22 July 1998: Link to Netscape presentation cited in text

21 July 1998
Source: http://www.nwfusion.com/news/0720nsa.html (requires sign-up)
Thanks to MO

The long, strong arm of the NSA

By Ellen Messmer
Network World, 7/20/98

Fort Meade, Md. - Back in the days of the cold war, Washington insiders used to joke that NSA stood for "No Such Agency." The government denied the very existence of this group, which is dedicated to intercepting and decoding foreign communications.

That was then. Today the National Security Agency is well known, and spends a lot of time leaning on software, switch and router vendors, pushing them to re-tool their products. The agency's goal: to ensure that the government has access to encrypted data.

The industry is facing a year-end deadline to add a government-approved back door into network gear. Vendors that don't provide this access risk losing export privileges.

Cruising up and down Silicon Valley, NSA spooks from the agency's Fort Meade headquarters have been making pit stops at companies ranging from industry leaders Netscape Communications Corp. and Sun Microsystems, Inc. to start-ups such as VPNet Technologies, Inc. in order to get a peek at products still on the drawing board.

The NSA wants software vendors to make sure that any product with strong encryption have some way for the government to tap into the data. And because practically every commercial network application, router or switch these days includes encryption or an option for it, almost every vendor now has to answer to the NSA if it wants to export.

Hot line to the NSA

It's gotten to the point where no vendor hip to the NSA's power will even start building products without checking in with Fort Meade first. This includes even that supposed ruler of the software universe, Microsoft Corp. "It's inevitable that you design products with specific [encryption] algorithms and key lengths in mind," said Ira Rubenstein, Microsoft attorney and a top lieutenant to Bill Gates. By his own account, Rubenstein acts as a "filter" between the NSA and Microsoft's design teams in Redmond, Wash. "Any time that you're developing a new product, you will be working closely with the NSA," he noted.

When it comes to encryption, it's widely known that a 40-bit encryption key is easily breakable and hence rather useless. Until not long ago, this is what the U.S. government allowed for the export of software.

But the Clinton administration a year and a half ago said it would allow the export of products with stronger encryption keys by any vendor that agreed to add a "key-recovery" feature to its products by year-end - giving the government access to encrypted data without the end user's knowledge.

According to Bill Reinsche, Department of Commerce undersecretary for the Bureau of Export Controls [sic], about 50 vendors have submitted plans for government-approved key-recovery, also called data-recovery. These companies, which include IBM, were rewarded with Key Management Infrastructure (KMI) export licenses to export products with 56-bit or stronger encryption until year-end.

But some companies are discovering that dealing with the Commerce Department for a KMI license means more involvement with the NSA.

The Bureau of Export Control [sic] is actually just a front for the NSA, said Alison Giacomelli, director of export compliance at VPNet Technologies, Inc., a San Jose, Calif.-based vendor of IP-based encryption gateways. "The NSA has sign-off authority on these KMI licenses," Giacomelli said. In return for the KMI license, VPNet opened itself up for an NSA audit.

"They've already come out once, and they'll be coming out again," Giacomelli said. VPNet remains committed to meeting the deadline for adding key-recovery to its product but has one major problem: uncertainty about what the NSA really wants. The confusion means "there's a lot of risk . . . in terms of engineering and resources," Giacomelli said.

Clearly wary of granting the government supervision over its products, Microsoft has stubbornly refused to submit a data-recovery plan, even though the Redmond giant already includes a data-recovery feature in its Exchange Server.

"The Exchange Server can only be used when this feature is present," Rubenstein said. "Because we haven't filed a product plan, it's harder for us to export this than for companies that have filed plans."

But in an odd-couple sort of joint-partner arrangement, Microsoft and the NSA did work together to build what's called Server Gated Cryptography. Primarily intended to help banks use Web servers to do business internationally, the technology lets a server with a special digital certificate provide 128-bit encryption support to a Web browser outside the U.S.

Sybase, Inc., which also submitted a plan to add key-recovery to its products, found it hard to satisfy the government's demands. "They approved our technological approach but disapproved each of our applications with it," said Sybase President and CEO Mitchell Kertzman. "It's been frustrating."

Documents recently obtained under the Freedom of Information Act (FOIA) by the Washington, D.C.-based Electronic Privacy Information Center contain the data-recovery plan Netscape filed at the Commerce Department last year.

Netscape's plan explains that the "escrow of private encryption keys" could be achieved by developing client and server products that can only issue an X.509 digital certificate after the private key has been escrowed. The key can only be held by an entity chosen by the intranet administrator who handles security policy.

