Mar 5, 2020

Axios Codebook

Axios

Maybe it was leap year, maybe it was news overload, but when we told you last week Codebook was taking a break, we were a week off — and so here we are once more in your inbox, with a special 1 big thing contribution from Axios' Erica Pandey.

After today we really are taking a brief break, before Codebook returns with some exciting changes. We'll miss you till then.

  • This week's Codebook is 1,630 words, a 6-minute read.
1 big thing: U.S. bans could make Huawei stronger

Illustration: Aïda Amer/Axios

The U.S.'s blunt policy of walling itself off from Huawei could backfire, making the Chinese telecom giant even stronger in the long term, Erica Pandey reports.

Why it matters: The grand decoupling of American and Chinese tech amid trade tensions and cybersecurity concerns, of which Huawei is at the center, is pushing China's companies to become increasingly self-reliant. Huawei's progress could position it to take the lead in the global U.S.-China tech race, experts say.

"We could end up ceding ground to global Chinese companies if the United States increasingly fences off access to its tech sector, isolating itself from where innovation is happening around the world," says Samm Sacks, an expert on China and cybersecurity at New America.

Driving the news: The Commerce Department barred American firms from selling to Huawei computer chips that are crucial to building base stations for its new 5G wireless networks — but the Chinese company is learning to live with the ban, Tim Danks, a U.S.-based Huawei executive, told Yahoo Finance.

  • Per Danks, Huawei sold 50,000 base stations that contain no U.S.-made technology in the fourth quarter of 2019.
  • Huawei still wants to go back to using U.S. tech, Danks told Yahoo Finance.
  • And, in the short term, the ban is hurting the American companies who supply Huawei with chips, too. "While it's impacted Huawei and nobody can say it hasn't impacted us to some degree … it's hurting Americans at this point more than it's hurting Huawei," Danks told Axios' Ina Fried at the RSA conference last month.

Yes, but: China had already begun a move toward tech independence long before the U.S. ban on Huawei, building expertise in chips and software to become less reliant on the West, and the U.S. in particular.

The big picture: As Huawei keeps building out networks, even without U.S. chips, it's making headway all over the globe — and bringing Beijing's vision for the internet with it. "We can blacklist companies in this country and wall them off, but they’re going to continue to gain ground in markets across Europe and Asia," Sacks says.

  • The U.K. has agreed to let Huawei build part of its 5G network, despite the U.S. urging against it. Switzerland has also welcomed the Chinese giant.
  • Those are just two of a slew of countries in Africa, Asia, Europe, South America and beyond that have partnered with Huawei.

What to watch: American companies are making strides in 5G, but have yet to provide the world with a compelling alternative to Huawei, says Sacks. Its chief competitors in the 5G market are Ericsson and Nokia.

Still, China has not secured a definitive lead, Jim Lewis, a fellow at the Center for Strategic and International Studies, said at a Senate hearing on Wednesday.

  • "The U.S. is well-positioned to take advantage of 5G technology, just as it did with 4G," Lewis said. "The difference this time is we have real competition, a competitor who is well-resourced, with a strong technology workforce, and a long record of unscrupulous behavior."
  • But to beat out Huawei, America must do more than cut the company off from U.S. technology and urge allies to reject it, Sacks says. "If we take this purely defensive posture, I don’t see how we advance."
2. Why lawmakers are targeting Huawei and TikTok

Illustration: Lazaro Gamio/Axios

Policymakers in D.C. are targeting Huawei and other Chinese-owned companies because they're trying to thread the needle between protecting U.S. security and avoiding wider disruption of the two nations' interdependent economies, Axios' Kyle Daly reports.

The big picture: A new wave of proposals in Congress is turning TikTok, Huawei and other specific companies into proxies in Washington's broader power struggle with Beijing.

What's new: Sen. Josh Hawley will soon introduce a bill to ban federal employees from using TikTok on government devices, he announced at a Wednesday hearing centered on Chinese technological threats.

  • During a separate Senate hearing Wednesday on 5G supply chain security, Sen. Roger Wicker said he expects a bill to help small telecom providers ditch Huawei equipment to be signed by President Trump "with some fanfare in the next few days."
  • "We face a major security threat from China. This includes our economic security, it includes our military security, and it certainly includes our cybersecurity and our own personal data security," Hawley said at his panel's hearing.

Yes, but: Breaking up with China isn't easy.

  • "The reality is, there's no decoupling from China in a macro sense. Our economies are tied together intimately because we rely on the supply of cheap goods from China," Jamil Jaffer, senior vice president at IronNet Cybersecurity and founder of George Mason University's National Security Institute, told Axios. "If we hurt one another, that's going to be painful for everyone."
  • Gear from Chinese companies like Huawei and drone maker DJI not only tend to be some of the cheapest on the market, but increasingly the products are top quality.
  • That's happened in part because Beijing has supported Chinese companies with cheap financing and direct cash infusions and by long sanctioning infringement of Western intellectual property that can then be built upon, Jaffer said.

