The state of the computing industry

TOP STORY — info you need to make Windows work

The State of the Computing Industry

By Brian Livingston

I like to think back on the good old days, when the worst thing Windows might do to us was crash.

Now we have to defend ourselves against invisible programs that silently take over our PCs, record our keystrokes to capture our banking passwords, use our bandwidth to send out junk e-mails that can't be traced back to the senders, and then bury us in the spam we receive in turn from all the other PC users whose machines have been similarly hacked.

This week, Symantec, the antivirus and security company, released its sixth semiannual Internet Security Threat Report. It says the firm found a vast increase in the number of "bot networks" that are under the control of hackers. Each network consists of thousands of machines that have been infected with Trojan horses and are now controlled by criminals.

During the first six months of 2004, Symantec detected a rapid growth of bot networks from fewer then 2,000 to 30,000. The number of PCs in each network is said to average around 2,000. Multiply the number of networks by the average population of controlled machines and it works out to 60 million "zombie" PCs — that we know about.

Symantec found one bot network consisting of 400,000 zombies, according to an article by John Markoff in the New York Times. Each network can be used to broadcast spam, launch devastating denial-of-service attacks against Web sites the hackers don't like, and more.

What's going on here?

Is this it? Are we just going to face more and more attacks as our computer resources spiral more and more out of our control?

It seems to me that the computing industry is in denial of how bad the attacks on our PCs and our lives have become. Things aren't going to get better without radical changes to bring about a safe and sane computing environment. The first step is for us to stand back and survey just how bad the situation has become.

What follows, therefore, is my first State of the Computing Industry report — a quick and dirty overview of the maddening crisis that has engulfed us.

I focus in this report on four areas — viruses, spam, phishing, and adware — although an entire book could be written on all the problems that "making computers easier and more fun" has brought down on our heads. Here we go; I hope you're sitting down.

Viruses

Four and a half times more viruses and worms targeted Windows systems in the first half of 2004 than the same period of 2003, according to the Symantec report. That's 4,496 new viruses and worms this year so far. More info
About 1 in 12 e-mails carried viruses in the first six months of 2004 that are capable of penetrating firewalls meant to keep them out, according to an analysis of 5.6 billion e-mails by monitoring firm MessageLabs. Up-to-date antivirus programs are capable of stopping most such viruses at this point — but the viruses are growing stronger every month. More info
There are now 1,740 known, unpatched security flaws in Windows and other operating systems, according to statistics collected by US-CERT, a nonprofit security coordination center. That's more than a 300% increase over the 417 vulnerabilities that were known to researchers as recently as 1999. More info
Access to zombie-PC networks is being sold and traded among hackers for about 10 cents per compromised machine, according to reports in The Register, a British high-tech news site. More info

WINDOWS SECRETS NEWSLETTER
(formerly Woody's Windows Watch and Brian's Buzz on Windows)
Editors' Photo

ISSUE 38 — 2004.09.23

• Top Story: The State of the Computing Industry
• Recommended Reading
• Viewing a JPEG can infect your PC — unless you patch
• Microsoft Office converter flaw allows attacks
• First patch for XP SP2 fixes loopback addresses, VPN
• Special Report: How to pick the best online download service
• Two multifunction printers shine above the rest
• The best Webcams for today's video feeds
• The pick of the new crop of digital cameras
• The finest color laser/LCD printers
• Portable speakers that won't give you any static
• Which digital audio receiver beams out the best sound?
• Wacky Web Week
• Useful Links

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CIRCULATION: over 145,000

Spam

Spam exceeded 70% of all e-mail in July 2004, the highest rate ever detected by MessageLabs. It's over 80% of the e-mail received by Internet service providers AOL and MSN. That compares with the halcyon era when only 7% of all e-mail was spam, as measured by Brightmail as recently as April 2001. More info (click the "Spam" tab for statistics)
About 60% of all spam is now sent via zombie-infected machines, according to Spamhaus.org, a respected antispam service. Besides using their bot networks to send spam, spammers last year started directing their zombie armies to flood and disable the servers used by antispam groups. Four such antispam organizations were forced to shut down in 2003 alone due to these denial-of-service attacks. More info
A single U.S. ISP, Comcast.net, sends 700 million spam messages a day, out of a total of 800 million daily outgoing messages. This enormous spam outflow is generated by the large number of ISP users whose PCs have been hijacked by zombie software, Comcast network engineer Sean Lutner told News.com in May. More info
Almost 1/6 of all spam now conforms to SPF (Sender Policy Framework), according to an analysis by e-mail service provider MX Logic. SPF is an identification system that's been promoted since last year to prevent malicious people from "bouncing" junk e-mail onto innocent victims. The spammers have adopted the SPF system, to make their e-mail appear legitimate, much more quickly than respected corporations, only a small minority of which have implemented SPF to date. More info

