You're watching "bloomberg west." it has been 10 months since edward snowden first release details of the bulk data collection programs.
Policy leaders on -- unveiled a bill on capitol hill as president obama spoke and mentioned his own proposal to come in a matter of days.
Is this bill the major rollback of the nsa that telecom was looking for?
Or is this not enough?
It depends on who you ask.
By no means is this a total rollback, but the change in approach is significant enough that it should ease concerns over the current practices.
What the house bill is proposing would put an end to that and would keep the records within the phone companies.
Instead of the nsa free-for-all that we have had, the government would need to issue specific directives requesting data and the searches would stay within u.s. carriers.
By no means is this a total rollback, but it is a big change and because we are talking about different means to the same end, what mike rogers, one of the authors of the bill says, the means are different enough to balance security and privacy concerns.
We think we have found a way to end the bulk collection of telephone metadata and still provide a mechanism to protect the united states and track those terrorists who are calling in to the united states to commit acts of terror.
So, there you have it.
They think they have found a way to sort of solved the privacy versus security question.
Of course, we are going to dissect this bill in the days to come, but that is what we have for now.
What about the president's plan?
What about his timeline?
That is right, this comes as the white house is supposed to announce that it will also be unveiling its own legislative proposal.
It is expected to look much like a house bill.
President obama speaking in the hague gave us a preview.
Take a listen.
I am confident that it allows us to do what is necessary in order to deal with the dangers of a terrorist attack, doing so in a way that addresses the concerns that people have raised.
I am looking forward to working with congress to make sure that we go ahead and pass the enabling legislation quickly so that we can get on with the business of effective law enforcement.
So, the president wants to move this quickly.
The order authorizes the current nsa phone program expiring at 5 p.m. on friday.
The president is expected to renew that legal authority for another three months to give them time to hash this all out.
Speaking of security, really fascinating study out today about the number of hack attacks being sold on the black market.
And it is the other half of the equation, where we always talk about personal security issues and occasional business issues.
The other half of it, what drives it?
What pays for it?
It is fairly interesting in a lot of ways.
It is not one master criminal out there trying to gather stuff for some kind of purpose, but rather it is people trying to create a market lace for information that would have value.
With more details on that story, cyber criminals from the u.s. to russia and the ukraine, buying and selling services for hacking.
Some of the tools sell for up to $300,000 according to a new report from juniper networks, looking into how these markets are set up and managed.
The lead author of the report, lillian, joins us now from los angeles.
So, what are the most common things sold?
How much do they cost?
There are a range of products on these black market.
They range from products that enable initial access to get onto a target box to actual payloads that get sent onto the target.
Infrastructure to make sure that attacks can happen as they are supposed to.
As a service model, if you cannot do it yourself, hire someone to do it for you.
Once you take back the stolen data or information, the service is to turn the money or stolen data into cash.
The product slate is diverse and really depends on what particular person or entity it is trying to go after.
Apple, i mean give us one example of the most sort of crazy thing or surprising thing that you saw on the black market . 10 years, 15 years ago, the markets for cyber crime and stolen data were from protests -- were composed of ad hoc groups of individuals motivated by ego and notoriety.
They just wanted to get onto systems.
Now these markets are composed of highly organized, highly sophisticated groups, often connected with traditional crime groups.
The infrastructure is set up for them.
There is a very specific hierarchy and tear of who does what and when and where.
It is easy for anyone to get involved and there really is a low cost to enter.
Something like target -- please, go on.
Sure, thank you.
Something like target, where 7 million user accounts were stolen, the data from that appeared within days on black market sites.
It is almost instantaneous.
How do the hackers find these tools?
When i search on google for cyber attack tools, i find this study.
How do they find these things?
There are different tiers of access.
There are google guides for how to buy and sell the cards or how to use exploit kits.
Youtube videos and guides that tell you how to do this.
Certainly, there are places on the open internet that you, i, or anyone could go to.
More of the sophisticated tiers, where the most sophisticated tools and freshest data is available are in more closed off sites.
More around the dark net.
Something behind encryption and anonymity capabilities.
In order to get access to those, reputation and abetting matters a great deal.
You really need that in order to get this kind of access.
Lillian, what are authorities doing to crack down on these kinds of networks?
These guys are obviously expert at hiding themselves.
How can governments chase them?
I know that there are cross-border issues as well.
These markets are empowering cyber crime and cyber criminals.
This is absolutely something we need to think about more.
Now that we have the landscape of what these markets look like, which was the intention of this report and research that we did, what should we do?
We wanted to get a copy has of understanding, so we spoke to folks that range from academics to security researchers, law enforcement personnel reporters, and even those directly involved in these marketplaces.
We have learned that law-enforcement is really getting better.
In the last 10 years to 15 years , more digital natives are entering law enforcement.
They are more savvy with technology.
There are better partnerships and cross pollination's between groups and organizations.
Law enforcement is getting better.
Because it is so easy to get involved, more cyber criminals are getting involved.
There is a little bit more action that can be seen.
Also, criminals are going after bigger targets.
These are great things that we need to be aware of and thinking about, law enforcement is getting better.
Elena, at the rand corporation.
Thank you for breaking it down for us.
Coming up, major partnerships at google glass that could give it broader appeal, still ahead on "bloomberg west.
A --." ? welcome back to "bloomberg west." google is hoping to make a google glass more stylish.
