TIME cybersecurity

Obama: Sony Response to Hack Sets Bad Precedent

President Obama Holds End-Of-Year News Conference At The White House
U.S. President Barack Obama speaks during his last news conference of the year in the James Brady Press Briefing Room of the White House on Dec. 19, 2014 in Washington D.C. Alex Wong—Getty Images

"All of us have to adapt to the possibility of cyber attacks"

President Obama said he does not believe the Sony hack is an act of war, defending his position that Sony made a mistake in pulling The Interview.

“I don’t think [the hack] was an act of war. I think it was an act of cyber vandalism that was very costly, very expensive. We take it very seriously,” Obama said during CNN’s State of the Union, which aired Sunday.

Obama said in an earlier press conference Friday that he wished Sony Pictures, which suffered a devastating hack last month, had consulted him before deciding to cancel the film’s slated release. The fictional comedy starring Seth Rogen and James Franco is about an assassination attempt on North Korean dictator Kim Jong-un. Terror threats surfaced last week targeting theaters who planned to screen the movie.

The FBI said on Friday there was enough intelligence to conclude the North Korean government was responsible for the hack, which North Korea has continued to deny.

Sony Entertainment CEO Michael Lynton appeared on CNN shortly after Obama’s Friday statement, and said that Obama and the public “are mistaken as to what actually happened.” Lynton said that The Interview was pulled because many major theater chains decided not to show the film.

In Sunday’s interview, Obama reinforced his sympathy for Sony’s cancellation of the film for practical reasons, but stressed again that Sony had nonetheless set a precedence for self-censorship in several sectors.

“What happens if in fact there’s a breach in CNNs cyberspace?” Obama said during the broadcast. “Are we going to suddenly say, ‘Well, we better not report on North Korea?’ So the key here is not to suggest that Sony was a bad actor. It’s making a broader point that all of us have to adapt to the possibility of cyber attacks.”

[CNN]

TIME Social Networking

Reddit to Award Lottery Fund to 950,000 Lucky Users

Flush with $50 million in capital, the social media site finds a novel way to give back

Reddit announced new details of a lottery fund that will siphon off one-tenth of the company’s share value and randomly distribute it to roughly 950,000 lucky users, in a bid to encourage contributions to the media-sharing website.

“To celebrate all of you and your contributions, we plan to give away reddit notes in a random lottery,” the company announced in an official blog post on Friday. Reddit relies on users to cull the web for interesting content and submit it to the wider community for an “up” or “down” vote, thereby driving stories of general interest to the top of the site.

Reddit first announced the lottery payout idea in September 2014, shortly after it closed a $50 million round of fundraising. Starting in fall of 2015, Reddit plans to notify the winning users to set up an online wallet, into which the company will deposit a “Reddit Note,” which users will be able to trade on an open exchange.

TIME Media

Sony Chief Says ‘We Have Not Caved’ on The Interview

"We have not given up," Michael Lynton said after his studio cancelled the movie under pressure

Sony Pictures Entertainment CEO Michael Lynton defended his company’s decision to cancel the release of The Interview on Friday, even as the company refused to rule out releasing the movie in other ways.

Lynton said Sony’s decision was prompted by movie theaters opting not to show the film after hackers, who U.S. officials believe are linked to North Korea and who have wreaked havoc on the studio by disclosing emails and other company information, threatened 9/11-style attacks. Moments earlier, President Barack Obama had called the move to cancel the Christmas Day release a “mistake.”

“The unfortunate part is in this instance the President, the press, and the public are mistaken as to what actually happened,” Lynton said on CNN. “When it came to the crucial moment… the movie theaters came to us one by one over the course of a very short period of time. We were completely surprised by it.”

Read more: You can’t see The Interview, but TIME’s film critic did

Sony said in a statement later Friday that its decision was only about the Christmas Day release.

“After that decision, we immediately began actively surveying alternatives to enable us to release the movie on a different platform,” the studio said. “It is still our hope that anyone who wants to see this movie will get the opportunity to do so.”

