What's replacing P2P, BitTorrent as pirate hangouts?

Driven by increased crackdowns on BitTorrent sites such as The Pirate Bay, software pirates are fast-moving their warez to file-hosting Web sites. Hyperlinks to the software can then be distributed by pirates via Web sites, instant messages, or social media sites such as Twitter, said Vic DeMarines, CEO of anti-piracy software vendor V.I. Labs. "It's incredibly easy to use. Sites such as RapidShare, Megaupload, and Hotfile let anonymous users upload large files such as cracked software for free. And what you get is essentially your own private FTP server," DeMarines said.

These memberships, such as the 30-day premium access for $6.99 Euros at Rapidshare, let users download files immediately and without any caps on bandwidth. While sites such as RapidShare allow free downloads, they make their money by charging heavy downloaders for premium memberships. Trade in pirated digital goods , whether it is movies, music or e-books or software, is what drives the popularity and business model of firms like RapidShare. A spokeswoman for Cham, Switzerland-based Rapidshare declined to comment on the V.I. Labs report, saying she would need more information. The site told The New York Times earlier this year that it hosted 10 petabytes of data and up to 3 million downloaders at a time . The Association of American Publishers estimates that half of the pirated books found by its members were linked to Rapidshare. "There's a lot of money being made," said DeMarines. "Without hosting pirated goods, I'm not sure what their revenue model would be." According to a recent investigation by V.I. Labs into the availability of pirated software from a sample of 43 vendors, 100% were on RapidShare.

The site is already among the top twenty most popular in the world, according to Alexa. Though Rapidshare has faced lawsuits related to piracy, DeMarines says it and other file-hosting sites are tricky to prosecute legally becuase uploaders are not required to register or identify themselves. Uploads and downloads to Rapidshare account for 5% of all Internet traffic globally, says German networking vendor Ipoque. Also, Rapidshare tries to distance itself from any knowledge of the pirated goods by not filtering or monitoring the content on its servers. "For us, everything is just a file, no matter what," a spokeswoman told The Times in March. The company even grants certain organizations direct access into their service, so that they can go ahead and delete the hyperlinks and pirated files themselves, DeMarines said.

DeMarines said Rapidshare does comply with the Safe Harbor Provisions of the U.S.' Digital Millennium Copyright Act (DMCA) by quickly taking down pirated files when notified by the copyright holders. Peer-to-peer networking (P2P) does still remain the largest channel for distributing pirated software, movies and other digital content. The most popular network remains BitTorrent , which is used by six out of 10 P22 users, V.I. Labs said. Ipoque said it enables between 43% to 70% of piracy, depending on the region of the world. eDonkey is a distant second, with 20% share, despite hosting almost 900,000 users and 77 million files at any given time.

But file-hosting is growing much faster, Ipoque said, already enabling between 15% to 35% of digital piracy, depending on the region of the world. Once-popular Gnutella is ranked third, with a market-share in the single digits. DeMarines said he expects file-hosting sites to eventually supplant P2P. "P2P is on its way down. Other long-running methods for distributing warez are either stagnant or shrinking. They're too visible, and so the copyright organizations are going to take these BitTorrent tracker sites out," he said.

Usenet newsgroups, for instance, have lost popularity due to the large amount of pornography and malware mingled in with the warez, DeMarines said. Internet Relay Chat (IRC) is "not favored" as a way to transmit files, though announcements and links on IRC to warez hosted on file-hosting sites is growing, DeMarines said.

Elpida signs on another Taiwan DRAM maker

Elpida signed another Taiwanese DRAM maker, Winbond Electronics, to a manufacturing and technology partnership on Wednesday, putting an end to rumors that the company might join a rival alliance that uses technology from U.S.-based Micron Technology. Elpida will provide Winbond with advanced DRAM manufacturing and product technology as part of the deal. "The outsourcing agreement is the first step of a business partnership the companies intend to pursue further," the statement says. Winbond will begin producing GDDR3 (graphics double data rate, third generation) and GDDR5 for Elpida by the end of this year, the companies said in a joint statement.