They have teamed up with the group that owns oakley and ray-ban sunglasses brands.
They hoping to distribute new versions of group -- of google glass.
It is expected to be available to mainstream consumers later this year.
Now for more on our weeklong series on the role of architectural design today.
As he sits in front of the new bay bridge, which you cross every day.
Once in a while.
What do you think of it?
It is all right, it is interesting.
It is growing on me.
It is more open.
I like that.
I remember the design proposals of the time.
It is interesting, jerry brown had opposed this bridge over design issues.
Principally his biggest concern was design issues.
Not bicycle lanes or any other things like costs, but in his mind it was design.
It shows this growing and interesting concerned with design these days that was not around 10 or 15 years ago.
It is so critical to building things.
Here to discuss more with us, you guys design buildings, cars, smart phones.
You were involved in the shanghai towers.
When it comes to design problems, are these all different problems?
Or are the principles and approaches the same?
It is a good point.
It is a process.
Most people think of design as shape and style.
We think of it as a process.
It is a way of dealing with complex situations.
An mba has one variable, but design is a team sport.
It is a process that you can apply to anything.
What do you think about the bay bridge?
At think it is amazing.
Whether you think the style is great or not, i think it is fabulous.
The design works with a highly ambiguous situation.
There were nine inches of slop that it could move before it failed, this can move nine feet.
The elements that make it gorgeous are the circuit breakers.
And it is a fascinating use of light, using it to illuminate itself.
I feel like bridge design has generally been in this country spectacular.
There are great bridges throughout the midwest.
Generally speaking, i am interested in the reasons for great designs.
20 years ago, pcs were idiots.
They were this formal color.
What is different?
It all comes down to competition.
Looking at the world today, design is the differentiator.
Motorola, those kinds of companies in the 80's, it was customer service that would differentiate.
It was all about cost.
You can only take those variables so far.
The margins are razor thin when you go out on cost.
Design is limitless.
Being able to differentiate in this market, if you look at the markets today, capital is nearly free.
Marketing your britt -- your business is an expensive.
Global competition is immense.
The product has to stand up for itself.
The bay area is great.
We have that kind of team sport.
In the valley you have lots of companies , like the nest, and interesting example.
Everything from analytics to type functionality.
Form and function all-in-one.
That is right.
It is about making those standout.
It is too expensive, there are too many competitors.
Thank you so much for stopping by and sharing your process with us.
Coming up, the battle of area and tv broadcasters, having reached the supreme court.
That project comes next on bloomberg west.
? welcome back.
Ariel, taking on its top broadcasters over the rights to stream television.
Making its way all the way to his -- to the supreme court, arielle is expected to submit a brief tomorrow -- aero is expected to submit a brief tomorrow.
They have always been pretty unapologetic.
They do not believe that this is a sneaky workaround.
They believe that what they have is a legitimate offering.
It is interesting to put it in context, going back to the reason he started it in context.
My last company had technology over viewership.
We used to collect data.
When you look at the data, it is shocking, but the majority of the people have seven or eight channels.
People are consuming more content online.
They are expressing their interests.
How close is the company today to the one that you posted individually?
Startups are strange behaviors.
It is a pretty common story.
This is the first time i have followed clockwork execution in this way.
We knew what we wanted to do so well.
We moved extremely fast.
What about on the legal side?
You must have anticipated some legal hurdles.
Did you anticipate this kind of legal fight?
The things that i did not anticipate would happen were the direct impact and future of these models.
If i had taken a moment i would have stepped back.
A lot of those things, controversy was anticipated.
Outside of court rooms, broadcasters continue to speak on their options and what they are as opposed to where they can take their channels.
We can move the broadcast network to cable.
To the internet.
What do you say to that?
Cable has had an agenda for long time.
Area -- aereo has nothing to do with it.
Are they capable of disenfranchising that large number of people?
I don't think so.
I think it is a difficult position.
To be clear, if you were not successful at the supreme court level, is there a plan b? no, there is no plan b. we work on merit.
We do not just believe in the merit.
The mission of this company was to try to create a platform.
Wedge the door open.
For those who believe in that despite our best efforts, if it failed it would be a tragedy, but it is what it is.
Have you ever thought about selling the company and saying -- hey, we started growing quickly, let someone else worry about these legal headaches?
I am an open-minded businessman at the end of the day.
What is the best way to get your idea in front of as many people as possible?
I always look at those things through that lens.
So far we have seen us driving the bus and pushing the boundaries.
That context, if it changes in the future?
We will deal with it then.
But this is the best experience and the best way possible.
Tomorrow we will go inside that manufacturing facility in new hampshire to show you how they make the tiny antenna.
Looking forward to that coverage throughout this week.
Time now for the big number that tells it all.
The number is 361 million $466,000. the accumulated episode of ox, put the business has lost since 2005. this is a massive money-losing business.
An interesting one.
They do have one hundred $9 million in cash on hand.
Because they keep raising money from investors.
It is reasonable to look at this business and wonder how they can truly differentiate themselves and ever make a profit.
John, you just spoke to aaron leavy and los angeles.
Like little-known fact about aaron leavy, he worked as an intern at paramount and that miramax.
Maybe that is the differentiator.
He could have a future in hollywood if he was not a technology ceo.
A very interesting guy.
Thank you all for watching.
We will see you next time.
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