Phishing

More than 1,974 unique phishing attacks were reported in July 2004. Phishing occurs when spammers send official-looking e-mails, posing as messages from a bank asking customers to "confirm" their accounts by entering their passwords. The spammers capture and use these passwords, which are dutifully provided by up to 5% of the victims who are contacted, according to Antiphishing.org, a coalition of financial institutions and major e-commerce sites. More info
Phishing attacks are growing at a rate of 50% PER MONTH, the group's figures indicate. Although we often hear that Web sites that collect password data for phishers are in Russia and other non-Western countries, 35% of phishing sites are actually located in the U.S. More info (PDF file)
Thirty percent of American consumers have experienced online identity theft, according to a survey by the Gartner Inc. consulting firm. Ninety percent of those cases occurred in the past year alone. More info

Adware

Adware is exploding on users' PCs, with security firm McAfee alone finding more than 14 million instances in March 2004, up from fewer than 2 million just last August. Adware is often called by other names, including spyware and malware. Since these categories overlap, I use instead the general term "adware," which I define as "programs that are installed on a user's PC for the financial benefit of a sponsor without the user's full knowledge and consent." Putting the approval language into a license agreement and then asking users to click OK on the entire license is not full knowledge and consent. More info
More than 20% of PCs tested by PCPitstop have active in memory one or more programs the company defines as "spyware." Such programs always reduce the performance of the affected machines but often have much more serious side-effects as well. (PCPitstop is an online service that diagnoses more than 1 million machines per month.) More info
In surveys, 74% of users whose PCs are running adware from Claria (formerly Gator) said they had no knowledge of it being installed. The figure is 87% for adware from WhenU. In papers filed for a court case in 2003, Gator executives said only 16% of their 27 million "users" were unaware of the presence of the program on their machines, according to an article published by Forbes Magazine. Even when such adware runs perfectly and doesn't negatively affect a PC's reliability, serious issues of privacy and security are raised. More info
In the worst cases, adware installs via "drive-by downloads," exploiting weaknesses in Internet Explorer that allow Web sites to run programs on users' PCs without them even clicking "OK." Programs downloaded in this way, as explained in Christian Wagner's spyware/adware/malware FAQ linked to at the end of this paragraph, can operate like the worst traditional viruses. The downloaded programs may install keylogging software to capture user passwords, send personal information back to a central server, and more. (The recent Service Pack 2 for Windows XP closes some but not all of the security flaws in Internet Explorer.) More info

You CAN and MUST protect yourself

Regular readers of the Windows Secrets Newsletter know that they can protect themselves from the above threats by maintaining what I call a "security baseline." Every PC and computer network should be running at least the following five protective measures:

1. A hardware firewall to keep hackers from accessing your PC from the Internet;

2. A software (or "personal") firewall to prevent any undetected Trojan horses from sending out your personal data or anything else;

3. An antivirus program that's set to constantly update its virus signatures to detect threats in e-mail messages and shared files;

4. An antispam program to reduce junk e-mail, which is a common method of delivering viruses into PCs; and

5. An antiadware program to remove adware and guard against its re-introduction into your PC in the future.

A special report on the security baseline, and a review that names the best products in each of the categories above, is in our June 3, 2004, issue.

What percentage of PC users do you think have all five of the above protections in place and working? How many consumers do you think even know that all of these five defenses are needed? Not many.

More importantly, how many computers that retailers sell to consumers have all five of the above protections installed and working when the PC goes out the door? My guess is, "Almost none" — and that's the problem in a nutshell.

Every high-tech seller seems to want someone else to be responsible for taking, and paying for, the security steps that will make PCs and the Internet safe to use. If computer professionals, manufacturers, and retailers won't give consumers PCs armed with a comprehensive security baseline, why do we think consumers will figure it out and do it themselves?

I'm sorry, but saying, "You shouldn't click any links you don't trust" isn't an acceptable response to the millions of people who've already been victimized by the insecurities that were designed into Windows and the Internet.

The industry's leaders must work together and pay the tab

I believe the responsibility to clean up this mess resides squarely on the shoulders of our computing giants — the Microsofts and AOLs of the world. They've made billions of dollars by selling people on Windows and the Internet. They're the only entities with the financial resources to take Windows and the Internet back from the scum who are now wreaking havoc.

The industry giants, of course, want someone else — consumers, corporations, the government — to pay to make computing safe again. But it's ridiculous to think that millions of private individuals, or, worst of all, the governments of the world, can handle this task.

The U.S. Congress would probably make the situation worse with new legislation, just as Congress unwittingly legalized opt-out spam in the U.S. when it passed the infamous CAN-SPAM Act in 2003. The bill bears numerous provisions that were lobbied for by the Direct Marketing Association, an advertising interest group that Microsoft is a member of.

Taking back the Internet will require drastic changes in Windows and the way the Internet itself works. I've previously editorialized about one such step, involving digital signatures to identify the source of e-mail, called Domain Keys. It's being promoted by Yahoo.com and other computing groups — but Microsoft and AOL, after promising to work together on such systems, now don't agree and are pushing their own, incompatible technologies.

Our industry's 600-pound gorillas may not be able to come together and agree on the solutions we need to restore basic safety and reliability to our computing lives. But if we don't at least demand that they do so, we'll watch the Internet slide further and further down the rat hole it's already in.

To send us more information about this, or to send us a tip on any other subject, visit WindowsSecrets.com/contact. You'll receive a gift certificate for a book, CD, or DVD of your choice if you send us a comment that we print.

(A portion of the above report was originally presented in a keynote address by Brian Livingston at the SMB Nation Conference in Seattle, Washington, on Sept. 10, 2004.)

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RECOMMENDED READING — our book reviews of tech topics

Cleaning Windows XP For Dummies
One of the most popular books we've ever reviewed is Degunking Windows, a Paraglyph work by Jeff Duntemann and Joli Ballew that shows how to speed up systems that have gradually slowed. Now comes "Cleaning Windows XP for Dummies," a book with a similar goal by Allen Wyatt. A prolific author who's written dozens of high-tech books, he says if you can brew coffee while XP is booting up, it's time for the techniques he describes. His new effort even includes tips on how to optimize XP's Service Pack 2, which just came out last month. More info: United States / Canada / Elsewhere

book cover

Microsoft Office OneNote 2003 Step by Step
We ran a full description by Paul Thurrott in our Aug. 5 newsletter about the latest version of Microsoft OneNote, which makes this a good time for interested persons to check out books on the subject. This Microsoft Press offering (photo, left) walks you through the official story on the product in a relatively bite-sized 240 pages. OneNote's strengths include the ability for you to handwrite or type notes while you're making an audio or video recording, and then click a note to jump instantly to any point in the recording you wish. It's a handy tool, and one that gets too little notice among Microsoft's other products, we feel. More info: United States / Canada / Elsewhere

book cover

Microsoft Office Document Designer
Everyone has seen Word documents, Excel spreadsheets, and PowerPoint slides that have impressive features or special effects. But who has time to learn how to make all that work for themselves? Now a Microsoft Office consultant, Stephanie Krieger, has made a guidebook that puts these tools right into your hands. A CD-ROM in the back of the book includes numerous designs, layouts, and toolbars to get you started. More info: United States / Canada / Elsewhere

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HERE'S A TIP — you'll get a better newsletter if you choose the paid version

You're reading the free version of the Windows Secrets Newsletter
Subscribers to the paid version receive additional information in each issue. Some of the extras this week are:

