Another IT systems failure at RBS
PDF Print E-mail

RBS appears to have been having a remarkable run of high-profile core-system failures, but I suspect that it has been rather unlucky or at least everyone else has been lucky. Ross McEwan, the new chief executive of RBS admitted to us in a canned statement that "decades of under-investment in IT systems" is to blame.

Decades seems to be an awful long time, but may well be accurate; certainly when I started working in IT 25 ago, the rot had already set in. For example, a retail bank where I once worked had its core standing order system written in pounds, shillings and pence with a translation routine sitting on top of it – yet many of these systems were supposed to have been rewritten as part of the millennium-bug investigations.

Never mind... pass me the sticky tape

However, most of this didn’t happen. Whole-scale rewrites of systems that were decades old – when only a few people understood how they worked – were simply not a great investment... It seemed companies were satisfied with just patching it up and moving on.

RBS is not going to be the only large company sitting on a huge liability in the form of legacy applications; pretty much all of the banks do as well as many others in other industries. Applications have been moved from one generation of mainframe to the next and they still generally work, but the people who know how they really work are long gone.

Yet this is no longer constrained to mainframe operations; many of us can point at applications running on kit which is 10 years or more old on long-deprecated operating-systems. Just talk to your friendly DBA about how many applications are still dependent on Oracle 8 and in some cases even earlier databases. Every data centre has an application sitting in the corner doing something no one quite understands... and no one wants to turn it off just in case.

Faced with ever-declining IT budgets – either by way of a real decline or being expected to do more with the same amount – legacy applications are getting left behind. Yes, we come across attempts to encapsulate the application in a VM and run it on the latest hardware, but it still does not fix the legacy issue.

If it ain’t broke, don’t fix it ... but the thing is, most software is broken – it's just that you’ve just not yet come across the condition that breaks it. Now the condition that breaks it may well be the untrained operator who does not know the cunning work-around to keep an application running; work-arounds simply should not become standard operating procedure.

Question is as we chase the new world of dynamic operations with applications churning every day: who is brave enough to argue for budget to go back and fix those things which aren’t broken. Who is going to be brave enough to argue for budget to properly decommission legacy systems, you know those systems who only have one user who happens to have a C at the beginning of their job title. website goes offline
PDF Print E-mail has become the latest high-profile website to go offline in recent days.

Visitors to the US shopping site were greeted with a message saying: "Oops! We're very sorry," alongside a "500 Service Unavailable Error" report.

The site returned online about half an hour after the problem was first flagged by users of the news site Reddit.

Amazon could not be reached for comment at this time.

The firm's UK site was not affected by the issue, however its Canadian home page also showed an error message.

Amazon's US site warned visitors of the problem

The support section of Intel's website and some pages which are only accessible to the computer chip-maker's staff also became unavailable for a period on Monday. A spokeswoman said this was due to an "internal issue" and it was a coincidence that it had occurred shortly after Amazon's problem.

It follows Google's two-minute downtime on Friday. That affected the firm's main search page as well as its Gmail email service, YouTube video site and Drive storage product.

Analytics firm GoSquared reported the fault caused a 40% dip in worldwide internet traffic. Google has not explained the cause.

Microsoft's and the New York Times website have also faced problems

Microsoft blamed a three-day-long disruption to its email product on a failure in its "caching" temporary storage service. It said this "resulted in a flood of traffic that our services did not handle properly".

Intel support page Parts of Intel's website have also faced problems

The New York Times has said that an "internal issue" with its servers meant that the newspaper became unavailable for two hours on Wednesday.

"It's very unusual to see such a number of high-profile websites all suffering peak-time outages within the course of a few days of each other," said Chris Green, principal technology analyst at the Davies Murphy Group consultancy.

"People are going to be very interested to know exactly what the reasons were for the incidents that are still unexplained because the implications are huge: we've seen everything from users being unable to see their email to visitors and third-party retailers who use Amazon's marketplace being unable to buy and sell goods - all happening seemingly with no warning."

Nonstop Facebook Over Oceans Coming Soon to Jet Near You
PDF Print E-mail

Airline passengers pining for faster in-flight Internet access anywhere in the world -- even over the oceans -- are about to get their wish as satellite operators find success where Boeing Co. (BA) failed a decade ago.

Stronger, more-focused signals from spacecraft lofted by providers such as Intelsat SA (I) will replace cobbled-together connections meant for mobile phones and television broadcasts. Costs will fall, too, eventually making onboard broadband a free amenity to win travelers’ loyalty, industry executives say.

The technology is poised to bring sweeping changes in airborne Wi-Fi now marked by balky downloads, dead zones and scant public enthusiasm. ViaSat Inc. (VSAT), whose service will debut on JetBlue Airways Corp. (JBLU) aircraft next month, promises more satellite-delivered bandwidth for each passenger than current market leader Gogo Inc. (GOGO) can offer to an entire plane.

“Ten years ago, we used to use dial-up; nobody does that anymore,” said Tim Mahoney, chief executive officer of the aerospace unit of Honeywell International Inc. (HON), a satellite-hardware supplier. “That evolution that we’ve gone through in our home setting is going to take place on the aircraft.”

So-called spot beams from the new satellites deliver a more-concentrated signal than those blanketing a region with TV images. There’s enough bandwidth for scores of fliers to share, with moving jets handed seamlessly from one beam to another. It’s akin to connecting a Starbucks Corp. (SBUX) coffee shop full of Wi-Fi users -- if the store were zipping through the stratosphere.

