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Volume 2, Issue 56:  Monday, May 15, 2000

  • "Microsoft Says Flaw in Its Web Browser Offers Hackers Access to Sensitive Data"
    Wall Street Journal (05/15/00) P. B12; Bridis, Ted

    Microsoft has owned up to a flaw discovered in its Internet Explorer that could allow hackers to read the contents of cookies on a victim's system. Coding embedded in a Web address can trick the user's browser into responding to a request for a cookie as if the request came from an authorized site. Hackers can exploit the flaw to find personal information given to e-commerce sites and to access Web-based email accounts and information about past browsing. The flaw affects the two most recent versions of Explorer, meaning that about two-thirds of Web users could be affected by the problem. Cookies, used by e-commerce sites to keep track of customer purchases, sometimes include information such as customer names and site passwords. The FTC is currently investigating cookies for potential privacy problems.

  • "'Love Bug' Probe Finds Password-Stealing Program in Data Files"
    Washington Post (05/15/00) P. A13; Chandrasekaran, Rajiv

    Investigators tracking down the creator of the love bug virus discovered a number of data files on the systems of Sky Internet, an ISP in Manila, that further incriminate Filipino computer student Onel de Guzman. Among the files is a Trojan Horse program that steals Internet-access passwords--a program similar to one de Guzman described in his thesis proposal. The program is a key piece of evidence linking de Guzman to the virus, which overwhelmed email systems when it struck on May 3, costing an estimated $8 billion in damage. The virus also tried to retrieve a Trojan Horse from Sky Internet that would pull various passwords from target systems and email those passwords to an account in Jakarta. Last week de Guzman announced at a news conference that he could have accidentally launched the virus--a possibility that one tech expert compares to "accidentally sending a man to the moon."

  • "Big Test Set for Biometrics"
    American Banker (05/15/00) Vol. 165, No. 93, P. 1; Power, Carol

    Biometric technology is rapidly moving into the mainstream. Visa International and the Financial Services Technology Consortium will soon announce a joint six-month project that will test fingerprint scanning, facial scanning, and electronic signature verification. Microsoft also recently announced that it would employ fingerprint, iris, and voice recognition technology in upcoming versions of its Windows operating systems to enable more secure e-commerce transactions. Several banks have also recently been testing iris recognition devices at ATMs and fingerprint recognition technology for employee log-ons as a substitute for passwords. While biometric technology has existed for years, banks have been hesitant to embrace it due to its high cost, possible consumer complaints of privacy invasions, and a lack of agreement on what body part to use for identity purposes. However, the recent decrease in costs and greater accuracy of biometric technologies are causing more banks to investigate their use for customer security.

  • "Intel to Spin Off Company of Customized Technology"
    New York Times (05/15/00) P. C10; Barboza, David

    Intel today will unveil plans to spin off an Internet company called Developonline.com that will allow customers to order tailored technology products, in a move that brings the chipmaker into the trend of providing customized goods over the Internet. Consumers or businesses visiting the Developonline.com site can choose the features they want in Web appliances, Internet networking equipment, and cell phones. The spin off aims to speed the time to market for technology devices and to let consumers participate in designing products.

  • "AOL, Time Warner Urge Quick Approval From FCC on Merger"
    Wall Street Journal (05/15/00) P. B18

    AOL and Time Warner have sent a filing to the FCC urging the agency to "promptly" approve their proposed merger without placing any stipulations on the arrangement. The filing claims that the merger "further advances consumer choice in Internet services," noting that the combined company would allow consumers to pick from several ISPs when using its cable networks. A number of companies, consumer groups, and trade associations have recently filed comments about the proposed merger to the FCC.

