March 7, 2021

Bloomberg's 'big hack' sequel only raises more questions

[] Bloomberg's 'big hack' sequel leaves questions unanswered | Fortune© 2020 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our u003ca href="https://fortune.com/terms-of-use/">Terms of Useu003c/a> and u003ca href="https://fortune.com/privacy-policy/">Privacy Policyu003c/a> | u003ca href="/california-privacy-policy/#notice">CA Notice at Collection and Privacy Noticeu003c/a> | u003ca href="https://fortune.com/right-to-opt-out/">Do Not Sell My Personal Informationu003c/a> | u003ca href="http://preferences-mgr.trustarc.com/?pid=fortunemedia01&aid=fortunemedia01_pub&type=fortunemedia">Ad Choices u003c/a>u003cbr />nFORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.u003cbr />nQuotes delayed at least 15 minutes. 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China's exploitation of products made by Supermicro, as the U.S. company is known, has been under federal scrutiny for much of the past decade, according to 14 former law enforcement and intelligence officials familiar with the matter, Bloomberg reports.","crops":[],"height":2668,"imageSize":"article-featured-image","lazyload":true,"lqipSrc":"https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg?quality=60&resize=60,40","postId":2954058,"retina":true,"showCaption":true,"sources":[{"transforms":{"resize":[750,500]},"descriptor":750,"media":{"min":"lg"}},{"transforms":{"resize":[500,333.34]},"descriptor":500,"media":{"min":"md"}},{"transforms":{"resize":[375,250]},"descriptor":375,"media":{"max":"md"}}],"sourceTags":[],"src":"https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg","srcset":"https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg?resize=1500,1000 1500w,https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg?resize=750,500 750w,https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg?resize=1000,666 1000w,https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg?resize=500,333 500w,https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg?resize=750,500 750w,https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg?resize=375,250 375w","url":"https://content.fortune.com/wp-content/uploads/2021/02/GettyImages-1231124954.jpg","useBasicImg":false,"usingDataFallback":false,"width":4000,"credit":"David Paul Morris—Bloomberg/Getty Images","fallbackImageUrl":"data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7","picture":false,"sizes":"(min-width: 64rem) 750px,(min-width: 48rem) 500px,(max-width: 48rem) 375px,100vw"},"children":[]}]},{"name":"article-body","config":{"mediaType":"image","premiumCategory":"P-Newsletter"},"children":[{"name":"gutenberg-content","config":{},"children":[{"name":"html","config":{"content":" u003cp>Cyberia is a treacherous land—a cold, perilous, and unforgiving terrain for journalists to navigate. There are few signposts, compass readings are suspect, and will-o-the-wisps love to lead wanderers astray. I am referring, of course, to the cybersecurity beat.u003c/p> u003cp>On Friday, u003cem>Bloombergu003c/em> u003ca href="https://www.bloomberg.com/features/2021-supermicro/?sref=b0SdE1lu">published a sequelu003c/a> to “u003ca href="https://www.bloomberg.com/news/features/2018-10-04/the-big-hack-how-china-used-a-tiny-chip-to-infiltrate-america-s-top-companies">The Big Hacku003c/a>,” its u003ca href="https://fortune.com/2018/10/14/cyber-saturday-doubts-swirl-around-bloombergs-china-chip-hack-report/">contentious and widely disputed 2018 investigationu003c/a> into an alleged hardware supply chain hack. The supposed espionage case centered on Supermicro, a San Jose, Calif.-based firm that makes computer server parts. In the earlier story, u003cem>Bloombergu003c/em> reported that Chinese agents infiltrated U.S. companies—including u003ca href="https://fortune.com/company/apple/" target="_blank">Appleu003c/a> and Amazon—using grain-sized spy chips surreptitiously fitted onto Supermicro hardware.u003c/p>u003cp>u003c!