IRS Reducing Size Of Cybersecurity Staff

The Internal Revenue Service, which confirmed rumors of a breach of 100,000 taxpayer accounts, has been consistently reducing the size of its internal cybersecurity staff as it increases its security spending. This may seem paradoxical, but one observer suggested it could signal a shift to outsourcing.

In 2011, the IRS employed 410 people in its cybersecurity organization, but by 2014 the headcount had fallen by 11% to 363 people, according to annual reports about IRS information technology spending by the U.S. Treasury Department Inspector General.

Despite this staff reduction, the IRS has increased spending in its cybersecurity organization. In 2012, the IRS earmarked $129 million for cybersecurity, which rose to $141.5 million last year, an increase of approximately 9.7%.

This increase in spending, coupled with the reduction in headcount, is an indicator of outsourcing, said Alan Paller, director of research at the SANS Institute. Paller sees risks in that strategy.

“Each organization moves at a different pace toward a point at which they have outsourced so much that the insiders do little more than manage contracts, and lose their technical expertise and ability to manage technical contractors effectively,” said Paller.

An IRS spokesman was not able to immediately answer questions about the IRS’s cybersecurity spending.

This breach is drawing congressional scrutiny. On Tuesday, U.S. Senator Orrin Hatch (R-Utah), who heads the Senate Finance Committee, called the breach “unacceptable.”

The IRS’s total IT budget in 2014 was $2.5 billion, an increase from the prior year’s $2.3 billion, with 7,339 employees last year, little change from 7,303 reported in 2013.

The agency’s IT budget has fared better than the agency overall. Congress has been cutting spending at the agency. IRS funding has been reduced by $1.2 billion over the last five years, from $12.1 billion in 2010 to $10.9 billion this year. An IRS official told lawmakers earlier this year that the budget cuts have delayed critical IT investments of more than $200 million, which includes replacing aging IT systems.

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FCC To Tighten Rules On Robocalls

The top U.S. telecommunications regulator wants to make it more difficult for telemarketers and other businesses to robocall and text messages consumers under changes to autodialing rules being proposed.

The Federal Communications Commission plans to vote on June 18 on the proposal, which would give legal cover to telephone companies to offer consumers technologies that would block robocalls, regardless of where they originate.

“The FCC wants to make it clear: Telephone companies can – and in fact should – offer consumers robocall-blocking tools,” FCC Chairman Tom Wheeler said in a blog post.

The wireless carriers have worried that blocking automated calls could be construed as violations of the law that requires them to ensure that all calls placed over their networks reach their intended recipients.

The proposal would also reassert that consumers have to agree to receive automated calls and texts and clarify that they can revoke their consent in any “reasonable” way, including a simple request for calls to stop, without the need to file convoluted paperwork.

Robocalls and robotexts are by far the most common cause of consumer complaints at the FCC, topping 215,000 in the last year alone. Consumer advocates and the majority of U.S. states attorneys general had pressed the FCC to clarify the robocall rules.

Numerous business associations, including the U.S. Chamber of Commerce, have also pushed for clarifications, facing a growing number of lawsuits prompted by violations such as calling cellphone users whose numbers used to belong to someone else.

The FCC’s proposal would reassert that companies should try to avoid numbers reassigned to consumers who have not agreed to receive their calls. If they do not know that a number has been reassigned, they are allowed one call to find out.

The business community had also complained that some lawsuits unfairly target them for using dialing technologies that could be modified to become autodialers. FCC officials said any technology with the capacity to dial random or sequential numbers qualifies as an autodialer, even if it would require modification.

U.S. law prohibits telemarketing calls to both landline and cellphones of consumers who have not given written consent.

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Sharp Pinning Hopes On In-car Displays

Struggling display manufacturer Sharp, reeling from cutthroat competition in mobile phones, will push car makers to incorporate vehicle dashboards that have gestural commands, thin bezels and other next-generation features.

It’s hoping cars will be controlled, in part, through high-resolution displays that can fit any two-dimensional surface area, such as dashboard panels with rounded contours.