  • "G8 Meeting Will Tackle Global Efforts Against Internet Crime"
    Agence France-Presse (05/14/00); Ingham, Richard

    The Group of Eight today kicks off a three-day conference on Internet crime, a timely topic considering the rash of computer attacks that have occurred this year, including the recent ILOVEYOU virus. Government officials and representatives will attend the event, being held in Paris, to discuss potential solutions to such Internet crimes as credit card fraud, cyberstalking, copyright piracy, and terrorism. Those familiar with the conference's agenda expect the talks to produce potential definitions of what constitutes Internet crime. The conference will not make any formal announcements, but will instead introduce its recommendations at the G8 summit that will be held in Okinawa, Japan, in July. Analysts will keep a close eye on the Paris talks for any indication of progress on the issue of data encryption, as well as the Council of Europe's cybercrime treaty.

  • "Next E-Security Threat: Mobile Phones"
    Reuters (05/15/00)

    Security experts contend that mobile phones will soon replace PCs as the conduit of choice for hackers launching cyberattacks over the Internet. Wireless Application Protocol technology, which enables mobile phone users to access the Internet, as well as UMTS third-generation technology, which provides high-speed access to online services, will both facilitate hacking. According to security professionals, hackers will be able to break into data banks using a mobile phone, then store the information on a laptop. Hackers could also use stolen laptops and mobile phones to send out a virus and then simply destroy the equipment afterwards, making it nearly impossible for police to locate the perpetrators. Experts warn that as mobile phones start being widely used to conduct online banking, security systems will have to be loaded onto the devices, and passwords that allow entry into private networks must be reinforced.

  • "Dot-Com Legalities Afloat in Cyberspace"
    News/400 Online (05/09/00); Moore, Joanna

    New laws are gradually being implemented to regulate the Internet, causing many online businesses to keep an eye on the courts to see how various laws are being upheld and to take a closer look at their own business practices to ensure they are not breaking any of these laws. Jurisdiction is one of the areas where e-commerce laws are being established. Past laws upheld that if a company sold goods in a state, that company is subject to the laws of that state. Online businesses, which are not limited by geographic boundaries like their regular brick-and-mortar counterparts, are finding themselves subject to the laws where they do business. Other e-businesses, notably those in the music industry, are being sued over copyright laws. MP3, a site that provides music files for transmission over the Internet, was held liable for copyright infringement by a judge in New York. The Recording Industry Association of America and several musicians had taken the music site to court for fear that the easy and free Internet access to their copyrighted music would hurt record sales. Meanwhile, e-businesses with patents have been defending their rights in court, and privacy issues have been causing online conflict, primarily when Web sites use personal information collected online to solicit individuals via questionable methods. Another area for concern is the "I agree" buttons, which are causing a small stir online because the agreements are being upheld in court as the equivalent of a digital signature. Businesses on the Internet that allow messages to be posted by users, have chat rooms, and provide email, must keep an eye on the messages sent because they can now be held liable if a complaint is made and the service does not respond. Even those companies that advertise via email must now be aware of the anti-spam laws in 17 states. Over time, as more court decisions are made, a gradual legal stability will be established online. In the meantime, e-businesses have to watch their own practices and keep up to date on the most recent court decisions.
    (You must be an AS400 Network member to access this page.)

  • "Pan-European Subscription-Free Net Access Coming Soon"
    Newsbytes (05/11/00); Gold, Steve

    AltaVista, the harbinger of unmetered access to the U.K. market, is developing a strategy to introduce a similar offering for most of Europe by year's end, according to a company spokesperson. The spokesperson would not release details about the timeframe for the proposed launch or what countries would be targeted. However, the Dow Jones wire service suggests that AltaVista is targeting France, Germany, Spain, and Italy. AltaVista President Piere Paperon stated in a May 10 interview with Dow Jones that a service will be ready for introduction in the French market by September. The pan-European rollout will offer Internet users unmetered access for a flat-rate fee, according to Dow Jones. AltaVista introduced an unmetered offering to the U.K. market in March and introduced French and Dutch portals the same month.

