Barriers to Entry
The Chinese are at it again. Canadian Business Online reports that the Chinese government has now required Chinese banks to stop using foreign information security technology. You’ll find another good review of the regulation here at SiliconValley.com. The program is called Multi-Level Protection System (MLPS). From these early reports, it’s hard to tell whether the Chinese government is genuinely concerned with foreign government spying or if this is just another effort to protect their own technology sector. The articles did mention Cisco a lot, but I assumed that it’s because Huawei (a Chinese competitor) is getting deeply into the firewall business. I expect that we will know more as the full story is reported in the media.
Before anyone gets too worked up about this, let’s remember that this type of thing happens all the time and in every major nation on the planet. I personally remember conversations with several security pros in the U.S. government who described a quiet effort by a U.S. Security agency in the 1990s to curtail government use of a firewall technology built overseas. We all know that the French required that encryption technology sold in France include keys so that government agencies could decrypt all traffic. For a long time it was against the law to sell encryption technology in South Korea. It is also very similar to the dispute between RIM and the governments of Saudi Arabia, Dubai, and India, don’t you think?
In this country, we often require that companies providing technology to the government make that technology inside the USA. Our government also requires that U.S. banks use approved U.S. algorithms for encryption and data protection. Finally, we have the International Trafficking in Arms Regulation (ITAR), which restricts technology that can be exported to other nations. That’s been in place since 1976 and China was embargoed for a long time under ITAR.
And if we go back even earlier in the history of information security we could talk about the debate that raged around the crypto key length of the original Data Encryption Standard. At the time it was rumored that the key link had been shortened from 64 bits to 56 bits, simply because the NSA did not have the computing power to effectively decrypt messages with a 64 bit key. This is purely rumor, but I’m sure someone inside the People’s Republic is well acquainted with these restrictions on the use of security technology.
As they say: “What goes around, comes around.” So it’s reasonable to expect that the Chinese would also try some form of prohibition on the importation of security technology. I only hope that their leaders will look back on all of these prior efforts and realize that these kinds of trade barriers hurt competitiveness and technology adoption. I hope they will realize that general prohibitions are generally unproductive. Otherwise they may spend several years and several billion dollars, while their own suppliers make the mistakes and learn the lessons of this industry.
Jim Molini, CISSP, CSSLP
Let me start by saying that I was 