Obama told reporters he wished Sony had reached out to him before canceling the film’s Christmas day release. It depicts a fictional assassination attempt against North Korean leader Kim Jong Un.

“We cannot have a society where some dictator someplace can start imposing censorship here in the United States,” he said. “Imagine if producers and distributors and others start engaging in self-censorship because they don’t want to offend the sensibilities of someone who’s sensibilities probably need to be offended.”

Lynton denied the studio had given into the hackers’ threats.

“We have not caved. We have not given up,” he said. “We have always had every desire to have the American public see this movie.”

Read next: Obama Says Sony “Made a Mistake” Pulling ‘The Interview’

TIME Companies

Uber Is Trying to Patent Its Surge Pricing Technology

The practice recently fueled criticism when users in Sydney faced rising prices as they tried to flee the area of a hostage crisis

The fast-growing ride-sharing service Uber wants to patent a pricing technology that has come under fire from critics who accuse the company of price gouging.

The technology, which Uber calls “surge pricing,” is among at least 13 patent applications the company has filed with the U.S. patent office, which typically become public 18 months after filing, Bloomberg reports. So far, most of the applications have been initially rejected for “obviousness” or because they were otherwise ineligible, but there’s been no decision yet on the surge pricing technology.

Read more: This is how Uber’s surge pricing works

The company, which was founded in San Francisco in 2009 and has already expanded to more than 50 countries, has defended the practice, which adjusts prices in real time based on the amount of demand in the area.

But Uber, already under pressure in jurisdictions around the world over regulatory and safety concerns, drew renewed criticism when the service raised prices in Sydney earlier this week as users were trying to leave the area around a hostage crisis.

[Bloomberg]

TIME White House

Obama Says Sony ‘Made a Mistake’ Pulling The Interview

"That’s not who we are," Obama said

President Barack Obama said Friday that Sony “made a mistake” in pulling its film The Interview from distribution following a cyberattack that American officials have linked to North Korea.

Speaking to reporters at the White House, Obama confirmed the FBI’s assessment that North Korea was behind the attack. He said he wished the studio had reached out to him before canceling the film’s release, and that he fears it sets a bad precedent for the nation.

“We cannot have a society where some dictator someplace can start imposing censorship here in the United States,” Obama said. “Imagine if producers and distributors and others start engaging in self-censorship because they don’t want to offend the sensibilities of someone who’s sensibilities probably need to be offended.”

“That’s not who we are,” Obama added, noting that the 2013 Boston Marathon bombing did not deter runners from running this year. “That’s not what America’s about.”

Sony Pictures Entertainment CEO Michael Lynton, appearing on CNN shortly after Obama spoke, defended the studio. “We have not caved,” he said. “We have not given up. We have persevered and we have not backed down. We have always had every desire to have the American public see this movie.”

Obama promised that the United States would respond “proportionally” to the attack, but would not detail those actions publicly.

“We will respond,” he said. We will respond proportionally, and we will respond at a place and time that we choose.”

Read more: The 7 most outrageous things we learned from the Sony hack

TIME Mobile

T-Mobile to Pay $90 Million to Settle Cramming Case

T-Mobile
An employee sets up a new Samsung Electronics Co. Galaxy 3 smartphone for a customer at a T-Mobile US Inc. retail store in Torrance, California, U.S., on Monday, Nov. 4, 2013. Bloomberg—Bloomberg via Getty Images

Wireless carrier had originally called FTC lawsuit "unfounded"

T-Mobile has agreed to pay at least $67.5 million in customer refunds to settle claims that its customers were the victims of cramming, the Federal Trade Commission said Friday. Cramming is a once-common tactic in the telecom industry through which third parties hide unwanted charges for things like horoscopes and love tips in customers’ wireless bills.

In addition to the refunds, T-Mobile will pay $18 million in fines and penalties to attorneys general in every state and Washington D.C., as well as a $4.5 million fine to the Federal Communications Commission.

“Mobile cramming is an issue that has affected millions of American consumers,” FTC Chairwoman Edith Ramirez said in a statement. “Consumers should be able to trust that their mobile phone bills reflect the charges they authorized and nothing more.”

The FTC originally filed a lawsuit against T-Mobile over cramming claims in July. At the time, T-Mobile CEO John Legere, who has staked the company’s reputation on being more fair to customers than rival wireless carriers, called the allegations “unfounded and without merit.” T-Mobile did not immediately respond to a request for comment Friday.

T-Mobile will be required to contact all current and former customers who had unwanted charges crammed into their bills and offer them refunds. The company will also have to get customers’ consent before putting third-party charges on their bills in the future.

The T-Mobile case is the latest in a series of cramming settlements that the FTC has brokered. AT&T agreed to pay $105 million in refunds and fines for cramming charges in October.

TIME intelligence

FBI Accuses North Korea in Sony Hack

North Korean leader Kim inspects the Artillery Company under the KPA Unit 963, in this undated photo released by North Korea's KCNA in Pyongyang
North Korean leader Kim Jong Un inspects the Artillery Company under the Korean People's Army Unit 963 in Pyongyang on Dec. 2, 2014 KCNA/Reuters

Fallout led Sony to pull The Interview

The FBI on Friday accused the North Korean government of being behind the devastating hack on Sony Pictures Entertainment that eventually prompted it to cancel the release of The Interview, the first formal statement that the U.S. government has concluded the isolated nation is responsible for the cyberattack.

“The FBI now has enough information to conclude that the North Korean government is responsible,” the bureau said in a statement. “Though the FBI has seen a wide variety and increasing number of cyber intrusions, the destructive nature of this attack, coupled with its coercive nature, sets it apart.”

President Barack Obama, asked Friday about Sony’s decision to pull The Interview, said: “Yes, I think they made a mistake”

The FBI said it determined North Korea was responsible based on an analysis of the malware involved and its similarities to previous attacks the U.S. government has attribute to North Korean-allied hackers, including an assault on South Korean banks and media outlets in 2013. These include “similarities in specific lines of code, encryption algorithms, data deletion methods, and compromised networks,” the FBI said in its statement. According to the FBI, the malware used in the attack communicated with known North Korean computers. The FBI didn’t furnish evidence to back its assertion that North Korea was involved. North Korea has denied being behind the hack.

Read more: The 7 most outrageous things we learned from the Sony hack

Bureau investigators have been working for weeks with Sony executives and private security experts to investigate the scale and origins of the attack. For Sony, the hack has been devastating: It crippled the studio’s infrastructure, leaked sensitive documents about tens of thousands of employees and contractors, embarrassed executives and resulted in the studio’s decision to pull, The Interview, a movie whose plot centers around the assassination of North Korean leader Kim Jong Un. The film incensed the North Korean government.

Read more: 4 things every single person can learn from the Sony hack

The FBI did not say whether the attack was coordinated from within North Korea or through allies outside the hermit kingdom. The FBI said it could only provide limited information to the public to protect its sources and methods.

President Barack Obama is expected to address the incident on Friday afternoon in a White House news conference. On Thursday, White House Press Secretary Josh Earnest said the administration was treating the incident as a “serious national security matter.”

White House officials have convened daily meetings to discuss the attack and to devise options for a “proportional response,” Earnest said, not ruling out an American counter-attack on North Korean systems.

“The FBI’s announcement that North Korea is responsible for the attack on Sony Pictures is confirmation of what we suspected to be the case: that cyber terrorists, bent on wreaking havoc, have violated a major company to steal personal information, company secrets and threaten the American public,” Chris Dodd, who heads the trade group Motion Picture Association of America, said in a statement. “It is a despicable, criminal act.”