Viewing a JPEG can infect your PC — unless you patch. In an outrageous security hole that Microsoft's "Trustworthy Computing" project completely missed, merely viewing a JPEG image file in Windows XP, 2003, Office XP/2003, or any number of other Microsoft and third-party programs can give control of your PC to a Trojan horse. There's a patch, and we show you when it's needed, as well as an alternate protection method.
Microsoft Office converter flaw allows attacks. Don't open another external file in Microsoft Word until you read how to protect yourself from this new exploit.
First patch for XP SP2 fixes loopback addresses, VPN. The first official patch for XP's Service Pack 2 is out. It prevents a problem that affects virtual private networks, among other things.
SPECIAL REPORT: How to pick the best online download service. With the release of Microsoft's Windows Media Player 10, there's a healthy competition in online digital media services. We review them all and tell you which one is best. Hint: It ain't Apple's or Microsoft's.
Two multifunction printers shine above the rest. In an extensive review of desktop devices that can print, copy, scan, and fax, two stood out, and they aren't the most expensive models, either.
The best Webcams for today's video feeds. Think all Webcams are the same? Think again. Of the numerous models that were tested, they all were somewhat similar in ideal lighting but quickly fell apart in less-than-perfect conditions — except for the one winning model.
The pick of the new crop of digital cameras. In a massive review of 20 of the latest cameras, five entirely separate categories of products emerged, and there are clearly superior models in each niche.
The finest color laser/LCD printers. Color laser printers are somewhat expensive. That's a good reason for you to know which ones came out on top in a torture test run by some very demanding reviewers.
Portable speakers that won't give you any static. In the race to augment your laptop's sound capabilities, the most expensive portable speakers didn't come out winners, while a less-expensive model clearly rose to the top of the ratings.
Which digital audio receiver beams out the best sound? When you need to get a signal from here to there without stringing more wires, reviewers found that all the available devices are not created equal.

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ELECTRONIC BOOKSHELF — new e-books from the editors

Spam-Proof Your E-Mail Address
This 27-page e-book by Brian Livingston gives you step-by-step instructions that can eliminate 97% of the spam that would otherwise clog your e-mail account. You could call it "Livingston's Spam Secrets." The PDF-format e-book is the result of months of experiments and tests we conducted. We now receive little or no spam to the addresses we used as guinea pigs. These tests show that you can actually reduce your volume of spam to practically nothing, not just battle an unstoppable and ever-growing flood. The methods we describe work with Windows, Apple, and Linux and don't require any filters or block lists — but you can use those in addition to the book's techniques, if you wish. More info

WACKY WEB WEEK — playing for you the Internet's greatest bits

For that special someone — enormous germs
It's a little late for Valentine's Day and too early for Christmas. But it's just the right time to be thinking about which of your loved ones you could give stuffed animals that look like disease-causing microbes — enlarged one million times.

The site of toymaker Giant Microbes says it now has available "The Common Cold, The Flu, Sore Throat, Stomach Ache, Cough, Ear Ache, Bad Breath, Kissing Disease, Athlete's Foot, Ulcer, Martian Life, Beer & Bread, Black Death, Ebola, Flesh Eating, Sleeping Sickness, Dust Mite, Bed Bug, and Bookworm (and in our Professional line: H.I.V. and Hepatitis)." How sweet. We're making our list and checking it twice. More info

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USEFUL LINKS — more stuff that's good to know

Here's where your e-mail went
Could the basic deliverability of the e-mail system we've come to rely upon be so bad as to lose more than 1 percent of all the messages we send? Two experts say that's pretty much how unreliable some e-mail providers are. (By Brian Livingston, Datamation) More info

New attacks and defenses in click-fraud war
Just as antivirus and antispam vendors must constantly upgrade their products to detect new kinds of attacks, an escalating battle of software is raging against the scourge of online advertising — click fraud. (By Brian Livingston, Datamation) More info

How the road to Windows Longhorn has changed
No Microsoft product has ever been delayed as much as Longhorn, as its ship date slipped from 2004 to 2005 to 2006 and even, according to some rumors, to 2007. As we now know, some dramatic decisions have been made to get Longhorn moving. Here's the inside story. (By Paul Thurrott, SuperSite for Windows, updated Sept. 17) More info

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The Windows Secrets Newsletter (formerly Woody's Windows Watch and Brian's Buzz on Windows) is published twice a month, except for breaks in August and December. The newsletter is published on the Thursday one week before and one week after Microsoft releases its new Windows patches on the 2nd Tuesday of each month.

Publisher: The newsletter publisher is WindowsSecrets.com LLC, 300 Queen Anne Ave. N. #456, Seattle, WA 98109 USA. Vendors, please send no unsolicited packages to this address (readers' letters are fine).

Editor: Brian Livingston is the co-author of Windows 2000 Secrets, Windows Me Secrets, and eight other books. Associate Editor: Paul Thurrott is the author of Windows XP Home Networking and Great Digital Media with Windows XP and the author or co-author of several other books. Research Director: Vickie Stevens. Program Consultant: Ben Livingston (no relation to Brian).

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