Elpida has moved fast to shore up support for its technology in Taiwan, where over-building among DRAM makers led to a glut in DRAM chips and inability to repay loans early this year. Consolidation efforts have caused companies on the island to rally around two main foreign technology providers, Elpida and Micron. The Taiwan government stepped in to help companies delay loan repayments and worked to encourage consolidation among DRAM makers on the island. The agreement with Winbond puts four Taiwanese DRAM manufacturers in Elpida's camp, versus two for Micron. Elpida and Powerchip also operate a joint venture DRAM manufacturer in Taiwan, Rexchip Electronics. Winbond joins ProMOS Technologies, which inked an outsourcing deal with Elpida last week, and Powerchip Semiconductor, a long time Elpida partner.

Micron has signed up Nanya Technology, and together they operate joint venture Inotera Memories. Winbond began seeking a new technology partner early this year when Germany's Qimonda, which previously worked with Winbond, filed for bankruptcy.

Cisco extends security controls to 'dark Web'

Cisco is tackling the so-called "dark Web" of online content that's not easily indexed or categorized by adding new usage controls to its IronPort S-Series Web Security Appliances. The IronPort Web Usage Controls software has an engine that reads a Web page on the fly and analyzes the content to decide if it's objectionable or off limits according to corporate policy, says Vivek Bhandari, a product marketing manager at Cisco. The new technology is packaged as a software blade that works with Cisco's URL filtering database to make decisions about user Web surfing to enforce acceptable-use policies.

Simply categorizing Web sites into lists - such as sports, shopping, hate sites or porn - is no longer sufficient because the Internet is now filled with highly transient and often dangerous sites that comprise the dark Web. "These sites are coming up and down so fast," Bhandari says, noting that the proliferation of blogs and social networking sites, with Web 2.0 technology underpinnings, are also contributing to an explosion in Web content. Cisco's S-Series appliances can perform malware detection and blocking. The dark Web may constitute 80% of objectionable content, outside the 20% of Web sites that can still be put neatly into list form, Cisco says. The new Web Usage Controls software adds the ability to monitor, block or warn users about Web traffic based on a method that combines URL filtering lists with contextual heuristics for analyzing content and checking hidden tags. With the configuration Cisco is advising customers to use, about 90% of objectionable dark Web content violating policy will be detected via IronPort Web Usage Controls without causing the false positive rate to spike, Bhandari says. Cisco's URL filtering database includes 65 URL categories and is updated every 5 minutes through Cisco's security intelligence operations.

IronPort S-Series appliances with Web Usage Controls, available now, start at $8,500.

For sale: Cisco data center rival Brocade

Brocade has reportedly put itself up for sale, a development that portends significant consolidation within the data center IT industry. Likely suitors are HP and Oracle, among others, the WSJ reports. According to the Wall Street Journal, Brocade has enlisted Qatalyst Group to shop the company around. HP, Oracle and Brocade all declined comment for the WSJ story.

HP would be interested in Brocade to fill out its data center switching and storage-area network (SAN) portfolio as it battles former ally Cisco for next-generation data center buildouts. Brocade, which told Network World it does not comment on "rumor or speculation," has a market cap of $3 billion. HP resold Cisco routers and switches for years before ramping R&D in its own ProCurve line.   Slideshow: 2009's hottest tech M&A deals   Cisco countered by developing a data center blade server system to compete with HP's and IBM's offerings. Acquiring Brocade would fill out both its LAN and SAN switching portfolios for the data center, observers note. IBM is also a reseller of Cisco switches and routers but recently agreed to OEM Brocade's equipment, which it obtained from its acquisition of Cisco rival Foundry Networks.   HP resells Brocade FibreChannel and FibreChannel-over-Ethernet (FCoE) SAN switches under an OEM arrangement but is challenged in offering a complete data center switching line via its internally developed ProCurve brand.

Similarly, software giant Oracle would become a more complete player in the data center with a Brocade acquisition. But some analysts say Brocade would be a stretch for Oracle, and perhaps too disruptive near term for HP. "Much has to do with Oracle's long-term growth plans," states Oppenheimer & Co. analyst Ittai Kidron in a bulletin on the Brocade speculation. "If the company truly plans to become a systems company (one-stop shop software/hardware), then Brocade would be a nice fit, especially including Sun Microsystems with no overlap. Oracle is in the process of acquiring Sun Microsystems for more than $7 billion, which gives it server hardware and software; Brocade would give Oracle LAN and SAN switching hardware and make the company a powerful provider of hardware as well as software. We're a bit in the dark on strategy here. That said, there would be massive overlap with HP's ProCurve networking unit, which we believe would be disruptive.

