Brisbane telco Pipe Network is set to unveil a $200 million underwater cable link to the US island of Guam, capitalizing on the booming internet traffic and also to cut broadband costs for Australians.

The project, named Runway, will pitch the group into direct competition between Telstra and the Southern Cross cable owned by Telecom New Zealand and Optus (SingTel).

The new link will be known as Pipe Pacific Cable 1 (PPC-1) and the group is using the US island as it has multiple connections to Hawaii, the US West Coast and parts of Asia. In March last year, Telstra announced that it would build its own underwater cable to Hawaii at a cost of $300 million.

That contract was won by Alcatel-Lucent, the Paris-based telecommunications network maker.

Until now, The Southern Cross cable had a tight grip on the US-bound internet traffic.

The project is expected to be announced in Melbourne by the Communications Minister Stephen Conroy. The Brisbane telco has been highly critical of the national fiber-to-the-node (FTTN) network which the government is spending about $4.7 million.

Executive director Llyod Ernst declined to comment ahead of the announcement on Monday.

Security researchers from Cambridge University have discovered a way to attack the chip and PIN cards.

Since the introduction of mandatory chip and PIN cards in the UK, there are reports that banks have increasingly turned away fraud victims on the grounds that such chip-embedded smartcards cannot be cloned.

The new cards have been heralded as the future of card security, with Westpac issuing them to customers and more banks are set to roll out the cards once the terminals that are compatible are deployed in Australia.

Cambridge PhD students and security researchers, Steven J Murdoch and Sarr Drimer, have shown that it the new cards can be easily cloned - causing a situation that have ruffled the feathers of banks, which rely on the Banking Code of Practise to deny compenstation.

The ability to reject the claims relies on the idea that cloning is the only manner in which fraud occurs on the smartcard only, in which the UK banks say it’s simply impossible.

“The banks have made grand claims of security [about chip and PIN]. It was said to be a safer way to pay but when you speak to the banks as a victim of fraud, they say there is no way to clone the chip and PIN card,” said Murdoch.

“What I’m going to show is that you don’t need to clone it in order to attack the system.”

By tampering with a chip and PIN terminal, Murdoch used a “relay attack” to capture the authentication information sent from the merchant’s POS terminal to the bank. However, the attack requires the involvement of at least two people for it to work. But, once the information is obtained, the fake transaction must occur within the time that the card is being read by the terminal.

While cloning is impossible, according to the banks, Murdoch shows that the authentication can be spied via the terminals compromised and can be transmitted over Bluetooth, GPRS or GSM networks to another person who completes the transaction.

Murdoch previously alerted the banks to the possible exploit a few years ago, but the idea was dismissed as a joke.

He has also offered four suggestions that this could be stopped: make the terminal tamper-resistant, physically examine the card to check for wires as that can indicate that the card is fraudulent, ensure the numbers embossed on the card’s front are the same on the receipt, or impose timing constraints on the authentication as the attack must occur during the time in which the transaction is happening to work.

The problem could be fixed by what scientists are calling “distance bounding protocol” in which the bank sends out a single bit challenge that only a legitimate card can unlock.

A number of phishing sites may be using domains previously linked to the Storm worm botnet, according to security firm F-Secure. This comes after a phishing site on Tuesday attempted to dupe online users of the Halifax building society. F-Secure found that the IP address of the sites were changing every second or so, a characteristic of a botnet using a technique called “fast-flux”.

On further investigations, domains hosting the pages turned out to be the compromised domains previously associated with the Storm botnet and infected with variants of the Storm trojan.

“Somebody is now using machines infected with and controlled by Storm to run phishing scams,” wrote chief research officer Mikko Hypponen in a blog post. “We haven’t seen this before.”

Trend Micro, another security company, also reported phishing attacks from the related domains. The company also noted that the Royal Bank of Scotland customers had been targeted. On a blog post, it had detected that the hosts “were watching domain activity normally associated with [the] suspected RBN (Russian Business Network)-associated activities.”

The original Storm worm code, named because it coincided with a severe winter storm in Europe, will reach its first anniversary next week - on 19 January.

A report issued by the Office of the Inspector General (OIG) has revealed that there are extreme deficiencies in the FBI’s budget and also the expense on procedures for surveillance. According to the OIG, phone companies have terminated FBI wiretaps and surveillance phone lines because of unpaid phone bills.

