SECURITY

“A Moment of Reckoning”

The U.S. is grappling with one of its biggest data breaches ever. Yesterday, officials warned that the still-unfolding cyberattack poses “a grave risk to the federal government.”

What we know so far

The hackers, who used multiple attack vectors, are thought to be working at the Kremlin’s behest. They compromised U.S. systems through a supply chain attack on network management company SolarWinds. Over 18,000 private-sector and government users downloaded a corrupted software update from SolarWinds, letting snoopers sniff around for months. They didn’t pursue all 18,000 targets, just the biggest ones. 

Last night, Microsoft said it, too, was breached. Intruders leveraged its cloud, a source told Reuters, but aren’t suspected of using Azure services to stage other attacks. 

The hackers are also known to have monitored data/emails of the Defense, Commerce, Homeland Security, State, and Treasury Departments. Add the Energy Department and the National Nuclear Security Administration to that list, per a Politico update yesterday. And three states, according to Bloomberg. And the city of Austin, TX, The Intercept reported. 

• Important note: Malware was “isolated to business networks only” and didn’t impact U.S. national security, the Energy Department says. 

Looking back

The U.S. has invested heavily in beacons and automated detection methods to stop unauthorized federal network visitors in their tracks. Those tripwires weren’t triggered, ranking this attack “among the greatest intelligence failures of modern times,” per the NYT. 

Microsoft President Brad Smith said the “latest cyber-assault is effectively an attack on the U.S. and its government and other critical institutions, including security firms.” Nation-state attackers are increasingly sophisticated and augmented by AI, he noted. 

What’s next? 

It’s not clear what data was accessed or exfiltrated in this sweeping espionage campaign. A full postmortem could take years. In the meantime, former Homeland Security Adviser Tom Bossert recommended that President Trump and President-elect Biden work together to bring the crisis under control. 

• “We are sick, distracted, and now under cyberattack. Leadership is essential,” Bossert wrote in the NYT. 

ANTITRUST

Everything’s Bigger in Texas

Accusations in court are no exception to the rule. 

On Wednesday, ten state AGs led by Texas Attorney General Ken Paxton filed an antitrust lawsuit against Google. The charges: Google built the “largest electronic trading market in existence,” fixed ad pricing, and levied “monopoly tax” on publishers that was handed down to consumers. 

• The states also make an explosive claim, accusing Google of entering into an “unlawful agreement” with Facebook. Does Texas have a smoking gun? TBD.
• Texas also claims FB gave Google access to the contents of end-to-end encrypted WhatsApp communications. That...isn’t possible. 
• Google says the “ad tech claims are meritless” and that the AGs mischaracterized a WhatsApp backup service (which isn’t E2E encrypted).  

On Thursday, 35 states separately sued Google, saying it manipulates search results to disadvantage rivals. 

Way bigger picture

As 2020 draws to a close, competition authorities aren’t mailing it in. Big activity in recent memory: DOJ and states vs. Google (three total); FTC and states vs. Facebook (two total); new EU legislation proposals for online platforms (two laws); and China drafting anti-monopoly rules (with Alibaba and Tencent in mind).

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Connected, Secured, Automated

Those are three of the things that Cisco can do for your business. Let’s break it down.

Connected: As in, whether your workforce is at home, in the office, or both, Cisco can keep everyone in touch and working efficiently.

Secured: IT and cybersecurity has never been more complicated, but Cisco has the tools and expertise to keep the goods out of the hands of bad people.

Automated: As the world around us changes and shifts, Cisco can help your business automate processes to make your modern workforce resilient and agile.

And if we had to add another to the list? Resilience. Whether you're a megacorp or a small business, Cisco has the tools you need to weather any storm that might arise in 2021 and beyond. 

Learn more about how Cisco can make your business truly resilient.

BIG TECH BEEF

Trouble in Paradise

On Wednesday and Thursday, Facebook (ironically) took out full-page ads this week in the New York Times, Washington Post, and Wall Street Journal. The purpose? Apple-bashing. FB says forthcoming privacy changes in iOS 14 will hurt small businesses and creators...and “change the internet as we know it—for the worse.”

Let’s turn down the PR knob 

Apple is prepping a software update that alerts users of apps’ data tracking capabilities—and lets them opt out. That will materially impact FB by reducing data collection and ad targeting. 

Apple says it’s a pro-consumer move. Maybe so, but it’s also one that will help a certain someone’s competitive moat. Many apps will have to pivot from ad to subscription models, and in turn, pay the App Store’s 30% cut. 

• FB also said it’s pitching in for Epic Games’s legal battle against Apple (which Spotify and Match Group have applauded). 

Big picture: Once upon a time, Big Tech companies carved up their own fiefdoms and largely left each other alone. 

BITS & BYTES

Stat: Aurora has sent offers to more than 75% of Uber Advanced Technologies Group, TechCrunch reports. Members of ATG’s key R&D lab in Toronto didn’t make the cut. 

Quote: “Baker’s rejection...is deeply troubling because this technology supercharges racial profiling by police and has resulted in the wrongful arrests of innocent people.”—Boston Celtics players, urging MA Governor Charlie Baker to sign a bill banning facial recognition in Boston Globe Opinion.

Read: The 411 on the future, from a bunch of emerging tech experts.

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WHAT ELSE IS BREWING

• Coinbase confidentially filed for an IPO. So did UiPath, a robotic process automation decacorn. 
• Alibaba’s cloud division developed facial recognition software to identify members of the Uighur ethnic minority, per IPVM and the NYT. 
• Mong-song Liang, co-CEO of SMIC, China’s largest chipmaker, is resigning. 
• Germany declined to issue an outright ban of Huawei but will insist on stringent security checks of the gearmaker’s security protocols. 
• Apple expects to produce 96 million iPhones in H1 2021, driven by 5G demand, Nikkei reports. That would be a 30% year over year increase.
• Walmart and Gatik will start fully driverless deliveries next year. Meanwhile, Motional and Lyft are targeting 2023 for the launch of a multi-city U.S. robotaxi service. 

GOING PHISHING

Three of the following news stories are true, and one...we made up. Can you spot the odd one out?

1. The U.S. Air Force completed its first flight with an AI co-pilot, which controlled onboard sensor- and navigation systems. 
2. People are creating “Grinch bots” to buy up PS5 consoles.  
3. Facebook has developed TLDR, an AI tool that summarizes a news article in bullet points, Buzzfeed News reports. 
4. Amazon is reportedly planning to take Apple’s side in the iPhone-maker’s Facebook beef. 

MARKET RESEARCH

It seems like half of the Bay Area has decamped for Austin or Florida. But Big Technology tosses cold water on that theory, using new LinkedIn data on tech workers. 

• The biggest gains in inflow-outflow ratio: Madison, Cleveland, Sacramento, Minneapolis-St. Paul, and Hartford. 
• SF and NYC have had the largest declines in inflow-outflow ratio, with rates of -35.3% and -20.1%, respectively. 

Give the full article a read. 

ICYMI

Catch up on the top Emerging Tech Brew stories from the past few editions: 

• OpenAI turns five: a Q&A with cofounder Greg Brockman
• New announcements from the FTC and European Commission
• Strava releases annual fitness data

GOING PHISHING ANSWER

There are no whispers of Amazon siding with Apple in the feud with Facebook.