See the full FBI statement:

Today, the FBI would like to provide an update on the status of our investigation into the cyber attack targeting Sony Pictures Entertainment (SPE). In late November, SPE confirmed that it was the victim of a cyber attack that destroyed systems and stole large quantities of personal and commercial data. A group calling itself the “Guardians of Peace” claimed responsibility for the attack and subsequently issued threats against SPE, its employees, and theaters that distribute its movies.

The FBI has determined that the intrusion into SPE’s network consisted of the deployment of destructive malware and the theft of proprietary information as well as employees’ personally identifiable information and confidential communications. The attacks also rendered thousands of SPE’s computers inoperable, forced SPE to take its entire computer network offline, and significantly disrupted the company’s business operations.

After discovering the intrusion into its network, SPE requested the FBI’s assistance. Since then, the FBI has been working closely with the company throughout the investigation. Sony has been a great partner in the investigation, and continues to work closely with the FBI. Sony reported this incident within hours, which is what the FBI hopes all companies will do when facing a cyber attack. Sony’s quick reporting facilitated the investigators’ ability to do their jobs, and ultimately to identify the source of these attacks.

As a result of our investigation, and in close collaboration with other U.S. Government departments and agencies, the FBI now has enough information to conclude that the North Korean government is responsible for these actions. While the need to protect sensitive sources and methods precludes us from sharing all of this information, our conclusion is based, in part, on the following:

· Technical analysis of the data deletion malware used in this attack revealed links to other malware that the FBI knows North Korean actors previously developed. For example, there were similarities in specific lines of code, encryption algorithms, data deletion methods, and compromised networks.

· The FBI also observed significant overlap between the infrastructure used in this attack and other malicious cyber activity the U.S. Government has previously linked directly to North Korea. For example, the FBI discovered that several Internet protocol (IP) addresses associated with known North Korean infrastructure communicated with IP addresses that were hardcoded into the data deletion malware used in this attack.

· Separately, the tools used in the SPE attack have similarities to a cyber attack in March of last year against South Korean banks and media outlets, which was carried out by North Korea.

We are deeply concerned about the destructive nature of this attack on a private sector entity and the ordinary citizens who worked there. Further, North Korea’s attack on SPE reaffirms that cyber threats pose one of the gravest national security dangers to the United States. Though the FBI has seen a wide variety and increasing number of cyber intrusions, the destructive nature of this attack, coupled with its coercive nature, sets it apart. North Korea’s actions were intended to inflict significant harm on a U.S. business and suppress the right of American citizens to express themselves. Such acts of intimidation fall outside the bounds of acceptable state behavior. The FBI takes seriously any attempt – whether through cyber-enabled means, threats of violence, or otherwise – to undermine the economic and social prosperity of our citizens.

The FBI stands ready to assist any U.S. company that is the victim of a destructive cyber attack or breach of confidential business information. Further, the FBI will continue to work closely with multiple departments and agencies as well as with domestic, foreign, and private sector partners who have played a critical role in our ability to trace this and other cyber threats to their source. Working together, the FBI will identify, pursue, and impose costs and consequences on individuals, groups, or nation states who use cyber means to threaten the United States or U.S. interests.

TIME Social Networking

This Is Why You Just Lost a Bunch of Instagram Followers

Instagram
The Instagram logo is displayed on a smartphone on December 20, 2012 in Paris. Lionel Bonaventure—AFP/Getty Images

Instagram eliminates millions of fake accounts in a matter of hours

Judgement Day came for millions of fake Instagram accounts this week in a crackdown so widespread it’s been dubbed the “Instagram Rapture.”

The mass drop in Instagram followers comes as the platform looks to rid itself of fake accounts, which some users purchase en masse to inflate their apparent follower count.

Instagram’s official profile took the biggest hit in followers, plummeting by 18.9 million accounts in a single day, according to data collected by Zach Allia, a web developer who created a handy graphic of the reckoning. Some of the most followed celebrities on Instagram took the next biggest hits. Justin Bieber, Kim Kardashian and Beyonce lost a following of 3.5 million, 1.3 million and 831,000 respectively. The rapper Mase woke up to find his 1.6 million followers had dwindled to 100,000, prompting him to delete his account for good, Business Insider reports.