The Netscape plan called for introducing a certificate server with recovery capabilities in the first quarter of this year, with the introduction of S/MIME clients with basic recovery features in the second quarter.

Netscape hasn't actually carried out this plan, and the company declined to discuss it. Netscape attorney Peter Harter would only say officially, "We had no choice but to submit the plan, no matter how much we opposed key-escrow, in order to be part of the ongoing dialog."

Other FOIA documents show that Netscape was regularly briefing the NSA on its product plans since 1996 and that then NSA Deputy Director William Crowell took a special interest in trying to dissuade Netscape from using strong encryption.

Crowell, now vice president for product marketing and strategy at Cylink Corp., said he had frequent discussions with Netscape, especially concerning changes to Netscape Navigator. "Their product didn't have a separate signature key, so if the government used the product for key-escrow later, you'd have to store the signature key with a third party, which we thought was a bad idea," Crowell said. He added that Netscape Navigator 3.0 adopted the changes the NSA wanted.

According to Crowell, the NSA has a great deal of expertise in securing communications, and it wants to ensure that products bought by the Defense Department meet NSA standards. "In addition, as part of the NSA's intelligence mission, [the agency needs] to have a thorough understanding of where commercial products are headed."

Taher Elgamal, author of the Netscape data-recovery plan, who recently left Netscape to start his own venture, said Netscape had no choice but to maintain constant contact with the NSA. "They're costing the industry a lot of money," Elgamal said.

Others agree. "Everyone in Silicon Valley, including us, has to have specific staff - highly paid experts - to deal with them," said Chris Tolles, security group product manager at Sun. "Their job is to wrangle this from a policy standpoint."

Sun has had run-ins with the NSA in the past. Two years ago, the NSA objected to Sun including encryption in the exportable version of Java 1.1. The end result was that Sun stripped encryption out of Java 1.1 and the software was delayed by about six months.

Source: http://www.nwfusion.com/news/0720nsa1.html

Charge it to the NSA

By Ellen Messmer
Network World, 7/20/98

The National Security Agency (NSA), with an estimated 40,000 employees, works hard to make U.S. military encryption devices rock solid, the agency is inclined to weaken commercial encryption when it can because strong encryption impedes the agency's mission of data collection.

In one instance, the spy agency forced MasterCard International, Inc. to dumb down the Secure Electronic Transaction (SET) credit-card encryption standard.

When MasterCard first thought of creating SET for credit-card encryption, "we ran over to the government to tell them what we wanted to do," said John Wankmuller, MasterCard's principal in charge of electronic commerce. However, the NSA quickly threw a damper on the company's enthusiasm. "They told us what we wouldn't do," Wankmuller said.

The NSA nixed the idea that SET should be able to encrypt the customer's entire purchase information, limiting the encrypted fields to the account number, amount and the expiring date, Wankmuller said. "In the end, it's a very small amount of data that gets encrypted."

But in other areas, the NSA has also had less confrontational contact with industry, too.

The agency played the lead role at the IETF in developing two protocols, one called IP Security and the other called Internet Key Exchange, which is gaining wide acceptance in products and among users in the automotive industry.

Source: http://www.nwfusion.com/news/0720nsa3.html

User manual: Dodging the rules

By Ellen Messmer
Network World,

The National Security Agency (NSA) wrote the export rules on encryption. But from the point of view of corporations that want to ship U.S. software to their foreign offices, getting around the U.S. export rules is a top priority.

And even for those who used to work at the NSA, it's still a challenge.

"Well, I wrote those export rules when I was at the NSA," confessed Russell Davis, now chief of information technology security at SBC Warburg Dillon Read, a division of Swiss Bank Corp., which operates in 77 countries. Since joining the corporate life, Davis has used his knowledge of the NSA to find ways to work around the export system on behalf of his customer, the bank, which uses a lot of encryption-based security gear.

"It took 17 months to figure out how to get crypto-based smart cards to Swiss facilities and elsewhere," Davis said. "But I wrote the rules on all this, and I know how to get around them." Would he ever consider using government-approved data-recovery?

"Never," Davis declared. "My customers come first!"

"Our customers just aren't going to buy these types of products," said Tom Carty, vice president of business development for GTE CyberTrust. He agreed the government is leading industry down a path to build products few users will willingly buy.

Another sidebar reports on Cisco's "Private Doorbell" proposal: