The big lie: How Bloomberg used a vague article to smear China

[TaiShang]

The big lie: How Bloomberg used a vague article to smear China

By Gong Zhe
2018-10-05

Bloomberg claimed on Thursday there's a "big hack" on Amazon and Apple done by "Chinese spies" in 2014-2015, but the two companies officially responded "no."

Bloomberg's Businessweek said someone from Chinese military somehow ordered a subcontractor of Amazon, Apple and nearly 30 other companies to put an additional hack chip on the circuit of servers.

The media outlet says testers at those companies found the hack chip and reported to US government, which Amazon and Apple replied never happened.

After the companies published their denial, Businessweek updated the story, still insisting that they have six sources in the US government that confirms the case.

Although Businessweek said some of the sources are former officials, no name is mentioned for anyone to check.

"Untrue"

Both Amazon and Apple issued a statement saying Businessweek's report was incorrect.

"At no time, past or present, have we ever found any issues relating to modified hardware or malicious chips ... Nor have we engaged in an investigation with the government," read

an article on Amazon's official blog for its web service.

Amazon's response /Screenshot from AWS security blog

"Apple has never found malicious chips in our servers," Apple said in an online statement. "No one from Apple ever reached out to the FBI about anything like this, and we have never heard from the FBI about an investigation of this kind."

The first paragraphs of Apple's statement /Screenshot from Apple

Both statements insisted that they have told Businessweek multiple times in the past few months that the hack claims are false.

The flawed process

Businessweek used pictures to describe how the hack works, in which it says the chip is "as small as a sharpened pencil tip."

Small in size, the media outlet said the chip has memory, network capability and processing power.

It seems too small to be true. /Screenshot from Businessweek

Ask anyone with a little bit of knowledge about computer hardware if that technology exists and prepare to get laughed at.

Computer chips cannot go too small in size. There's limitations in the nature of silicon, which is common knowledge to hardware designers.

If anyone had such great technology, why not take down Intel? That will obviously bring more benefit.

British media outlet The Register is also questioning the possibility of making such a chip. They asked in a tweet "what lithography is it using? Seven nanometers?".

The Register also mentioned that the Businessweek article is too vague for technicians to know the details of the attack. "The Bloomberg article is not particularly technical, so a lot of us are having to guesstimate how the hack worked."

Permanent?

The Businessweek report goes on saying the chips are installed with a type of server hardware commonly known as "blades."

The reporter, Jordan Robertson, said in a Bloomberg video that hardware hack is "a permanent infection."

Robertson talks about the alleged hack in a Bloomberg video. /Screenshot from Bloomberg

How easy is it to deal with this "permanent" hack? Simply pull it off.

Modern servers are configured to be "redundant," which means there is more hardware than you need, so you can simply pull a part off while the machine is running and not break a thing.

The blades are designed with a different look compared to home desktops mainly for this reason. It's easier to pull them off and install a different one.

China's response

In its response, Ministry of Foreign Affairs of China (MOFA) said, How about we talk more about building a safe Internet instead of accusing others of hacking, especially when the accusation has come out of nowhere?

China has been trying hard to maintain the safety of the Internet: "Safety first" can be heard almost everywhere in China and hardware factories are no exception.

The MOFA said that China has been trying to maintain supply chain safety at least since 2011, when the country of other Shanghai Cooperation Organization members proposed code of conduct on info-security to the United Nations (UN).

https://news.cgtn.com/news/3d3d414d35556a4e7a457a6333566d54/share_p.html

***

US neofascist regime going rogue.

 

[Fawadqasim1]

goebbels propaganda machine at work.

 

[TaiShang]

goebbels propaganda machine at work.

But becoming less sophisticated each passing day because rest of the world has grown a thick skin to their daily smears and insults on our intellect.

Remember the global laugh at the US regime at the UNGA meeting.

That's the way people read with indifference the US regime propaganda attacking like mad dogs at some countries ever single day.

Besides, the US regime has a very big mouth and everyday making some grand allegations, accusations and threats.

This news becomes a history tomorrow, and the US regime brings in another one to the table.

The more the US regime speaks, the less convincing they get.

This news will also pass and die down quickly, but everybody still remembers NSA's hacking and spying on its enemies and allies through the US social media, tech and telecommunications companies.

@Chinese-Dragon

 

[Fawadqasim1]

Yes I totally agree with you this type of propeganda is loosing it's edge day by day
soon it won't affect anything.

 

[Jlaw]

But becoming less sophisticated each passing day because rest of the world has grown a thick skin to their daily smears and insults on our intellect.

Remember the global laugh at the US regime at the UNGA meeting.

That's the way people read with indifference the US regime propaganda attacking like mad dogs at some countries ever single day.

Besides, the US regime has a very big mouth and everyday making some grand allegations, accusations and threats.

This news becomes a history tomorrow, and the US regime brings in another one to the table.

The more the US regime speaks, the less convincing they get.

This news will also pass and die down quickly, but everybody still remembers NSA's hacking and spying on its enemies and allies through the US social media, tech and telecommunications companies.

@Chinese-Dragon

Is there any truth coming out of US media? Trump is so right to say all US media is fake news.

 

[TaiShang]

Is there any truth coming out of US media? Trump is so right to say all US media is fake news.

The genie is already out of the bottle.

Thank you Russia for selecting Mr. Trump as president.

 

[dy1022]

Shameless and always lying!

 

[JSCh]

Pentagon paper reveals strategy beyond US midterm elections
Source:Global Times Published: 2018/10/6 9:28:11

Pentagon released a report Friday, accusing China of trying to undermine the US military's industrial base. "China represents a significant and growing risk to the supply of materials and technologies deemed strategic and critical to US national security, a core threat to the American industrial base comes from China," the report said.

The move was the latest in a series of jabs aimed at Beijing. It was only yesterday when US Vice President Mike Pence publicly hurled allegations at China, claiming that Beijing had been interfering with the midterm elections and is planning to tamper with the next presidential election in 2020.

As CNN reported, the Pentagon report identified nearly 300 "vulnerabilities" that could affect the supply of critical materials and other US military supplies, and took the opportunity to once again accuse Beijing of posing a significant risk.

The report stated, "China's aggressive industrial policies have already eliminated some capabilities with critical defense functions, including solar cells for military use, flat-panel aircraft displays, and the processing of rare earth elements." It even went on to say that, "China's actions seriously threaten other capabilities, including machine tools; the production and processing of advanced materials like biomaterials, ceramics, and composites; and the production of printed circuit boards and semiconductors."

There is no doubt the Pentagon report will have an exacerbating effect on the tension already in place between the two countries. It will also strengthen US misconceptions about China, fueling "strategic rival" sentiment. The issues here will eventually become part of a campaign platform led by US political elites, designed to harm, or even sever, China-US relations.

Do Americans want to know how much China is worried about the US undermining industrial supply chain significant to China's national security? Do they know that the US has already done restrictive actions to China that Chinese people have deemed as destructive?

The White House has openly restricted high-tech exports to China to prevent military-related manufacturing. It doesn't stop there as the US requires its allies to restrict their own high-tech exports to China. From supercomputer systems to aviation and aerospace production and test equipment, underwater machinery and parts, key technologies are prohibited from being sold to China, not only by the US, but from other Western nations.

Every year China purchases chips manufactured in the US, but the deal has proven to be unstable even though it has provided huge profits for the US corporations involved. The US has used chips as a weapon to hit China's ZTE. Now, the serious risk of the US expanding chip weaponization threatens the safety of the entire Chinese industry and public consumption.

Rare earth resources are potential bargaining chips that China's holds which they have yet to use. The report also claimed that China was an "unstable country who may cut off US access" to supply sources. The risks listed in the report are potential ones, meanwhile, the US was not able to include one supply cut-off that China has used as a trade war weapon. Unfortunately, this has not prevented the US from using ZTE chips as a destructive tool, along with the restrictions they have imposed on China's high-tech purchases.

Relations and trade between the two countries make up a vast system that promotes and complements both sides while expanding the US industrial foundation. The deterioration of this relationship would lead to consequences that would force modifications within their supply chains, which can only imply uncertainty and trouble for both nations.

While the US wages a trade war against China, Washington has implemented a series of actions designed to deteriorate what is arguably the most important global relationship of the modern era. Washington made a sharp turn on their China relations, it seemed impulsive, insane even, that many suspected the precarious move would merely be short-lived mid-term election strategy. The real question now is how much of the US government's behavior will become solidified after the midterm, and this is what China really needs to take seriously.

National defense is one of the most sensitive areas of any country, and the Pentagon's assessment revealed US bottom-line thinking. The vigilance against China as indicated in the report was not an accurate representation of the "China as strategic rival" sentiment the runs through US society. However, keep in mind it also does not mean they want to extinguish Sino-US relations as a move like that would be entirely unrealistic.

Overall, the Pentagon report has made a less significant impact compared with Pence's speech. However, it did reveal the core sectors the US is making plans for should relations between the two completely deteriorate. China must attach great importance to this message while facing it with a peaceful mind.

China does not want to become a US rival, nor challenge or even take the country down. However, China is not a kite in the hands of any nation. Where and when it chooses to fly is entirely China's decision, and its presence remains down-to-earth. When the US incites, the best response is to try to settle things on our own.

 

[PeaceGen]

The big lie: How Bloomberg used a vague article to smear China

By Gong Zhe
2018-10-05

Bloomberg claimed on Thursday there's a "big hack" on Amazon and Apple done by "Chinese spies" in 2014-2015, but the two companies officially responded "no."

Bloomberg's Businessweek said someone from Chinese military somehow ordered a subcontractor of Amazon, Apple and nearly 30 other companies to put an additional hack chip on the circuit of servers.

The media outlet says testers at those companies found the hack chip and reported to US government, which Amazon and Apple replied never happened.

After the companies published their denial, Businessweek updated the story, still insisting that they have six sources in the US government that confirms the case.

Although Businessweek said some of the sources are former officials, no name is mentioned for anyone to check.

"Untrue"

Both Amazon and Apple issued a statement saying Businessweek's report was incorrect.

"At no time, past or present, have we ever found any issues relating to modified hardware or malicious chips ... Nor have we engaged in an investigation with the government," read

an article on Amazon's official blog for its web service.

Amazon's response /Screenshot from AWS security blog

"Apple has never found malicious chips in our servers," Apple said in an online statement. "No one from Apple ever reached out to the FBI about anything like this, and we have never heard from the FBI about an investigation of this kind."

The first paragraphs of Apple's statement /Screenshot from Apple

Both statements insisted that they have told Businessweek multiple times in the past few months that the hack claims are false.

The flawed process

Businessweek used pictures to describe how the hack works, in which it says the chip is "as small as a sharpened pencil tip."

Small in size, the media outlet said the chip has memory, network capability and processing power.

It seems too small to be true. /Screenshot from Businessweek

Ask anyone with a little bit of knowledge about computer hardware if that technology exists and prepare to get laughed at.

Computer chips cannot go too small in size. There's limitations in the nature of silicon, which is common knowledge to hardware designers.

If anyone had such great technology, why not take down Intel? That will obviously bring more benefit.

British media outlet The Register is also questioning the possibility of making such a chip. They asked in a tweet "what lithography is it using? Seven nanometers?".

The Register also mentioned that the Businessweek article is too vague for technicians to know the details of the attack. "The Bloomberg article is not particularly technical, so a lot of us are having to guesstimate how the hack worked."

Permanent?

The Businessweek report goes on saying the chips are installed with a type of server hardware commonly known as "blades."

The reporter, Jordan Robertson, said in a Bloomberg video that hardware hack is "a permanent infection."

Robertson talks about the alleged hack in a Bloomberg video. /Screenshot from Bloomberg

How easy is it to deal with this "permanent" hack? Simply pull it off.

Modern servers are configured to be "redundant," which means there is more hardware than you need, so you can simply pull a part off while the machine is running and not break a thing.

The blades are designed with a different look compared to home desktops mainly for this reason. It's easier to pull them off and install a different one.

China's response

In its response, Ministry of Foreign Affairs of China (MOFA) said, How about we talk more about building a safe Internet instead of accusing others of hacking, especially when the accusation has come out of nowhere?

China has been trying hard to maintain the safety of the Internet: "Safety first" can be heard almost everywhere in China and hardware factories are no exception.

The MOFA said that China has been trying to maintain supply chain safety at least since 2011, when the country of other Shanghai Cooperation Organization members proposed code of conduct on info-security to the United Nations (UN).

https://news.cgtn.com/news/3d3d414d35556a4e7a457a6333566d54/share_p.html

***

US neofascist regime going rogue.


View attachment 503421

why wouldn't they send non-tampered hardware during an company-purchase evaluation process?

why would Apple and Amazon actually admit to a hack of this size? it would only harm them.

and more importantly : the future will point out if China really *is* compromising hardware sold to foreign countries.
i certainly wouldn't be surprised if they did.

 

[TaiShang]

US regime needs to be more sophisticated.

***

UK cyber security agency backs Apple, Amazon China hack denials

CGTN
2018-10-07 09:46 GMT+8

Britain's national cybersecurity agency said on Friday it had no reason to doubt the assessments made by Apple Inc and Amazon.com Inc challenging a Bloomberg report that their systems contained malicious computer chips inserted by Chinese intelligence services.

Read more: Amazon--Setting the Record Straight on Bloomberg BusinessWeek's Erroneous Article

Bloomberg Businessweek on Thursday cited 17 unnamed intelligence and company sources as saying that Chinese spies had placed computer chips inside equipment used by around 30 companies, as well as multiple U.S. government agencies, which would give Beijing secret access to internal networks.

"We are aware of the media reports but at this stage have no reason to doubt the detailed assessments made by AWS and Apple," said the National Cyber Security Centre, a unit of Britain's eavesdropping agency, GCHQ. AWS refers to Amazon Web Services, the company's cloud-computing unit.

"The NCSC engages confidentially with security researchers and urges anybody with credible intelligence about these reports to contact us," it said.

Apple contested the Bloomberg report on Thursday, saying in a statement that its own internal investigations found no evidence to support the story's claims and that neither the company nor its contacts in law enforcement, were aware of any investigation by the FBI into the matter.

Apple's recently retired general counsel, Bruce Sewell, told Reuters he called the FBI's then-general counsel James Baker last year after being told by Bloomberg of an open investigation into Super Micro Computer Inc, a hardware maker whose products Bloomberg said were implanted with malicious Chinese chips.

"I got on the phone with him personally and said, ‘Do you know anything about this?," Sewell said of his conversation with Baker. "He said, 'I've never heard of this, but give me 24 hours to make sure.' He called me back 24 hours later and said 'Nobody here knows what this story is about.'"

Baker and the FBI declined to comment Friday.

https://news.cgtn.com/news/3d3d674e7a6b6a4e7a457a6333566d54/share_p.html

 

[seesonic]

why wouldn't they send non-tampered hardware during an company-purchase evaluation process?

why would Apple and Amazon actually admit to a hack of this size? it would only harm them.

and more importantly : the future will point out if China really *is* compromising hardware sold to foreign countries.
i certainly wouldn't be surprised if they did.

Stop barking to the tune of white press

How would be possible for a 'sweat' factory of the world come out with some sophisticated attack ?

The only people i would count on would the engineers in Bangalore lead by Indian CEOs.

 

[JSCh]

OCTOBER 8, 2018 / 3:37 AM / UPDATED 10 HOURS AGO
Apple tells Congress it found no signs of hacking attack | Reuters
Joseph Menn

SAN FRANCISCO (Reuters) - Apple Inc’s (AAPL.O) top security officer told Congress on Sunday that it had found no sign of suspicious transmissions or other evidence that it had been penetrated in a sophisticated attack on its supply chain.

Apple Vice President for Information Security George Stathakopoulos wrote in a letter to the Senate and House commerce committees that the company had repeatedly investigated and found no evidence for the main points in a Bloomberg Businessweek article published on Thursday, including that chips inside servers sold to Apple by Super Micro Computer Inc (SMCI.PK) allowed for backdoor transmissions to China.

“Apple’s proprietary security tools are continuously scanning for precisely this kind of outbound traffic, as it indicates the existence of malware or other malicious activity. Nothing was ever found,” he wrote in the letter provided to Reuters.

Stathakopoulos repeated Apple’s statements to the press that it never found malicious chips or vulnerabilities purposely planted in any server or been contacted by the Federal Bureau of Investigation (FBI) about such concerns. He said he would be available to brief Congressional staff on the issue this week.