The OIG launched an audit of the FBI case fund management after a criminal investigation of an telecommunications specialist over at the FBI pleaded guilty of stealing over $25,000 from the undercover surveillance budget. In the audit, the OIG discovered that there were serious problems in the procedures that the agency uses to handle the expenses for undercover intelligence gathering operations.

However, the full report will not be published as the FBI deemed that some content was too sensitive for public viewing; but a summary of the report was made available by the OIG and has pointed that the FBI’s computer systems were a major contributing factor. As well, there were no mechanisms in place to prevent employees from “double-dipping” and requesting funds from both the FBI headquarters and the local offices.

Field divisions all have different procedures for handling telecommunications expenses, which are primarily used for wiretapping and phone lines used to deliver surveillance information. The OIG audit assessed 990 payments made by five field divisions and found that more than half were not paid on time. The late payments have resulted investigations to be terminated.

“We also found that late payments have resulted in telecommunications carriers actually disconnecting phone lines established to deliver surveillance results to the FBI, resulting in lost evidence including an instance where delivery of intercept information required by a Foreign Intelligence Surveillance Act (FISA) order was halted due to untimely payment,” the summary said.

According to Ars Technica, the FBI is currently using an outdated computer system and has not seen a major overhaul since 1986. This is because many attempts have usually resulted in failures. The last planned upgrade, the $170 million Virtual Cast File system, was so dysfunctional that it had to be scrapped. The latest attempt, called Sentinel, is expected to cost $425 million and is to be operational in 2009.

Revelations of the FBI’s mistakes aren’t that new and not that surprising. The OIG had previously blasted the FBI for losing a large number of laptops and weapons. What is more disturbing is that the willingness of the phone companies that has terminated surveillance lines during investigations because of missed payments.

Nearly after a year when satellite radio giants Sirius and XM announced plans to merge together, the proposal is still under regulatory limbo; frustrating many who had been expecting a verdict from the Department of Justice by the end of 2007. And this has caused shares in both companies to fall more than ten percent on Wednesday, a sign that the merger will not go ahead.

The delay was caused by an internal struggle at the Department of Justice between the attorneys, who want to block the union as it would make the new company be a monopoly on satellite radio, and the political appointees, who want the deal to be approved. Even if the Justice department signs off the $13.6 billion deal, it still needs the approval from the Federal Communications Commission (FCC), as the original licenses granted to both companies in that they remain separate.

As well, the merger has seen a strong opposition from many different areas; including the Consumer Federation of America, The National Association of Broadcasters and Free Press. However, some companies have said their approval, from the African Methodist Episcopal Church to the Women Involved in Farm Economics.

Those who want the merger to be approved says that it will allow listeners access to the range of programming offered by both providers under one subscription. This would also give a boost to both Howard Stern and Oprah Winfrey. Also in the minds of people, there is doubt if the new company would be able to make a profit as both firms have lost money since their launch, even though Sirius recorded a 38% increase in subscribers.

Gizmodo has now apologized over a prank that they did during CES. Their prank revolved around turning off plasma and LCD TVs off with the TV-B-Gone.

I have to admit that the video is funny; but the aftermath won’t be as pretty. CES organizers resisted the move to give bloggers press credentials, but let them in anyway. However, they kept them segregated in a lounge without the amenities and the luxury from the “press lounge”.

This prank could see Gizmodo, and/or its parent company Gawker Media, being banned from covering CES or even sued by the CEA - the organizers - or the companies that they pranked. Nick Denton, the owner of Gawker Media, has said to News.com’s Rafe Needleman that he won’t fire the crew over the prank.

Gizmodo did apologized for their prank, saying: “was too much fun, but watching this video, we realize it probably made some people’s jobs harder, and I don’t agree with that (Especially Motorola). We’re sorry.”

However, Vallywag (another Gawker Media property) has turned it around; saying they did the prank under “press” credentials and not blogger badges; using Needleman’s view of bloggers and the press.

If you were wondering why the “lawsuit” tag appears - I just want to be prepared if anyone sues them.

New York has launched a formal investigation on Thursday to see if Intel, the world’s biggest chipmaker, violates state and US antitrust laws to ’squeeze’ out rival Applied Micro Devices (AMD).

New York Attorney General Andrew Cuomo has said that his office had issued a wide-ranging subpoena seeking documents and information about a previous probe raised questions about whether Intel intimidated customers to exclude AMD from the worldwide market for microprocessors.

Intel is also facing similar investigations in Europe and Asia, with US federal investigators have declined to take up the matter.

An Intel spokesperson said that the biggest chipmaker had been a long target of government regulators for alleged anticompetitive practices. The company has either settled them with regulators and rivals.

