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Connections - Internet governance

China’s quantum link from Beijing to Shanghai is near completion

Researchers from the University of Science and Technology in China are about to finish a 2,000 kilometer fiber optic link which will be used to connect quantum networks in four cities in the country. The link will start from Beijing and end in Shanghai and will be intended for secure communications that cannot be hacked theoretically. The process to be accomplished is called quantum key distribution (QKD), which creates shared cryptographic keys, sequences of random bits, that can be used to encrypt and decrypt data. A quantum science satellite has already been launched in August that will test the distribution of keys beyond China's borders. QKD technology has already been used in 2007 to secure the sending of votes from an election in Sweden. It was also accomplished by a firm in the US called Battelle to transmit information securely from a company's headquarters to its production facility.

Key Takeaway: 

China’s quantum link, a 2-kilometer fiber optic link which will serve as the backbone for secure quantum communications and will run from Beijing to Shanghai, is near completion.

Publication: 
Publication Date: 
October 26, 2016

Intel’s venture capital firm to invest $38 million in startups

Intel Capital is investing $38 million in a dozen startups focused on autonomous machines, data and connectivity, sports and health, and virtual reality. One of the robotics firms, Chronocam, is creating computer vision sensors and systems that are like the biological human eye. Embodied is making socially assistive robots while Perrone Robotics is developing a software platform for autonomous vehicles and robots. Among the four startups focused on data and connectivity, two are China-based: Eazytec which provides IoT technologies for monitoring the water and air in China and Grand Chip Microelectronics which offers connectivity solutions for WLAN, Wi-Fi, cellular and IoT. The two others are Paxata, which is working on a business information platform that turns raw data into meaningful information for enterprise and IT users and StealthMine, which is securing data encryption for enterprise applications. Sports and health firms Cubeworks, Kinduct and L4Connect are developing tiny millimeter-sized wireless sensors, a data and analytics platform, and dashboards respectively. Virtual reality startup Dysonics is working on solutions that will enable people to capture 360-degree sounds for live VR experiences. Lastly, InContext Solutions is helping manufacturers and retailers simulate their products and services in virtual reality.

Key Takeaway: 

Intel Capital, Intel’s venture capital firm, is investing $38 million in 12 startups focused on robotics, IoT connectivity and data analytics, sports, health and wellness, as well as virtual reality, with technologies that are ground-breaking and could be useful for various customer markets such as the enterprise, health and wellness organizations.

Publication: 
Publication Date: 
October 24, 2016

EU to impose higher fines for data breaches

The European Union recently set tougher data protection laws called the General Data Protection Regulation (GDPR) which will introduce higher fines to companies for data breaches, from hundreds of thousands of euros to millions. The regulation is already in effect but mandatory enforcement will start in 2018. Fines can amount up to €20 million or 4% of annual worldwide turnover, whichever is greater, for major breaches and up to €10 million or 2% of global annual turnover, whichever is bigger, for less serious incidents. UK companies could collectively pay as much as £122 billion overall in 2018, a 90-fold rise from the £1.4 billion estimated regulatory fines for data breaches in 2015. The PCI Security Standards Council is urging companies to put in place standards and procedures to detect, prevent and counter cyberattacks in view of the rising costs of regulatory fines. In 2015, 90% of large organizations and 74% of SMEs in the UK reported a security breach.

Key Takeaway: 

Companies doing business in the European Union may face larger fines of millions of euros if found to be subject of data breach when the new and stricter data protection regulation takes into full effect by 2018.

Market Disruptions: 
Publication: 
Publication Date: 
October 17, 2016

UK opens National Cybersecurity Centre in London

The UK has created a new National Cyber Security Centre (NCSC) in London whose goal is to build and operate a defense network to respond to increasing incidents of cybercrime. It will be tasked to respond to cyber threats, work with public and private sector organizations on cybersecurity matters, research on the cybersecurity environment, and build expertise on cybersecurity technologies and identifying threats. The NCSC will be under the Government Communications Headquarters (GCHQ), the country's national surveillance body. Public communications relevant to protecting citizens from cybercrime will be handled by the NCSC. According to Europol, cybercrime is surpassing traditional crime incidents in Europe. In fact, all types of cybercrime are on an upward trend for some time. There is also an expanding cyber criminal economy that use digital currencies to buy criminal products and services, reports Europol.

Key Takeaway: 

The UK recently launched its own National Cyber Security Centre that focuses on defending the country from cybersecurity threats, collaborating with private and public sector organizations on cybersecurity issues, understanding the cybersecurity environment, and building capability to identify threats and other technology trends which are all vital in an increasingly digital environment with a progressing trend of cybercrime.

Publication: 
Publication Date: 
October 3, 2016

Yahoo hack brings to light insufficiency of SEC cyber disclosure rules

Yahoo recently announced that at least 500 million accounts were breached by hackers in 2014 blaming it on a state-sponsored actor. The company did not provide details on when the hack was discovered nor did it mention it during the sale of its core Internet business to Verizon. This announcement brings to light that existing SEC rules remain unclear as to what hacking incidents considered to have "materially adverse effects on businesses" need disclosure and the need to enforce them more aggressively to make companies comply. It also calls into question whether the current set of SEC rules is adequate to address disclosure of hacking incidents. According to a Reuters report, less than 100 of 9,000 public companies have disclosed a material data breach since 2010. There is currently no national requirement for companies to inform the public of data breaches.

Key Takeaway: 

The recent announcement of the hack on Yahoo in 2014 involving stolen data from more than 500 million accounts challenges SEC's existing set of rules on cyberattack disclosure, and highlights the need for it to be defined more clearly and enforced aggressively.

Market Disruptions: 
Transforming Business Models: 
Publication: 
Publication Date: 
September 30, 2016

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