  • "Building Stronger Brands Through Online Communities"
    Sloan Management Review (04/00) Vol. 41, No. 3, P. 43; McWilliam, Gil

    Companies are increasingly recognizing the value of promoting a brand by building an effective online community of loyal consumers through chat rooms, bulletin boards, and forums. In most product categories, few consumers are completely loyal to one brand, so brand owners must work to create an online community that is customized to individual users, rewards users for continued support, and acknowledges the passage of time and the evolving relationship between the company and the consumer. Vendors can benefit from online communities by using members to test new product ideas and provide free feedback. By analyzing electronic discussions, companies can gain useful managerial information. Companies can use technology such as Artificial Life's STAn smart-text analyzer to retrieve and evaluate discussion information using fuzzy logic, neural networking, and statistical analyses. Community members gain from having a forum to share common interests with similar people. Tens of millions of people have joined online communities such as GeoCities, Women's Wire, and Garden.com, either for their profession, social interests, or hobbies. To build successful communities, companies should create the sense of a physical place with common rules, values, and codes of behavior. In addition, companies should encourage meaningful dialogues that lead to relationships, and should encourage all users to participate actively. Size control is an important issue because if a community grows too large, it will lose its sense of intimacy. Communities should strive to have "fractal depth," allowing subgroups to form around special interests. Community operators must also strike a balance between allowing free speech and controlling content. Brand managers need new skills to effectively manage an online community. Managers should be able to serve as community leaders, developing a shared vision, guiding new members, and encouraging participation. In addition, managers need to be able to manage volunteers who serve as chat-room hosts, moderators, and editors. Managers should also possess editorial expertise, bringing in new content sources, choosing suitable reference material, compiling directories, and archiving material on the site.

  • "Virus Prevention Efforts Now Focus on Networks"
    Interactive Week (05/08/00) Vol. 7, No. 18, P. 16; Duvall, Mel

    Security experts contend that last week's "love bug" virus proves that most antivirus software does not work, and that new products need to be developed that are more proactive. Experts say the new antivirus software must work at the network infrastructure level. Companies like Aladdin Knowledge Systems, Finjan, and Trend Micro are all currently working on "smart" antivirus software that basically isolates executable programs found in email messages until it is determined what exactly the executable programs will do. For example, if the executable program tries to do anything that has not been authorized by network administrators, such as erasing files, it is detained until it can be analyzed further. Finjan says its smart antivirus prototype model inoculated its customers against the Love Bug. However, it may be some time before these products are on the market.

  • "Worldwide E-Commerce: It's More Than a Web Site"
    InformationWeek (05/08/00) No. 785, P. 47; Bacheldor, Beth

    Global e-commerce success requires companies to partner with or acquire outright foreign companies, operate foreign sales and support offices that are staffed by local people familiar with the laws and customs of the region, and implement a robust technological infrastructure capable of supporting and integrating far-flung operations. Building a Web site is not sufficient. Due to the nature of its business, United Airlines already had offices all over the world staffed with people familiar with their region. For its global e-commerce expansion, United's first task was to supply a Web site template to local managers and allow them to supply the content relevant to customers in the region. Still, even with local offices in place, United is considering partnerships to help broaden its business far faster than it could do on its own. With new and improved Web sites operating in the United States and Britain, United plans to expand into Australia, Germany, Hong Kong, and Japan. The United States only account for 12 percent of the world's steel market, making it a necessity for online steel marketplace E-Steel.com to look beyond U.S. borders to expand the business. So far, E-Steel has partnered with steel industry companies in the Netherlands and Asia, in the hopes of easing its entry into those foreign markets. "This isn't about building a cute little Web site," says Christopher Swann, COO of GlobalFoodExchange.com. "This is a very sophisticated, difficult proposition that's much more capital-intensive with a much longer gestation period."