The company has shown off the wavy screens for cars and consoles in recent months, and has tried to woo automakers to use them. Under the firm’s new medium-term strategy, the push has taken on greater urgency.

Thin-bezel dashboard LCDs, as well as screens that can provide multiple views to different passengers in a car depending on their perspective, could prove to be a lifeline for Sharp, which hasn’t been able to command a dominant market position despite cutting-edge technology.

Sharp is an Apple supplier and is said to be a maker of iPhone 6 screens, along with Japan Display, and LG Display of South Korea.

Apple sources some of its screens from Sharp’s Kameyama plants in central Japan, which produce the maker’s flagship IGZO (indium gallium zinc oxide) transparent crystalline semiconductor displays. IGZO displays, which Sharp began producing for smartphones in 2013, have smaller pixels than conventional LCD screens and feature low power consumption.

Last month, Sharp showed off a 5.5-inch display with 3860 x 2160 or 4K pixel resolution, which was part of a 12.5-inch IGZO panel. But there were no immediate plans for mass production.

Sharp’s ability to generate dazzling phone graphics hasn’t saved its bottom line. The firm announced a US$1.7 billion bailout from banks this week, its second lifeline in three years, and posted a dismal earnings performance for the year to March 31 with a net loss of ¥222.3 billion ($1.8 billion). It blamed declining prices in small and medium-sized LCDs.

In contrast, Sharp sees prices for automotive and industrial automation displays as more stable because the barriers to market entry are higher due to the technological know-how that’s required. Now it needs to play for time.

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Is The DRAM Market Gaining Traction?

DRAM market conditions will be better in the third quarter of 2015, recovering from the bad first half of the year, according to Inotera.

Inotera chairman Charles Kau said that it was unclear if DRAM prices will stop falling and rebound in the third quarter.

Inotera on May 11 signed a $508 million five-year syndicated loan agreement with a consortium of local banks in Taiwan in the hope of getting a bit of flexibility until things pick up.
The outfit was not thinking of flogging any of the family silver, but plans to start distributing dividends to shareholders in 2016, Kau noted.

In 2014, non-PC DRAM products accounted for 60 per cent of Inotera’s total revenues. The company will continue to improve its product mix in 2015, while making progress in the transition to 20nm process technology.

Kau told Digitimes that Inotera http://www.digitimes.com/news/a20150512PD219.html plans to have 80 per cent of its total production capacity to be built using a newer 20nm node by the end of 2015.

Meanwhile it is not planning any big capital expenditure, he said.

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FitBit Files IPO As Sales Double

Fitbit, the maker of wearable activity trackers, has filed to go public and has reported some strong sales numbers in its presenation.

The company seeks to raise as much as US$100 million, according to a regulatory filing, though the amount is subject to change. Fitbit plans to list its stock on the New York Stock Exchange under the symbol “FIT.”

The filing reveals what seems to be a healthy business. The company sold roughly 10.9 million devices in 2014,more than double what it sold in 2013 and more than eight times as many as it sold in 2012.

Fitbit also more than doubled its revenue between 2013 and 2014, to more than $745 million. Sales in 2012 were about $76 million.

The company posted net income of nearly $132 million in 2014, up from a loss of roughly $52 million the year before.

Meanwhile, the company’s paid active users grew from 2.6 million in 2013 to 6.7 million in 2014.

Fitbit, founded in 2007, makes a number of activity-measuring bracelets and trackers that can be synced with an online dashboard and mobile apps. The company also provides premium services like virtual coaching and customized fitness plans.

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Intel Rewards RealSense Developers

Intel has awarded  $1m to a number of developers as part of its RealSense 3D App Challenge, which was launched last year.

Announced by Intel president Renee James at Computex 2014, the RealSense App Challenge was part of Intel’s efforts to boost RealSense globally and generate software innovation around the ecosystem.

More than 7,000 software creators in 37 countries applied to compete, and 400 were selected to develop new applications for entertainment, learning and collaboration.

