Spying on a grand scale - Media
Review by Daniel Herborn - MURDOCH'S PIRATES
Neil Chenoweth - Allen & Unwin, 432pp
When Neil Chenoweth, a journalist for the Australian Financial Review and author of a biography of Rupert Murdoch, stumbled across the details of possible corporate espionage carried out by a little-known organisation called News Datacom (NDS), his first response was one of disbelief.
An Israeli start-up company founded by scientists and cryptographers, NDS had been acquired by News Corporation, its biggest customer, and existed in relative obscurity until a series of billion-dollar lawsuits, with satellite service provider EchoStar suing it for piracy and French pay TV channel Canal Plus taking legal action, which they later abandoned, alleging NDS leaked valuable code on the internet.
To come to terms with why hacking may become a hugely valuable tactic and disruptive force for content providers, it's important to understand that the revenue-raising potential of pay television rests largely on the security of pay walls. If people can easily access the content without paying the subscription fee then the value of the product plummets.
This makes enabling pay-TV smartcards with security measures a hugely lucrative business. But how does a firm producing these cards show the superiority of its cards over others? One way is by demonstrating that competitors' cards can be hacked. If you can hack into your competitors' systems, potentially you can trash the commercial value of their product.
In a series of articles for the AFR, Chenoweth drew on a massive cache of emails to allege NDS hacked its rivals for commercial gain as News Corporation was moving into the Australian pay TV market. Given the sheer commercial scale involved, Chenoweth has called the alleged hacking "arguably the biggest industrial espionage case in history".
Billed as a story "about what happens when an international corporation hires its own spy force", the focus is often narrower than that, with the narrative taking in a wealth of technical detail and the minutiae of the politics and rivalries between hackers, and the hacks and counter-hacks between covert groups.
Chenoweth has secured remarkable levels of access to the hackers, and the overriding impression is of technically gifted savants in way over their heads. Even after the controversies and the mysterious death of talented hacker Boris Floricic, ruled a suicide, they often come across as naive.
Inevitably, though, the key figure in this story is Murdoch, detached as he is from much of the action. Constants in the story are his seemingly inexhaustible reserves of energy and bullishness, his cunning and unexpected capacity for charm. Although a Luddite at heart, he couldn't resist the riches on offer in this high-tech field.
While his motivations for dabbling in data encryption in the first place remain clouded, his end game of accumulating wealth, media influence and power, or some amalgam of all three, is clear.
Murdoch's Pirates is a staggering feat of research, but at times suffers from a lack of accessibility.
It is to be hoped this factual account lays the path for further work that looks beyond the crosses, double crosses, aliases and the farcical confusion to the complex questions of how law enforcement agencies should deal with this new and high-stakes world of corporate spying.
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Murdoch's Pirates
Spying on a grand scale - Media
Review by Daniel Herborn - MURDOCH'S PIRATES
Neil Chenoweth - Allen & Unwin, 432pp
When Neil Chenoweth, a journalist for the Australian Financial Review and author of a biography of Rupert Murdoch, stumbled across the details of possible corporate espionage carried out by a little-known organisation called News Datacom (NDS), his first response was one of disbelief.
An Israeli start-up company founded by scientists and cryptographers, NDS had been acquired by News Corporation, its biggest customer, and existed in relative obscurity until a series of billion-dollar lawsuits, with satellite service provider EchoStar suing it for piracy and French pay TV channel Canal Plus taking legal action, which they later abandoned, alleging NDS leaked valuable code on the internet.
To come to terms with why hacking may become a hugely valuable tactic and disruptive force for content providers, it's important to understand that the revenue-raising potential of pay television rests largely on the security of pay walls. If people can easily access the content without paying the subscription fee then the value of the product plummets.
This makes enabling pay-TV smartcards with security measures a hugely lucrative business. But how does a firm producing these cards show the superiority of its cards over others? One way is by demonstrating that competitors' cards can be hacked. If you can hack into your competitors' systems, potentially you can trash the commercial value of their product.
In a series of articles for the AFR, Chenoweth drew on a massive cache of emails to allege NDS hacked its rivals for commercial gain as News Corporation was moving into the Australian pay TV market. Given the sheer commercial scale involved, Chenoweth has called the alleged hacking "arguably the biggest industrial espionage case in history".
Billed as a story "about what happens when an international corporation hires its own spy force", the focus is often narrower than that, with the narrative taking in a wealth of technical detail and the minutiae of the politics and rivalries between hackers, and the hacks and counter-hacks between covert groups.
Chenoweth has secured remarkable levels of access to the hackers, and the overriding impression is of technically gifted savants in way over their heads. Even after the controversies and the mysterious death of talented hacker Boris Floricic, ruled a suicide, they often come across as naive.
Inevitably, though, the key figure in this story is Murdoch, detached as he is from much of the action. Constants in the story are his seemingly inexhaustible reserves of energy and bullishness, his cunning and unexpected capacity for charm. Although a Luddite at heart, he couldn't resist the riches on offer in this high-tech field.
While his motivations for dabbling in data encryption in the first place remain clouded, his end game of accumulating wealth, media influence and power, or some amalgam of all three, is clear.
Murdoch's Pirates is a staggering feat of research, but at times suffers from a lack of accessibility.
It is to be hoped this factual account lays the path for further work that looks beyond the crosses, double crosses, aliases and the farcical confusion to the complex questions of how law enforcement agencies should deal with this new and high-stakes world of corporate spying.