-- piano selector -->u003c/p>u003cdiv class="paywall"> u003cp>The first article drew immediate backlash. Cybersecurity experts disputed the technical details. A named source u003ca href="https://9to5mac.com/2018/10/09/bloomberg/">disavowed the storyu003c/a>. And just about all the companies and authorities involved—including Supermicro, Apple, Amazon, and even the United States National Security Agency—u003ca href="https://9to5mac.com/2018/10/11/spy-chip-claims/">issued unambiguous denials and rejectionsu003c/a>.u003c/p> u003cp>None of that stopped u003cem>Bloombergu003c/em> from doubling down. In the new story, published Friday, u003cem>Bloombergu003c/em> addresses some of the pushback. Then it claims—through a combination of squishy sourcing and a cataloguing of ancillary cybersecurity incidents—that the original report “only captured part of a larger chain of events.” Rather than clearing up the matter, the follow-up report raises more questions.u003c/p> u003cp>Supermicro, for one, has u003ca href="https://www.supermicro.com/en/pressreleases/supermicro-statement-bloombergs-claims">strenuously objected, againu003c/a>, calling the new piece “a mishmash of disparate and inaccurate allegations that date back many years.” u003cem>Bloombergu003c/em> didn’t attempt to further its earlier assertions about compromises at Apple and Amazon, whose names appear in the latest report only to note they called for retractions. Joseph Menn, a veteran cybersecurity reporter at u003cem>Reutersu003c/em>, u003ca href="https://twitter.com/josephmenn/status/1361084452865155075?s=20">jokedu003c/a> about the new story, “This is the weirdest retraction I have ever read.”u003c/p> u003cp>The best skeptical dissection of u003cem>Bloomberg’su003c/em> latest reporting comes from Matt Tait, a senior cybersecurity fellow at the University of Texas at Austin’s Center for International Security and Law, who goes by the moniker PwnAllTheThings on u003ca href="https://fortune.com/company/twitter/" target="_blank">Twitteru003c/a>. “This story is too big, and the refutations too blunt and too numerous to support on this level of third- and fourth-hand sourcing,” he said of the new story. “If they have documents: go for it. Make fools of Apple, Amazon, FBI, NSA, DHS and ODNI by publishing them. Otherwise, this story should not have run.” (I recommend reading u003ca href="https://twitter.com/pwnallthethings/status/1360231268013793289?s=20">Tait’s point-by-point objections in fullu003c/a>.)u003c/p> u003cp>On the one hand, I commend the u003cem>Bloombergu003c/em> team for attempting to get its initially clumsy investigation on surer footing. The new story reveals more details about the U.S.'s alleged national security suspicions over and secret counterintelligence investigations into Supermicro. The outcome of those mysterious investigations, and whether they remain ongoing, is unclear, as the authors note. (u003cem>Bloombergu003c/em> hasn't issued an additional statements about its latest story, and it never retracted its earlier story.)u003c/p> u003cp>But the new reporting hardly settles the matter. When u003cem>Bloomberg’su003c/em> earlier story published, I advised readers to file the reporting “u003ca href="https://fortune.com/2018/10/14/cyber-saturday-doubts-swirl-around-bloombergs-china-chip-hack-report/">under cloak, not daggeru003c/a>.” I stand by that assessment. The earlier piece had obvious holes; tellingly, u003cem>Bloomberg’su003c/em> sequel does not link to its first article. And the new piece relies heavily on anonymous or secondhand sourcing, which does not inspire confidence.u003c/p> u003cp>Some sort of espionage incident—or incidents—may have occurred, but what exactly? How serious were they? And why have no alleged spy chips turned up in the public domain in the past two years?u003c/p> u003cp>Without more documentation, our guides leave us stranded in Cyberia.u003c/p> u003cp>u003cstrong>Robert Hackettu003c/strong>u003c/p> u003cp>Twitter: u003ca href="https://twitter.com/rhhackett">@rhhackettu003c/a>u003c/p> u003cp>u003ca href="mailto:robert.hackett@fortune.com">robert.hackett@fortune.comu003c/a>u003c/p> u003ch3>NEWSWORTHYu003c/h3>nu003cp>u003cstrong>Lowly Worm on the streets of Busytownu003c/strong>. The rumor mill continues to churn over u003cstrong>Apple’su003c/strong> interest in finding a manufacturing partner for its rumored u003cstrong>Apple Caru003c/strong>, also called u003cstrong>Project Titanu003c/strong>. Talks between the u003cstrong>iPhoneu003c/strong>-maker and u003cstrong>Japan’s Nissanu003c/strong> automaker fell through when the two companies failed to reach an agreement over branding, the u003cem>Financial Timesu003c/em> u003ca href="https://www.ft.com/content/29d4aa6b-fba5-4a53-876e-3f097fdef1d2">reportsu003c/a>. Car manufacturers are apparently worried about becoming “the Foxconn of the auto industry,” and Apple’s talks with u003cstrong>South Korea’s Hyundai u003c/strong>also recently broke down. (Subject line a nod to u003ca href="https://www.amazon.com/Richard-Scarrys-Lowly-Worms-Applecar/dp/0764166735">Richard Scarryu003c/a>.)u003c/p>nu003cp>u003cb>‘Fore the day I die, I’ma touch the sky. u003c/b>The price of u003cstrong>Bitcoinu003c/strong> u003ca href="https://www.wsj.com/articles/bitcoin-trades-above-50-000-for-first-time-11613479752">breached $50,000u003c/a> for the first time ever Tuesday morning, setting a u003ca href="https://fortune.com/2021/02/16/bitcoin-crypto-all-time-record-rally/">new record highu003c/a>. The cryptocurrency’s total market value in circulation is more than $900 billion—nearing $1 trillion—having more than doubled in two months. Companies ranging from u003cstrong>BNY Mellonu003c/strong> to u003cstrong>Mastercardu003c/strong> to u003cstrong>Teslau003c/strong> to u003cstrong>PayPalu003c/strong>, plus various hedge fund managers, have all u003ca href="https://fortune.com/2021/02/11/bitcoin-price-mastercard-bny-mellon-crypto/">warmed upu003c/a> u003ca href="https://fortune.com/2021/02/15/bitcoin-record-wall-street-crypto/">to cryptocurrencyu003c/a> recently, helping fuel the rally. u003c/p>nu003cp>u003cstrong>Voulez-vous Parler avec moi?u003c/strong> The social media app u003cstrong>Parleru003c/strong> u003ca href="https://www.theverge.com/2021/2/15/22284036/parler-social-network-relaunch-new-hosting?scrolla=5eb6d68b7fedc32c19ef33b4">is backu003c/a> after u003cstrong>Amazonu003c/strong> u003ca href="https://fortune.com/2021/01/13/amazon-parler-ban-user-threats-to-staff/">knocked it offu003c/a> its web infrastructure a month ago. The loosely moderated app, popular among some conservatives, u003ca href="https://fortune.com/2021/01/19/epik-parler-web-domain-dns-provider-gab-conservatives-social-media/">found a new home with Epiku003c/a>, a web hosting business known for catering to far-right sites. After firing its former CEO John Matze, Parler u003ca href="https://www.nytimes.com/2021/02/15/technology/parler-back-online.html">appointed an interim CEOu003c/a>, Mark Meckler, cofounder of the right-wing group Tea Party Patriots, while it hunts for a more permanent boss. u003c/p>nu003cp>u003cstrong>Hobbits will shape the fortunes of all.u003c/strong> Shares of u003cstrong>Palantiru003c/strong>, the Colo.