AMD has also said that it had been contacted by Cuomo’s office. “I can confirm that we have received a subpoena, too,” said an AMD spokesperson and declined to give any further details.

On Monday, An Intel spokeswoman said the company had responded to antitrust charges filed by the European Commission and has seek a hearing. The commission has charged Intel last July for slashing prices below cost and offering rebates in an illegal attempt to drive AMD’s market share down.

The commission charges and the response are confidential.

Sony BMG has now announced that it will sell non-DRM tracks via the Amazon Music Store, a few days after it announced the “Platinum MusicPass”, which are cards that you would buy and go to the website and redeem the songs via a code.

This new deal seas Amazon becoming the first music distributor that will sell DRM-free music from the Big Four music labels. This also sees Steve Jobs’ actions to let iTunes to be the first to offer music DRM-free failing, with the labels playing hardball with Apple. NBC has left iTunes, and this could also see the labels pulling out now.

DRM-free music on iTunes is only limited to independent labels and EMI.

I could see how this new deal could work out for Sony BMG. If you have an Amazon account, you can buy your music at Amazon. If you don’t, you can always go to the stores and buy it as well. Either way, you would still have DRM-free music on your account.

Currently, Sony BMG has uploaded around 200,000 tracks to Amazon, which actually mean that their entire “active” catalogue - the stuff that actually sells - is up.

TechCrunch is also expecting that Sony BMG music, which has Australian artists and bands such as Delta Goodrem, Silverchair, Damien Leith and Young Divas, being sold on the iTunes store as well; joining EMI.

Sony has said on Thursday that it would stop shipments the Playstation 3 models with 20GB and 60GB hard disk drives in Japan this month as it is focusing its attention on the 40GB model.

Sony said that this does not mean that the 40GB version would be the only model in Japan, and that it will launch newer models in response to user preferences in the future.

The 40GB model, launched in November in Japan, sells for 39,980 yen (US$365.50), less than the 20GB model which sells for 44,980 yen.

Prior to the announcement, shares in Sony closed down 1 percent at 6,130 yen. The IELEC, Tokyo stock market’s electircal machinery index, fell 1.4 percent.

According to ELSPA (Entertainment and Leisure Software Publishers Association) and Chart-Track, which officially released the annual video game data for the U.K. today, the industry across the pond hit an all-time high in 2007.

ELSPA said it was an “unprecedented” year as there was a 16 percent increase in units sold for a total of 75.9 million units, and record sales of interactive entertainment software across all formats totaled £1.72 billion ($3.37 billion), representing an increase of more than 26 percent over the record numbers of 2006.

The portable market played a big part in the growth of the U.K. industry, as 2007 was the biggest year ever for handheld systems. The Nintendo DS in particular was number one in terms of software units sold, while Sony’s PSP ranked fifth and sixth in units and value, respectively. “The entire console hand-held sector broke previous records and claimed nearly a third of the entire software units market, up 45% and just over one-quarter of the entire software market by value, up by 28%,” ELSPA noted.

In terms of value, the Xbox 360 was tops, followed by PS2 (down from top spot in 2006), then Nintendo’s Wii and Sony’s PS3. Looking at the systems in terms of units sold, however, the order changes to PS2 (but #2 overall behind DS, the first time it has not been the biggest format since 2003), followed by Xbox 360, Wii and PS3.

The top 10 games in the U.K. were as follows:

1. FIFA 08 (EA Sports)
2. Dr Kawashima’s Brain Training (Nintendo)
3. Call of Duty 4: Modern Warfare (Activision)
4. Pro Evolution Soccer 2008 (Konami)
5. More Brain Training from Dr Kawashima (Nintendo)
6. Halo 3 (Microsoft)
7. The Simpsons Game (EA Games)
8. Wii Play (Nintendo)
9. Assassin’s Creed (Ubisoft)
10. WWE Smackdown vs Raw 2008 (THQ)

Paul Jackson, Director General of ELSPA, commented, “We are thrilled to see the industry growing and software sales continuing to rise. This is a real testament to the industry, the creativity and the talent we have in the U.K. There is, however, a chance to forget many of the problems the U.K. development sector faces with the pressure from the threat of international competition. We need to ensure that the U.K. creativity is able to continue to flourish and feed this demand, these figures should act as a reminder to us of the scale of our amazing industry and how we need to continue to work towards a healthier situation for one of the U.K. most lucrative creative industries.”

Written by James Brightman from GameDaily
© 2008 GameDaily