An Instagram spokesperson told the New York Times that the company’s recently publicized tally of 300 million active monthly users excluded the fake accounts now being purged.

TIME apps

Picture This: Instagram Could Be Worth $35 Billion

The Instagram logo is displayed on a smartphone on Dec. 20, 2012 in Paris, France.
The Instagram logo is displayed on a smartphone on Dec. 20, 2012 in Paris, France. Lionel Bonaventure—AFP/Getty Images

Photo-sharing service owned by Facebook could be worth that whopping amount, according to a new estimate by a Wall Street analyst

Instagram, the photo-sharing service owned by Facebook, could be worth a whopping $35 billion, according to a new estimate by a Wall Street analyst.

Citi’s Mark May issued a new valuation estimate for the popular app, far above the bank’s prior $19 billion valuation, a loftier view on the asset that May attributed to Instagram’s announcement last week that it had reached more than 300 million total users.

“While Instagram is still early in monetizing its audience and data assets and its financial contribution to Facebook is minimal today, we believe that it is quickly gaining monetization traction and would contribute more than $2 billion in high-margin revenue at current user and engagement levels if fully monetized,” May wrote in a research report.

The sky-high valuation makes Facebook’s 2012 acquisition of Instagram look like a slam-dunk. The social-media giant only paid $1 billion for Instagram in a cash-and-stock deal.

And Facebook’s move to make money off Instagram is just getting started. Instagram began to roll out ads in its photo stream in late 2013, with video ads debuting on the platform roughly a year later. Citi’s May expects that 2015 will be the first year that Facebook begins to develop “more meaningful off-Facebook revenue streams,” and that includes efforts to make more money off Instagram.

Even with Instagram’s likely higher valuation, it is still a relatively small piece of Facebook, which is overall worth more than $220 billion. But the photo-sharing service’s new valuation estimate by Citi would suggest it is worth more than Twitter, which has fewer monthly active users and a market capitalization of almost $24 billion.

That valuation gap could potentially widen. May said that he expects Instagram could continue to rapidly add users and expects the gap in total viewers between Instagram and Twitter will continue to widen. By the end of 2015, May forecasted that Instagram could have 420 million users verses Twitter’s 319 million.

This article originally appeared on Fortune.com

TIME ebola

How Your Tablet Can Help Find an Ebola Cure

rbrb_2118
Photodisc—Getty Images

Anyone with a computer or Android smartphone can perform cutting edge research on the formidable virus

Mark McCaskill’s daughter is only 11 years old and so far knows only the most basic things about viruses and how they work. But she’s conducting pioneering biological experiments to find a treatment for Ebola. Or at least her Kindle is. When she’s not using it to listen to her favorite singers or watch the latest TV shows, her tablet is scanning thousands of chemical compounds, any one of which could turn out to neutralize, or even destroy Ebola and save thousands of lives.

That’s because her father, Mark, a transportation planning expert for Roanoke Valley in Virginia, signed up her Kindle, two of his own PCs and his mother’s computer to IBM’s World Community Grid (WCG), an innovative mass computing network that allows anyone to contribute in the fight against everything from brain cancer to polluted water and now, Ebola, by essentially offering to WCG their computer’s processing power when it’s not otherwise being used. Nearly 700,000 people have registered their Android phones or PCs on the WCG (the grid isn’t compatible with iOS yet, but IBM says it’s working on it).

“Some people volunteer in a traditional sense with Meals on Wheels. I think of this as my own personal form of volunteering, a new high tech way of volunteering,” says McCaskill.