-based data analytics firm, u003ca href="https://www.cnbc.com/2021/02/16/palantir-pltr-q4-2020-earnings.html">fell 9% Tuesday morningu003c/a> after the company reported a loss of 8 cents per share in its u003ca href="https://investors.palantir.com/news-details/2021/Palantir-Reports-Revenue-Growth-of-47-for-Full-Year-2020-Expects-Q1-2021-Revenue-Growth-of-45/default.aspx">fourth quarter ended Dec. 31u003c/a> with a forecast of u003ca href="https://www.bloomberg.com/news/articles/2021-02-16/palantir-s-2020-operating-profit-fails-to-ease-stock-lockup-fear">decelerated sales growthu003c/a> for the year ahead. Despite the dip, Palantir said it brought in $322 million in revenue in the most recent quarter, more than the $300.7 million analysts expected. u003cstrong>Alex Karpu003c/strong>, Palantir’s cerebral, Silicon Valley-spurning chief exec, told investors he hopes “those of you who prefer a more short-term focus, that you choose companies that are more appropriate for you.”u003c/p>nu003cp>u003cstrong>Jagged little pill.u003c/strong> South Korean intelligence officials said u003cstrong>North Korean hackersu003c/strong> tried to steal u003cstrong>COVID-19 vaccineu003c/strong> technology from U.S. pharma company u003cstrong>Pfizeru003c/strong>, according to a u003ca href="https://en.yna.co.kr/view/AEN20210216008451315">local outlet u003cem>Yonhapu003c/em>u003c/a>. Details are scarce and Pfizer has yet to issue a statement.u003c/p>nu003cp>u003cstrong>Dragon’s on the desert floor.u003c/strong> French security officials u003ca href="https://www.reuters.com/article/us-global-cyber-centreon-idUSKBN2AF1RA">linked a recently uncovered, widespread hacking campaignu003c/a> to u003cstrong>Sandwormu003c/strong>, a hacker group associated with u003cstrong>Russia’s GRUu003c/strong> military intelligence agency. Dating to late 2017, u003ca href="https://www.wired.com/story/sandworm-centreon-russia-hack/">the cyber-spreeu003c/a> mainly hit IT and web hosting firms, officials said, and it compromised an IT monitoring tool called u003cstrong>Centreonu003c/strong>. (u003ca href="https://fortune.com/2020/12/15/data-breach-us-government-federal-agencies-cyberespionage-hack-solarwinds-software-supply-chain-attack/">Sounds a bit likeu003c/a> the u003cstrong>SolarWinds’s u003c/strong>u003ca href="https://fortune.com/longform/solarwinds-hack-cybersecurity-us-companies-hacked-fireeye/">hackersu003c/a> subversion of the u003ca href="https://fortune.com/2020/12/15/solarwinds-hackers-u-s-agencies/">network monitoring tool Orionu003c/a>, eh?)u003c/p>nu003cp>u003ca href="https://threatpost.com/cybercrooks-304m-romance-scams/163972/">u003cem>Happy Valentine’s Dayu003c/em>u003c/a>.u003c/p>nu003ch3>FOOD FOR THOUGHTu003c/h3>nu003cp>u003cem>Fortuneu003c/em> brought in u003cstrong>Bill Gatesu003c/strong>, u003cstrong>Microsoftu003c/strong> cofounder, billionaire philanthropist, and author of the new book u003ca href="https://fortune.com/2021/02/13/bill-gates-book-review-how-to-avoid-a-climate-disaster/">u003cem>How to avoid a climate disasteru003c/em>u003c/a>, to guest edit a package of stories we’re calling “u003ca href="https://fortune.com/packages/blueprint-for-a-climate-breakthrough/">Blueprint for a climate breakthroughu003c/a>.” Gates spoke to u003cem>Fortuneu003c/em> editor in chief Clifton Leaf u003ca href="https://fortune.com/longform/bill-gates-qa-solar-wind-energy-climate-change-breakthroughs/">about his ideasu003c/a>. He also u003ca href="https://fortune.com/2021/02/16/bill-gates-climate-change-research-green-premiums/?showAdminBar=true">penned a pieceu003c/a> advocating for the adoption of a new metric called u003cstrong>Green Premiumsu003c/strong>, which calculates the cost difference between using clean energy versus fossil fuels.u003c/p>nu003cp>u003cem>When I worked at Microsoft, my colleagues and I would pore over data about our business. We knew the numbers on our sales, our customers, and our competitors inside and out. We weren’t alone, of course—every good business leader does the same thing. The only way to know whether you’ll meet your goals is to measure where you stand at the moment. u003c/em>u003c/p>nu003cp>u003cem>But when it comes to climate change, the important metrics aren’t nearly as clear. I think this vacuum helps explain why the debate over what to do about climate change is so