March 15 2007: 7:12 AM EDT

TAIPEI (Reuters) -- Skype, the Internet telephony service owned by eBay Inc., said Thursday that China recently passed the United States to become its biggest market by subscribers, as Asia takes on growing importance to its business.

http://money.cnn.com/2007/03/15/news/inter...oney_topstories

so? they ought to be more competitive in this market, surely there are some better providers outside, hope they can competitive with skype.

A group of researchers from the University of Toronto-based Monk Centre for International Studies have discovered a massive spy system infiltrating more than 1,200 computer systems world-wide, including those of the offices of the Dalai Lama.

Dubbed by the team that found it as "GhostNet", the system traces back to four servers - three of which are located in China, and one in Southern California.

The researchers who unearthed GhostNet had been asked by the office of the Dalai Lama to investigate whether their systems had been compromised by malicious software. What they uncovered was much larger than they could have suspected.

The spy operation has gained control of "at least 1,295 computers in 103 countries, including many belonging to embassies, foreign ministries and other government offices," reported The New York Times.

The malware is remarkable both for its sweep — in computer jargon, it has not been merely “phishing” for random consumers’ information, but “whaling” for particular important targets — and for its Big Brother-style capacities. It can, for example, turn on the camera and audio-recording functions of an infected computer, enabling monitors to see and hear what goes on in a room. The investigators say they do not know if this facet has been employed.


There has been no direct connection found between the spy network and the Chinese government, and the researchers admit that despite the majority of the servers tracing back to locations in China, it could just as easily be run by the CIA, the Russians, a for-profit 3rd party agency, or a group of Chinese "patriotic hackers".

What does seem clear is that information mined by GhostNet has come into the hands of the powers that be:

The electronic spy game has had at least some real-world impact, they said. For example, they said, after an e-mail invitation was sent by the Dalai Lama’s office to a foreign diplomat, the Chinese government made a call to the diplomat discouraging a visit. And a woman working for a group making Internet contacts between Tibetan exiles and Chinese citizens was stopped by Chinese intelligence officers on her way back to Tibet, shown transcripts of her online conversations and warned to stop her political activities.


For more information, check out the full report: "Tracking GhostNet: Investigating a Cyber Espionage Network." Incidentally, one member of the Munk Centre team that discovered GhostNet is Nart Villeneuve, whom also uncovered that the Chinese version of Skype was spying on its users - I don't know what we should give this guy first, an award or a bullet-proof vest.

I said as much in my blog http://quick.catchfriday.com/2009/02/22/tr...l-china-in.aspx

The Trillion Dollar spending package can go a lot further if you are paying a lot less for products, and China is just like a US State, with no minimum wage and red tape. Get China to replace Medicare, downsize the expenditure, and concentrate in the US on high upper end products and services.

If they're all like my wife, who has at least seven Skype accounts because she can never remember her password when she wants to use it, then we need to divide that 13 million by 7.



Forget that. Of much more immediate concern to Skype users is this:

Breaching Trust: An analysis of surveillance and security practices on China's TOM-Skype platform

The same group (the Monk Centre) las October reported discovering a massive security hole in TOM-Skype, the official Skype client in China, which allows the Chinese government to monitor, censor and archive all Skype communications in, into or out of the country.



According to the report, researchers at the Monk Centre accessed and downloaded millions of Skype communications, together with personally identifiable information such as IP addresses and phone numbers, stored on eight TOM servers in China. If you like Skype, that's fine. But if you're either in, or calling to, China, don't think the government's not watching you.

Two new announcements from Skype Portal Partners (Onet - Poland and TOMSkype in China) appear to confirm my thoughts about Skype becoming a Global Media Network player as apposed to a being a Global Telecom as Skype touts on their home page.
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news - my twitter profile

If I was using Skype in China I'd be on a Personal VPN outside of China to prevent this spying. I use this setup in the Middle East with great results and peace of mind.