Joe Biden’s cybersecurity gap

Part of it is sport. The T-Mobile hacker revealed today that he breached the company—it apparently had an unsecured server accessible online—in order to gain attention.

But, of course, many hacks are far more serious. The SolarWinds attack opened a backdoor into government agencies and about 100 companies, including giants like Microsoft. In the last few months, the State Department and the Justice Department’s federal prosecutors have also been compromised. We still have no idea the effects of these breaches. 

So yesterday, President Joe Biden hosted a meeting with many of the world’s largest tech companies—Apple, Microsoft, and Amazon among them—to announce billions of dollars in upgrades and training to help strengthen the state of American cybersecurity. 

“The federal government can’t meet this challenge alone,” Biden said. “You have the power, the capacity and the responsibility, I believe, to raise the bar on cybersecurity.”

The details here are important, and the big investments here seem worthwhile. There is a huge emphasis on job training, which is critical at a time when so many people are unemployed. Microsoft appears to have brought the most to the table, pledging a four-fold increase in cybersecurity spending, at $4 billion annually through 2026, and to make $150 million worth of training available to federal, state, and local governments. Google, too, said it would spend $10 billion—timeframe unclear—and “help” train 100,000 people for new cybersecurity jobs. Apple, which is immersed in its own privacy and security snafu, pledged to harden its supply chain. 

But it’s also important to be skeptical about this. Cybersecurity is all about finding and patching holes, and the gaps here are glaring. 

As Axios points out, Facebook is nowhere to be seen. Amazon—whose indifference toward government interests is laid out clearly in reporting like Alex MacGillis’ excellent book Fulfillment: Winning and Losing in One-Click America—pledged to make publicly available some training it already gives to some workers. The company also pledged to make multi-factor identification devices available to its cloud computing clients, a supremely weird offer since you’d expect those customers to have smartphones that could serve the same purpose. 

Hacks are getting more sophisticated all the time, as governments invest more resources into cyberwarfare to go after other countries. As the HBO documentary The Perfect Weapon pointed out, the US kicked off the current state of affairs with the 2010 Stuxnet virus that physically destroyed part of Iran’s nuclear facilities—opening up a Pandora’s box around the rules of cyber engagement. 

Will these changes change anything in the short term? Probably not. As I’ve previously written, anyone can hold a company ransom for as little as $10. But whatever happens, let’s hope they do it soon—before it’s too late. 

Correction (8/26/26): An earlier version of this article inaccurately stated that the SolarWinds hack had impacted 100 government agencies. In fact, it impacted about 100 companies.

Kevin T. Dugan
@kevintdugan

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With friends like these. Facebook has temporarily disabled the ability to search through friends lists of people located in Afghanistan to try to keep the Taliban from using its services to find and kill people connected with the US government. The unprecedented move comes as the Taliban has demonstrated its own Internet savviness by using social media to communicate with the world. 

News ain't free. Some news publishers that work with Apple News will see their bills cut by half, after the tech company lowered the commission it charges them on in-app purchases to 15%. News publishers, especially Rupert Murdoch's News Corp., have been pushing for more concessions from Apple and other online publishers as the industry continues to hemorrhage jobs. 

Electric engine. Daniel Ninivaggi, a top executive under corporate raider Carl Icahn, will take over Lordstown Motors as CEO. Ninvaggi ran Icahn's automotive parts and aftermarket service network, and was the head of Icahn Enterprises. The car company—which recently disclosed it had little capital and whose founder was recently criminally charged with fraud—saw its stock jump 25%. 

FOOD FOR THOUGHT

Robot for rent: If you're a small manufacturer with tight margins, it probably makes more sense to pay workers for manual labor rather than borrow to invest in technology that can reduce labor costs. But now, the calculus is changing as robots have become cheaper, and business owners are seeking to keep labor costs down.  

Formic Technologies is a company pitching robots to small manufacturers, with backing from giants like Tiger Global. They offer their robots for rent at about $10 per hour, and have already led to layoffs. 

Not only does this have the potential for an incalculable human and economic toll, this also just strikes me as a bad deal for the manufacturers. The joke is that people laid off by robots can get new jobs fixing the robots that replaced them—and that's going to cost money, too. 

From the article:

“Melvin runs 24 hours a day, all three shifts, and that replaced three full operators,” said President Tammy Barras, adding that she is saving about $60,000 in labor costs a year with the one robot alone. “We've had to increase our wages quite significantly this year because of what is going on in the world. And luckily, Melvin has not increased his pay rate. He doesn't ask for a raise.”

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BEFORE YOU GO

Holmes alone. In 2016, ex-Theranos CEO Elizabeth Holmes met with a book publisher to try to tell her side of the story, just as her blood-testing company was imploding. Holmes, the deep-voiced former wunderkind on trial for criminal fraud, will soon be taking the stand to tell that same story, trying to convince a jury that her supreme belief in the company's technological promise makes her innocent of accusations she ripped off investors and essentially ran a scam. 

I'll be watching this trial closely. It would be a fool's errand to try to predict the outcome of a trial, even if you've read the excellent investigative reporting in John Carreyrou's seminal book Bad Blood, but no matter the verdict, this will be the end of an era in Silicon Valley. Just like in any criminal trial, there will be plenty of documents offered into public evidence — promising an unusual spotlight in an industry that's more comfortable operating in "stealth mode."