fraught. u003c/em>u003c/p>nu003ch3>IN CASE YOU MISSED ITu003c/h3>nu003cp>u003ca href="https://fortune.com/2021/02/16/bill-gates-guest-editor-fortune-climate-change-new-book-how-to-avoid-a-climate-disaster/">u003cstrong>Why we asked Bill Gates to be Fortune’s guest editor todayu003c/strong>u003c/a> by Clifton Leafu003c/p>nu003cp>u003ca href="https://fortune.com/2021/02/15/chip-shortage-2021-cars-computers-auto-industry-technology-covid-19/?showAdminBar=true">u003cstrong>The great chip shortage of 2021: Why carmakers and computermakers are scramblingu003c/strong>u003c/a> by Aaron Pressmanu003c/p>nu003cp>u003ca href="https://fortune.com/2021/02/16/europe-mutant-covid-clause-vaccine-contracts/">u003cstrong>Europe wants a mutant COVID clause built into its vaccine supply contractsu003c/strong>u003c/a> by Alberto Nardelli and Nikos Chrysolorasu003c/p>nu003cp>u003ca href="https://fortune.com/2021/02/16/young-climate-change-activists/">u003cstrong>These young climate activists are shaping the future of our planetu003c/strong>u003c/a> by Emma Hinchliffe and Claire Zillmanu003c/p>nu003cp>u003ca href="https://fortune.com/2021/02/16/bill-gates-innovation-net-zero-ceo-daily/">u003cstrong>Bill Gates sees innovation as key to achieving net-zerou003c/strong>u003c/a> by Alan Murrayu003c/p>nu003cp>u003ca href="https://fortune.com/2021/02/16/tiktok-misleading-privacy-practices-kids-europe-watchdog/">u003cstrong>TikTok targeted over ‘misleading’ privacy practices and ‘ambiguous’ terms in Europeu003c/strong>u003c/a> by David Meyeru003c/p>nu003cp>(u003cem>Some of these stories require a u003ca href="https://fortune.com/subscribe/">subscriptionu003c/a> to access.Thank you for supporting our journalismu003c/em>.)u003c/p>nu003ch3>BEFORE YOU GOu003c/h3>nu003cp>Ever hear of u003cstrong>Prince Hallu003c/strong>? He was a manumitted African American born in 1770 whom the u003cem>Atlanticu003c/em> u003ca href="https://www.theatlantic.com/magazine/archive/2021/03/prince-hall-forgotten-founder/617791/">ranks among America’s founding fathersu003c/a>. Hall founded the first Black Masonic Lodge in the Americas, fostered the early Black activist community in Boston, and advanced the abolitionist movement. He was “the first American to publicly use the language of the Declaration of Independence for a political purpose other than justifying war against Britain,” writes Harvard historian Danielle Allen.u003c/p>nu003cp>Let’s keep Hall’s memory alive as we celebrateu003cspan style="font-size: 1.125rem;letter-spacing: 0.035rem"> u003cstrong>Black History Monthu003c/strong> this year.u003c/span>u003c/p>nu003c/div>n"},"children":[]}]}]},{"name":"dianomi","config":{"type":"footer"},"children":[]}]}]}]}},"componentData":{},"error":null,"loading":false,"player":{"currentTime":0,"duration":0,"loading":false,"playing":false,"seek":0,"src":"","visible":false,"volume":0.5},"route":{"status":200,"redirectTo":"","redirectStatus":0,"action":"PUSH","pathname":"/2021/02/16/bloomberg-big-hack-sequel-the-long-hack-china/","search":"?","hash":""},"visible":{"search":false,"primaryNav":false,"freestar":false,"adminBar":false},"contactForm":{"submitting":false,"submitted":false,"failed":false,"validation":{},"redirect":""},"user":{"isLoggedIn":false,"accessLevel":null}}; ]]> response.json()) .then(function (data) { signPackage = data; wx.config(data); wx.ready(function () { wx.updateTimelineShareData({ title: title, link: url, imgUrl: img, success: function () {}, cancel: function () {} }); wx.updateAppMessageShareData({ title: title, desc: desc, link: url, imgUrl: img, success: function () {}, cancel: function () {} }); wx.error(function (res) { //location.href = g_url; }); }); }) } }; script.src = "https://res.wx.qq.com/open/js/jweixin-1.6.0.js"; document.head.appendChild(script); } ]]> You need to enable JavaScript to view this site.
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