The letter follows statements on Friday by Britain’s National Cyber Security Centre and on Saturday by the U.S. Department of Homeland Security that those agencies have no reason to doubt denials from Apple and Amazon.com Inc (AMZN.O) that they had discovered backdoored chips.

Bloomberg said on Friday it stood by its story, which was based on 17 anonymous sources. Some allegations were based on fewer accounts or even a single unnamed source, Apple noted in its letter.

A Bloomberg spokeswoman did not immediately respond to questions sent on Sunday.


Reporting by Joseph Menn; Editing by Marguerita Choy

 

[gambit]

why wouldn't they send non-tampered hardware during an company-purchase evaluation process?

why would Apple and Amazon actually admit to a hack of this size? it would only harm them.

and more importantly : the future will point out if China really *is* compromising hardware sold to foreign countries.
i certainly wouldn't be surprised if they did.

Motherboards are commodity products, meaning they are massed produced and most likely spot sampled functionality tested, meaning only a percentage of a batch is tested. Full %100 testing would be time and financially prohibitive. So already the odds of detecting a hardware based 'backdoor' is low. Further, motherboard functionality testing at the manufacturing source do not contains all the operations that a normal user would put on the board, such as video games or word processing. The MB is tested mostly for connectivity to all devices on the board.

Here is a sample of what functionality testing at the manufacturer level looks like...

http://www.nexlogic.com/pcb-testing/functional-testing/

Functional test (FCT) is used as a final manufacturing step. It provides a pass/fail determination on finished PCBs before they are shipped. An FCT’s purpose in manufacturing is to validate that product hardware is free of defects that could, otherwise, adversely affect the product’s correct functioning in a system application.

Note the highlighted. That is one and usually ONLY testing criteria: Pass/Fail.

Of the batched testing, the QA dept will pull a percentage to where each unit will be configured to full user specs, meaning peripheral components like CPU, graphics, memory, and storage devices are fully installed and tested as if it is a shippable computer. So we are looking at a PERCENTAGE OF A PERCENTAGE that is actually tested like a PC. The odds now of detecting a hardware based 'backdoor' is now reduced even further and if the manufacturer itself is involved in the espionage venture, it will up to the final user(s) to find out if his wares are free of any type of 'backdoor' accessibility.

Note so far in this thread that no one have put forth the argument that this hardware based 'hack' is technically impossible.

 

[Kyle Sun]

why wouldn't they send non-tampered hardware during an company-purchase evaluation process?

why would Apple and Amazon actually admit to a hack of this size? it would only harm them.

and more importantly : the future will point out if China really *is* compromising hardware sold to foreign countries.
i certainly wouldn't be surprised if they did.

Are you surprised that the US gov spying the entire world?

 

[master_13]

Motherboards are commodity products, meaning they are massed produced and most likely spot sampled functionality tested, meaning only a percentage of a batch is tested. Full %100 testing would be time and financially prohibitive. So already the odds of detecting a hardware based 'backdoor' is low. Further, motherboard functionality testing at the manufacturing source do not contains all the operations that a normal user would put on the board, such as video games or word processing. The MB is tested mostly for connectivity to all devices on the board.

Here is a sample of what functionality testing at the manufacturer level looks like...

http://www.nexlogic.com/pcb-testing/functional-testing/

Note the highlighted. That is one and usually ONLY testing criteria: Pass/Fail.

Of the batched testing, the QA dept will pull a percentage to where each unit will be configured to full user specs, meaning peripheral components like CPU, graphics, memory, and storage devices are fully installed and tested as if it is a shippable computer. So we are looking at a PERCENTAGE OF A PERCENTAGE that is actually tested like a PC. The odds now of detecting a hardware based 'backdoor' is now reduced even further and if the manufacturer itself is involved in the espionage venture, it will up to the final user(s) to find out if his wares are free of any type of 'backdoor' accessibility.

Note so far in this thread that no one have put forth the argument that this hardware based 'hack' is technically impossible.

problem is, Bloomberg claimed China put that spy chip on EVERY SINGLE ONE motherboard, you'd think spot check would have caught it, since it is installed on EVERY SINGLE ONE.