On HP, Kidron writes: "Brocade would add the missing data center switch architecture as well as a strong presence in the SAN switch market. Also, IBM and EMC are 10% customers for Brocade and could be lost as customers (along with HP's 10% business of Brocade)." If HP acquired Brocade, business from IBM and others could swing back to Cisco, according to UBS analysts Nikos Theodosopoulos. Speculation has it the company will flesh out its Project Stratus cloud computing strategy and/or announce a significant alliance or acquisition with a major IT player. A dark horse in the Brocade stakes would be Juniper, according to investment firm UBS. Juniper and IBM are tightly aligned in data center and cloud computing, and a Brocade acquisition would flesh out much of what's missing in the IBM/Juniper data center arsenal - specifically, an FCoE line of switches. "We believe Juniper may be another potential buyer of Brocade, although recent commentary from Juniper suggests it is not looking at large deals now," UBS analyst Theodosopoulos states in a bulletin on the prospects of a Brocade acquisition. "An acquisition of Brocade would make sense for Juniper, in our view, because it is the only other clear networking partner for IBM, while IBM is currently supporting Juniper's development of an FCoE switch, alleviating some of the R&D budgetary constraints on Juniper as it pursues both LTE & FCoE technologies." Juniper has a major announcement slated for Oct. 28 in New York. IBM may also be interested in Brocade but that would dash its Juniper partnership, kill HP and EMC as 10% revenue customers, and get IBM back in the network and SAN hardware business which may not appeal to the company, Kidron notes. Acquiring Brocade would give Dell, a maker of servers for the data center, more credibility in that market with minimal overlap, according to Kidron.

Another wild card is Dell. But Dell just acquired Perot Systems last month for $4 billion so the prospects of making another major acquisition so soon after is remote, Kidron states. No deal is imminent for Brocade and the company could still dash a potential deal, the WSJ reports. That doesn't necessarily rule them out though. "I think Dell could potentially make a play for them; I've heard through some of their channel that there is a big push for capturing some [data center] share," says Frost & Sullivan analyst Vanessa Alvarez. But proactively seeking out possible acquirers may give the company more control over the process and over its destiny, observers note.

New York Times tricked into serving scareware ad

Scammers tricked the New York Times' Digital Advertising department into placing a malicious ad for fake antivirus software on the NYTimes.com Web site over the weekend, the company confirmed Monday. According to the Times, the scammers initially claimed to be Internet phone provider Vonage, and had placed what appeared to be legitimate Vonage ads on the Web site. The newspaper had warned of the scam advertisement Sunday, after receiving about 100 e-mails from concerned readers.

However, sometime over the weekend, they switched these ads for aggressive pop-up advertisements that tried to trick victims into thinking that their computers were infected. When the complaints started pouring in, the Times first suspected that the ad had been unauthorized, and pulled third-party advertisements from the site. The point of the scam was to sell worried computer users a product called Personal Antivirus, a fake "scareware" product that bombards victims with popup ads until they either hand over their credit card information or somehow manage to remove the program. But on Monday spokeswoman Diane McNulty confirmed that the ad had been submitted directly to the company's online ad department. "The culprit masqueraded as a national advertiser and provided seemingly legitimate product advertising for a week," she said via email. "Over the weekend, the ad being served up was switched so that an intrusive message, claiming to be a virus warning from the reader's computer, appeared. " Technology executive Troy Davis was hit with the ad after he clicked on a Times story about Dubai on Saturday night. This gave the criminals a way to include embedded Web pages in their copy that could be hosted on a completely different server, outside of the control of the Times.

After his antivirus software warned him not to visit the article, he performed an analysis of the site and discovered that the Times was allowing advertisers to embed an HTML element known as an iframe into their advertisements. Apparently the scammers waited until the weekend, when it would be hardest for IT staff to respond, before switching the ad by inserting new JavaScript code into that iframe. It was, of course, all just a fake. That code redirected Davis's browser to the Web site that served a pop-up ad designed to look like a Windows system scan that had found security problems on his system.