Several hundred developers of creative app ideas in these categories received the latest edition of the RealSense 3D Camera and RealSense software development kit, which included free tools, examples and application programing interfaces with which to develop their ideas.

Intel announced on Thursday that the grand prize winner, who picks up $100,000, is Brazilian developer Alexandre Ribeiro da Silva of Anima Games.

His Seed app requires gamers to use reflexes and rational thinking to solve puzzles. The goal of the game is to guide a little floating seed through its journey to reforest a devastated land.

The second prize of $50,000 was awarded to Canadian developer David Schnare of Kinetisense. His OrthoSense app uses RealSense to help medical professionals remotely rehabilitate a patient who has suffered a hand injury by tracking their range of movement over time.

“This practical application of human-computer interaction is an impressive example of how technology can make our lives better,” Intel said.

Another notable winner was Lee Bamber from the UK, who received recognition for his virtual 3D video maker. The app allows a user to record themselves as a 3D hologram and then transport to a variety of scenes.

Once recorded, they can then change the camera position over the course of the playback to add an extra dimension to a video blogs, storybook or v-mails, for instance.

“The idea of the app is that you can choose the backdrop then set the lighting as you would in a studio then do the acting,” Bamber explained in his video.

Doug Fisher, SVP and general manager of Intel’s Software and Services Group, said in a blog post that now the app challenge is complete “the real work begins”, as Intel Software will continue to encourage all finalists to bring products to market.

“We also will continue mobilising our resources to inspire, educate and advance innovation through programmes such as the Intel Developer Zone, where developers can engage to find new software tools and build industry relationships,” he said.

“Human-computer interactions will no longer be defined by mice, keyboards and 2D displays. Our physical and digital worlds are coming together. When they do, the opportunities for us as consumers and businesses will explode.”

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USAA Exploring Bitcoins

USAA, a San Antonio, Texas-based financial institution serving current and former members of the military, is researching the underlying technology behind the digital currency bitcoin to help make its operations more efficient, a company executive said.

Alex Marquez, managing director of corporate development at USAA, said in an interview that the company and its banking, insurance, and investment management subsidiaries hoped the “blockchain” technology could help decentralize its operations such as the back office.

He said USAA had a large team researching the potential of the blockchain, an open ledger of a digital currency’s transactions, viewed as bitcoin’s main technological innovation. It lets users make payments anonymously, instantly, and without government regulation.

The blockchain ledger is accessible to all users of bitcoin, a virtual currency created through a computer “mining” process that uses millions of calculations. Bitcoin has no ties to a central bank and is viewed as an alternative to paying for goods and services with credit cards.

“We have serious interest in the blockchain and we think the technology would have an impact on the organization,” said Marquez. “The fact that we have such a large group of people working on this shows how serious we are about the potential of this technology.”

USAA, which provides banking, insurance and other products to 10.7 million current or former members of the military, owns and manages assets of about $213 billion.

Marquez said USAA had no plans to dabble in the bitcoin as a currency. Its foray into the blockchain reflects a trend among banking institutions trying to integrate bitcoin technology into their systems. BNY Mellon and UBS have announced initiatives to explore the blockchain technology.

Most large banks are testing the blockchain internally, said David Johnston, managing director at Dapps Venture Fund in San Antonio, Texas. “All of the banks are going through that process of trying to understand how this technology is going to evolve.”

“I would say that by the end of the year, most will have solidified a blockchain technology strategy, how the bank is going to implement and how it will move the technology forward.”

USAA is still in early stages of its research and has yet to identify how it will implement the technology.

In January this year, USAA invested in Coinbase, the biggest bitcoin company, which runs a host of services, including an exchange and a wallet, which is how bitcoins are stored by users online.

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Text To 911 Has Low Adoption Rate

Only 5% of the nation’s 6,500 emergency dispatch centers are capable of receiving and responding to emergency text-to-911 messages.

That’s not good enough for more than 41,000 signers of a Change.org petition. They want Congress to pass legislation requiring emergency centers to update their systems to accommodate texting.