Meanwhile: China's enormous middle class has become a major market for U.S. companies like Apple. China, like many other countries, also continues to rely heavily on the U.S. for software, hardware components and other tech.

  • Similarly, the supply chains of many U.S. and European device and equipment makers — including Huawei's global rivals in the 5G supply market, Nokia and Ericsson — extend back to China.
  • In comments to the Trump administration as it has ramped up tariffs on China, a host of U.S. companies have declared that the U.S. lacks the infrastructure, from machinery to labor force, to make goods across a wide range of industries.

Tech and telecom firms have become lawmakers' first stop in targeting China for three reasons:

  • They're potential security risks. There's no solid public evidence that companies like Huawei or DJI have been spying on Americans for Beijing. But many policymakers and cybersecurity experts argue that deploying their tech widely and opening even the theoretical possibility isn't worth the risk. Meanwhile, companies like TikTok could potentially be tapped for behavioral data to train AI systems.
  • They're among China's strongest growth sectors and are increasingly central to modern life. Efforts to cripple and isolate Chinese tech and telecom companies strike at the heart of the country's ability to overtake the U.S. in sheer global economic power.
  • They're guilty by association, in the public eye, with China's authoritarianism and surveillance-state tactics.

What's next: Coronavirus-driven supply chain disruptions may soon end up teaching American companies more about how to get along without Chinese counterparts than any congressional mandate.

3. How wrinkles in time mess with our systems

When the popular free-stock-trading app Robinhood went offline Monday and Tuesday, Twitter wags immediately opined that programmers must have failed to account for this year's quadrennial Leap Day, which fell on Saturday.

But it wasn't a bad guess. Calendar quirks have always been a predictable source of software bugs. We think of the measurement of time as a science, but it is also a human art, encrusted with customs, exceptions and historical quirks.

  • Time zones are irregular.
  • Times are a.m. and p.m. except when they're on a 24-hour clock.
  • Different countries format dates differently.
  • To remember how many days each month has, people need mnemonic rhymes!
  • Computers are great at keeping track of all these things, but the people who program them still make goofs trying to account for all of the cases.

Y2K: Two decades ago, a bug associated with the flip of the millennium counter threatened a Y2K doomsday that never materialized, whether because the danger had been overhyped or because freaked-out companies hauled enough COBOL programmers out of retirement to fix everything.

2038: Today, Unix programmers are already preparing for the "Year 2038 bug." Some versions of Unix will break in that year as the number of seconds that have passed since Unix time began in 1970 grows too big to hold in a 32-bit register.

Daylight savings time: The clock's seasonal adjustments used to cause many systems to throw fits. Modern systems handle them smoothly, for the most part — but every time the clocks move forward or back, the brains of your local sysadmins, IT crews, and tech-support teams ache from their old war wounds.

What's next: The U.S. moves its clocks forward this coming weekend. Everybody ready?

4. Book closes on Georgia governor's election hacking claim

Georgia closed an investigation into its governor's accusation that Democrats had hacked state voter registration systems, concluding there was no evidence to support the charge.

Catch up fast: Two days before the polls opened in the 2018 Georgia governor's race, Brian Kemp, then Georgia's secretary of state in charge of overseeing the election, made his explosive charge.

Kemp was also the Republican candidate for governor in the election he was overseeing. He went on to beat Democrat Stacey Abrams by a slim margin of a little over 1%.

Now, 16 months later, a state attorney's general investigation reports there was zero evidence for Kemp's charges, the Atlanta Journal-Constitution reports.

Democrats say the accusation was a lie intended to suppress votes. Kemp's office continues to refer to the incident as a "failed cyber intrusion."

One face-plant thing: The investigation reported that there was indeed an attempt at breaking into the state's election systems — by the Department of Homeland Security, which was asked to perform such tests by Kemp's office.

5. Odds and ends
  • Increasingly, the FBI is going after dark-web hacking operations wholesale rather than targeting individual bad actors, says director Christopher Wray. (AP)
  • When Facebook users see fact-checking labels on selected items of content, they don't value those items more highly — they just conclude that everything they're seeing on Facebook is more trustworthy, a new study finds. (Fast Company)
  • A growing malware trend on Android, diagnosed by a new McAfee study: hidden apps that exploit accessibility features. (Tech Republic)
  • Utah has contracted with AI startup Banjo for a massive predictive policing project culling data from traffic cameras and other devices. (Vice)
  • As part of a widespread bug fix, users of Let's Encrypt, the provider of SSL certificates, have to perform manual renewals. (Ars Technica)
  • The Cyberspace Solarium Commission's big report will drop on March 11. Here's a preview of its 75 recommendations. (The Hill)
  • A penetration tester tasked with challenging the security defenses at a South Dakota prison turned to an unusual co-conspirator: his mom. (Wired)
  • Behind the scenes of the Cryptolaemus group's war on Emotet malware. (ZDNet)
Axios

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