Clipper Costing / NSA ATM Crypto Venture

[NetSurfer <jdwilson@gold.chem.hawaii.edu>]

         CP's, here's a couple of tidbits to get the juices flowing.  
         They are from Infosecurity News July/August 1994 issue, page 
         10.  The ATM part is particularly interesting...
         
         "Clipper Debate Rages Onnnn..." by Charlotte Adams
         
         Controversy continues to escalate over the government's
         Clipper escrowed-key proposal.  Attacks include an analysis 
         of just how much taxpayers would have to pay for it, and a 
         Freedom-of-Information-Act request to hand over Clipper's 
         escrowed keys.  Meanwhile, the federal government continues 
         to backpedal, saying that Clipper will not be mandatory, 
         even for government users.
         
         What cost Clipper?  To gauge Clipper's economic impact on
         taxpayers, Steve Walker, president of Trusted Information 
         Systems Inc., offers the following analysis.         
         
         Approximately 5,000 legally authorized wiretaps take 
         place each year, based on a reported total of 800.  
         He increased this reported figure to 1,000, for argument's 
         sake, and multiplied by five to account for multiphone 
         wiretaps.) There are approximately 500 million phones in 
         the U.S., so the ratio of taps to the total number of phones is
         about O.001 percent.
         
         If the government taps 0.001 percent of AT&T's estimated market
         of 250,000 Clipper-equipped telephones, that works out to 2.5 
         key-escrow taps per year. Since the cost to run the country's 
         two planned key-escrow centers is estimated at about $6 million 
         per year, Clipper taps could cost taxpayers $2.4 million apiece 
         (beyond the $250 million to buy the Clipper-equipped phones at 
         $1,000 apiece in the first place).  But if the number of Clip
         per phones sold is 100-fold greater than AT&T estimates--25 
         million devices--there would still be only 250 escrow
         taps per year and one call to key-escrow centers every 1.5 days,
         Walker figures. Each approved Clipper tap, under these cir-
         cumstances, would cost $24,000.
         Now, add to these escrowed-tap approval costs the estimated 
         $50,000 to $60,000 that would be required to actually set up
         each wiretap.
         More than 1,000 Clipper crypto devices have been sold
         commercially since the products became available late last year,
         Department of Justice officials said. So far, the government has
         purchased another 9,000.
         
         Stalling tactics.  A response to the Freedom-of-Information-
         Act (FOIA) request for Clipper's keys filed by Electronic Frontier
         Foundation cofounder, John Gilmore, is slow in coming. According to 
         Gilmore's lawyer, Lee Tien, the FOIA applications--to the 
         Department of the Treasury and Department of Commerce
         --have only generated requests for more time. The agencies,
         however, "seem to be making an effort to respond," Tien adds.
         
         Now, it's voluntary.  Government witnesses testifying before
         back-to-back congressional hearings in May stressed the voluntary 
         nature of key-escrow technology for both government and
         commercial use. But others demanded more than executive-branch 
         reassurances.
         
         Raymond Kammer, deputy director of the National Institute
         of Standards and Technology, told a House Science, Space and
         Technology panel that he hopes government use will drive prices
         down far enough to make Clipper phones attractive to the public. 
         Citizens may also wish to buy Clipper-equipped phones for 
         communicating with government agencies, he added.

         Among Clipper critics, David Farber, professor of
         telecommunication systems at the University of Pennsylvania,
         told the House subcommittee that Congress needs to "weld
         into law" guarantees that Clipper will not be mandatory. And
         Trusted Information Systems' Walker told an earlier hearing
         before the SenateJudiciary Subcommittee on Technology and
         the Law that the administration should not "proceed on its own
         without separation of powers." He suggested putting key-es-
         crow centers under the judiciary branch, so that the executive
         branch "can't twist arms."
         
         ---------------------------------------------------------------
         
         NSA Launches ATM Encryption.  
         
         Trying to stay in step with rapidly evolving telecommuncations
         technology, the National Security Agency has kicked off an
         Asynchronous Transfer Mode (ATM) encryption program to provide
         end-to-end encoding across synchronous optical network (SONET)
         systems.  Called Fastlane, the ATM project specifies optical-
         channel  (OC) rates, with OC12 desired.  The work will parallel
         a SONET encryptor development program awarded to Motorola earlier
         this year.
         
         ---------------------------------------------------------------
         
         Disclaimer:  these articles were scanned, not forwarded <hehehe>
        
-NetSurfer

#include standard.disclaimer

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==  =    = |James D. Wilson        |V.PGP 2.4:   512/E12FCD 1994/03/17 >
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