Text-to-911 would have provided much-needed help for Lisbeth (not her real name), a mother of two who said she was repeatedly battered by her boyfriend in her home over several years. One day three years ago, when he was yelling at her, she tried to call 911 on her cell phone for help, but he broke down the door where she was hiding and demanded to know whom she was calling.

“I was trying to whisper, but he got in and punched me and asked me who I was talking to,” Lisbeth said in an interview. That time, a neighbor overheard the fight and called 911 to bring police to the scene.

“911 works, but I wish it worked with text,” she added. “If they had it back then, it might have made a difference.” Lisbeth later moved into a shelter for abused women in California’s San Fernando Valley and said her life has improved for herself and her children. “Anybody who is going through the same situation as I was should ask for help,” she said.

The Federal Communications Commission last yea rrequired U.S. carriers and makers of some texting apps to provide emergency texting with their services, but the FCC doesn’t regulate the nation’s emergency dispatch centers. Instead, the centers are regulated locally by 3,200 different states, counties and cities, even though many of those jurisdictions receive federal funds for the dispatch centers.

FCC Commissioner Ajit Pai last August expressed concerns that FCC mandates for carriers might give the public a false impression that they can send texts to emergency responders when so few are prepared to receive texts.

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RadioShack Plans To Sell Customer Data

RadioShack plans to keep moving forward with its plan to sell its customer data, despite opposition from a number of states.

The company has asked a bankruptcy court for approval for a second auction of its assets, which includes the consumer data.

The state of Texas, which is leading the action by the states, opposed the sale of personally identifiable information (PII), citing the online and in-store privacy policies of the bankrupt consumer electronics retailer.

The state claimed that it found from a RadioShack deposition that the personal information of 117 million customers could be involved. But it learned later from testimony in court that the number of customer files offered for sale might be reduced to around 67 million.

In the first round of the sale, RadioShack sold about 1,700 stores to hedge fund Standard General, which entered into an agreement to set up 1,435 of these as co-branded stores with wireless operator Sprint. Some other assets were also sold in the auction.

The sale of customer data, including PII, was withdrawn from the previous auction, though RadioShack did not rule out that it could be put up for sale at a later date.

The case could have privacy implications for the tech industry as it could set a precedent, for example, for large Internet companies holding consumer data, if they happen to go bankrupt.

Texas has asked the U.S. Bankruptcy Court for the District of Delaware for a case management order to ensure that in any motion for sale of the PII, RadioShack should be required to provide information on the kind of personal data that is up for sale and the number of customers that will be affected.

On Monday, Texas asked the court that its motion be heard ahead of RadioShack’s motion for approval to auction more assets.

The court had ordered in March the appointment of a consumer privacy ombudsman in connection with the potential sale of the consumer data including PII. RadioShack said in a filing Friday that it intends to continue working with the ombudsman and the states with regard to any potential sale of PII, but did not provide details.

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LinkedIn Acquires Startup Refresh

In a move that could produce even more automated suggestions and tips for LinkedIn users, the professional network has purchased California startup Refresh, the maker of an app that gathers news and insights about participants in meetings.

Launched three years ago, Refresh is designed to be a “digital briefing book” that can call up online information related to people that users are scheduled to meet. The information can be anything from blog posts, news articles or Facebook posts to personal notes or favorite sports teams.

The Refresh mobile and desktop app is aimed at helping people relate to one another more quickly, but it can also be used to refresh one’s memory when running into acquaintances unexpectedly.

The details of the deal were not disclosed. Refresh has stopped taking on new users and its app will shut down April 15.

“Refresh has surfaced insights associated with hundreds of millions of meetings, and has been central to countless connections and closed deals,” co-founder Bhavin Shah wrote on the Refresh blog in announcing the deal.

LinkedIn already has an app called Connected that was somewhat of a rival to Refresh. It can log the people users have met and offer updates and information about interests shared with “connections,” which are acquaintances in the LinkedIn lingo. It’s unclear whether Refresh features will be added to Connected or the LinkedIn website itself.

“Our team will focus its efforts on providing LinkedIn members with more insights to help them better do their jobs,” Shah wrote.

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