  • "It's a World Wide Web After All"
    Interactive Week (05/08/00) Vol. 7, No. 18, P. 64; Trager, Louis

    American business-to-consumer players on the Internet are venturing into markets abroad to better position their businesses for the hypergrowth in the global economy that is projected to occur in the next few years. For example, Amazon.com says 24 percent of its total sales in the first quarter came from Germany and the United Kingdom. Meanwhile, eBay's Kevin Pursglove says sales in foreign markets could surpass those in the U.S. in a few years. Similarly, Dataquest projects foreign sales to top U.S. sales by 2001. By 2004, Forrester expects North America to account for just 44.8 percent of the world's online sales. Emarketer projects that the U.S. will represent just 42 percent of the world's active Internet users this year. By 2003, Emarketer believes the U.S. will account for 36.9 percent of active Internet users, Western Europe will have about 30 percent, the Asia-Pacific region will have 27 percent, and Latin America will represent over 5 percent. Although the U.S. still has more than half of those buying goods over the Internet, Clay Braziller of Angus Reid says foreign markets now sell more goods in certain sectors. Braziller notes that online banking is more popular throughout Europe and South America. He also says Internet users in Asia, Latin America, and even developing countries such as Turkey and Egypt are downloading music files. U.S. companies are focusing on Europe first, but Asia is considered the next frontier. Asia had $2.8 billion in business-to-consumer sales last year, and Japan, Korea, and Australia accounted for 94 percent of the sales. The problems U.S. companies are likely to encounter as they move into new markets include doing business in different currencies, dealing with new tax rules and government regulation, prompt shipping, and language barriers.

  • "Battle Brews Over Reverse-Engineering"
    Computerworld (05/08/00) Vol. 34, No. 19, P. 46; Harrison, Ann

    Critics are furious at recent court decisions that ban developers from reverse-engineering, saying developers and users will be limited as they try to interoperate or search for flaws in commercial software. Restrictions are expected to be tightened further by the Uniform Computer Information Transactions Act, which will empower vendors with unfair leverage in contract negotiations, opponents say. The main complaint from developers and system administrators regarding such bans is that they take away the right to use products however they wish to use them. Zero-Knowledge chief scientist Ian Goldberg says, "Bugs, security holes or worse, explicit back doors, might be undetected, but only talked about within the bad guys' community."

  • "E-government? Mostly Talk So Far, Says Researcher"
    Government Computer News (05/11/00)

    The federal government is failing to provide its citizens with enough online government and electronic service initiatives, according to Fed Sources President Tom Hewitt. Hewitt, addressing the crowd at the company's recent annual Outlook conference, said Congress is nixing many new initiatives. "There's no leader pushing a technology-based budget," Hewitt said. Hewitt has a good deal of experience as a federal market watcher.
    (Access for paying subscribers only.)

  • "Tech Industry Lobbying Hard for China Trade Deal"
    SiliconValley.com (05/14/00); Puzzanghera, Jim

    A tug of war battle is being waged between the high-tech industry and labor unions, human rights advocates, and anti-communists over whether the U.S. should accept China as a member of the World Trade Organization (WTO) and grant the country permanent normal trade relations (PNTR) status. A vote in the House of Representatives is set for next week to decide the issue. The high-tech industry says if China becomes a member of the WTO, tariffs will decrease and foreigners will be allowed to own up to 49 percent of telecommunications, Internet, and financial service companies in that country-and up to 50 percent in two years. The opposition, led by the AFL-CIO, believes that trade status must be granted annually, not permanently, in order to pressure China to continue democratic reforms. Critics also say admitting China into the WTO would take jobs away from American citizens. However, the high-tech industry has not taken this sitting down. Companies in the industry have been advertising via newspapers and radio in undecided House member's districts and sending out information packets stating their case. Lobbyists and officials have been visiting Capitol Hill to make a more personal impression on members of the House, and some high-tech companies have emailed all their employees in the U.S. explaining the situation and recommending they contact their local Congress members. The larger companies have also hinted that the decisions by government officials will affect the amount given in campaign contributions in years to come. The House of Representatives, led by the Democrats, is still against admitting China, although many members are still undecided. Congress is for a trade agreement, as are President Clinton and both presidential nominees.

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