There’s massive amounts of data out there that could prove revolutionary, but sifting through thousands—or millions—of compounds takes a whole lot of computing power. So every time McCaskill and his family members aren’t on their computers or tablet, their processing power is shunted to combing through the millions of compounds that exist in drug libraries that could be the answer to stopping Ebola in its tracks. Computational engineers call it “distributed computing,” but for the rest of us, it’s an opportunity to make like a world class biologist or immunologist or environmental scientist and indulge our inner science geek. In 1999, the team behind SETI, the Search for Extraterrestrial Intelligence, began using a similar strategy to analyze reams of radio signals from telescopes for possible extraterrestrial communications.

WCG essentially turns each device into a circuit in a massive virtual supercomputer. Each supercomputing task, such as vetting millions of chemical compounds for any potential activity against Ebola, is broken down into more manageable chunks and shunted to individual devices. The data, which is downloaded to the WCG in real time, is then collected, digitally ‘cleaned’ and delivered to the researcher like a birthday gift, neatly packaged and containing valuable and eagerly awaited information.

The idea for the WCG was born at IBM Foundation, when Stanley Litow, vice president of corporate citizenship and corporate affairs, began getting numerous requests from desperate scientists for IBM to donate supercomputers for their work. Declines in federal science grants meant that few institutes could afford the cost of a supercomputer at the same time that many of the most critical scientific projects—such as querying enormous databases of chemical compounds for potential cancer treatments and compounds that can fight emerging diseases like Ebola—required massive computing power. “We came to the conclusion that it would be possible to try to solve this problem with a virtual super computer using grid technology if we could get enough people to sign up to combine their computing power,” Litow says.

People were more than willing to chip in. More than 3 million devices from 680,000 donors are registered on the WCG. One of the grid’s projects, Help Fight Childhood Cancer, conducted 9 million virtual chemistry experiments in five years and found seven promising agents that are being studied to fight a common childhood brain cancer. The Clean Energy Project evaluated 100,000 molecular shapes of organic molecules to identify formations most suitable for becoming organic solar cells that may emerge as alternative sources of energy. And FightAIDS@Home was launched in 2005 and enlisted individual computers to collectively scan chemical compounds to find new drugs against HIV; it’s 90% complete. The Ebola project, which debuted on the grid the first week of December, completed in one week what it would have taken a PC with a single processor about 35 years to accomplish.

“My biologists cannot look at a million compounds, for one, and even if they could, we couldn’t afford to buy them all. And even if we could, there just isn’t enough time to screen them all,” says Erica Ollmann Saphire from the Scripps Research Institute who is scanning chemical databases for possible Ebola therapies.

Saphire has two Ebola-related projects that she’s hoping the network of devices out there will solve. In 2013, she and her team discovered that the wily Ebola virus actually existed in three different structural forms during its life cycle, changing from a holiday wreath structure to a zig-zagging matrix to a butterfly-like shape, each uniquely designed to optimize its journey from budding new virus to finding cells to infect and finally invading those cells. “It’s like having thread that can be yoga pants in the morning, unraveled and reknitted into a shirt for work, then unraveled and reknitted into slippers for the evening when you go home,” says Saphire.

But understanding how these three complex structures form, and what signals them to materialize at specific times, is a “really complex computational problem,” she says. “The level of complexity of the three entirely different structures is each so big that you can’t even say it might take hundreds of years for a computer to accomplish; it would just be impossible to accomplish since there are just too many atoms and too many variables,“ says Saphire.

But with thousands of people chipping away at a small part of the problem, the large, complex, nearly impossible problem becomes potentially manageable. At least that’s what Saphire and the scientists at IBM are hoping.

And people like McCaskill are happy to do their part. Has the heavy lifting for science put a dent in his computing power? Not at all, he says. Cyber security hasn’t been a concern since IBM monitors the grid and ensures that any private information on PCs isn’t accessed or downloaded. And his daughter hasn’t complained about the grid draining her battery power, since the Kindle is set up to do most of its computing while the device recharges at night.

“You don’t have to be in Silicon Valley, or some megalopolis, you can be in an area like we are, and be doing creative stuff and cutting edge research,” McCaskill says.

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