” server sabotage. The management of risk will require ensuring that both internal and external resources and infrastructures are vetted whether they are enterprise-managed or managed by a 3rd party service provider.
The C-Suite and the board need to understand the significant risks that processor-level vulnerabilities will have on their business and on their digital strategy. It will be critical to bring cybersecurity competencies and a robust agenda into the boardroom to effectively manage and govern the expanding and deepening sea of digital threats facing enterprises today and into the foreseeable future.
Technology vendors have an opportunity to connect the dots and bridge existing and emerging technologies into a holistic security platform. This will require traditional vendors and service providers to venture outside of their silos and partner with holistic security ecosystem plays or lead by example with newer innovations.