Satellite Competitors

Inmarsat Plc (ISAT), which will pipe its signal through Honeywell equipment, plans to girdle the globe with three spot-beam satellites launched by 2014. Intelsat expects its first Epic satellite in space in 2015. By then, JetBlue plans to have ViaSat’s Wi-Fi on all its planes, airline CEO Dave Barger said this week.

In-flight Internet is available on only about 40 percent of the U.S. and Canadian airline fleets, said Jim Breen, a Boston-based William Blair & Co analyst. Usage is even less: Satellite provider Global Eagle Entertainment Inc. (ENT) estimates that only about 5 percent of fliers on Internet-enabled planes pay to hop online.

“When the plane lands, almost everybody immediately pulls out their phones,” said Mark Dankberg, CEO of Carlsbad, California-based ViaSat. “That gives you a sense of how many people would use it if it were better.”

Hit, Miss

Cory Levy, co-founder and chief operating officer of mobile application company One Inc., is part of that unsatisfied group. He buys Wi-Fi on only about half of the weekly flights he makes between San Francisco and Los Angeles.

“Fifty percent of the time, it works really well and probably 50 percent of the time on the SF to LA flight I can’t even get Gmail to load,” Levy said. “It’s sort of like a hit or miss.”

Aerial Wi-Fi was kicked around for years as a concept before Chicago-based Boeing introduced Connexion, a service sold to airlines to deliver broadband via a global satellite network. Unveiled in 2000, the program faltered as travel slumped after the Sept. 11 terror attacks, and Boeing pulled the plug in 2006.

That left a void filled by Gogo, whose system of ground towers and mobile-phone spectrum grabbed the largest share of the U.S. in-flight Internet market, serving carriers including American Airlines and United Airlines. (UAL) Itasca, Illinois-based Gogo charges fees such as $14 for all-day service.

TV Adaptation

Panasonic Avionics Corp., Global Eagle and others jumped in, too, knitting together systems with satellites designed for direct-to-home television.

Like the mobile-phone technology, the older spacecraft had limits on broadband speed. Gogo’s system only provides a signal over land, creating hours-long Web blackouts on over-water flights.

“When you’re stuck going far over the Atlantic for nine hours, there’s only so many movies you can watch,” said Matt Kepnes, who flies to Europe and Southeast Asia about once a month for his New York-based travel blog, Nomadic Matt. “I like getting on my computer and chatting on Facebook and talking to my friends, checking my e-mail and getting some work done.”

Gogo plans to migrate to satellite to help expand overseas and boost speed, CEO Michael Small said.

“Air-to-ground was a unique situation that worked just right in the U.S. for us to get the early lead,” Small said in a telephone interview. “But in the long run, it will be predominantly a satellite solution.”

Frequency Choice

Still unsettled are technological questions such as which spectrum is most efficient for in-flight Internet, leaving airlines to weigh conflicting claims.

Satellites for ViaSat and London-based Inmarsat use the higher-frequency Ka band, which potentially has twice the capacity, said Chris Quilty, a Raymond James Financial Inc. analyst in St. Petersburg, Florida. Luxembourg-based Intelsat’s Epic satellite will use the Ku band, the workhorse spectrum in the last decade, and will be able to match rivals’ power, CEO David McGlade said in a telephone interview.

Airlines’ choices will lock them into one system or the other because antennas for the different bands aren’t compatible, echoing the VHS-versus-Beta videocassette battle. The cost of equipment and aircraft downtime for installation precludes switching easily, Quilty said.

JetBlue’s Path

JetBlue CEO Barger said the airline will start ViaSat Wi-Fi trials on three planes next month, before pushing the service to all its larger Airbus SAS (EAD) planes next year. The timeline for equipping smaller Embraer SA (EMBR3) jets in 2015 may be accelerated to next year, Barger said in a telephone interview.

Internet access will be free on the first 30 ViaSat-equipped planes, said Morgan Johnston, a spokesman. After that, there may be a fee for heavy use such as streaming videos, he said. Johnston said New York-based JetBlue isn’t discussing pricing, saying only the service will be “obtainable to anyone on the plane.”

Passengers over time will want to be connected in the air like they are on the ground -- for free, ViaSat’s Dankberg said. New satellites will lower airlines’ Internet cost to the equivalent of a beverage and bag of peanuts per passenger, prodding carriers to offer the service to everyone, he said.

“You go to Starbucks and you can get free Wi-Fi, but you don’t feel obligated to use it,” Dankberg said. “That should become clear fairly soon that free is what people want.”

SEC Approves Using Facebook, Twitter for Company Disclosures
PDF Print E-mail

U.S. companies will now be able to post their earnings on Twitter or update their status on Facebook as long as investors have been told in advance where to look.

The U.S. Securities and Exchange Commission issued guidance yesterday permitting companies to use social media sites including Facebook Inc. (FB) and Twitter Inc. to communicate company announcements. The guidance came as part of a report detailing its investigation into Netflix Inc. (NFLX) Chief Executive Officer Reed Hastings, who in July posted monthly viewership results on his Facebook page rather than in an SEC filing or news release.

The SEC refrained from bringing an enforcement action against Hastings or Netflix, which runs a subscription service for watching television programs and movies, because rules around using social media for company disclosures had been unclear, the agency said.

“Most social media are perfectly suitable methods for communicating with investors, but not if the access is restricted or if investors don’t know that’s where they need to turn to get the latest news,” George Canellos, acting director of the SEC’s enforcement division, said in a statement.

The SEC confirmed that a regulation prohibiting companies from disclosing material information to select investors applies to social media and other emerging means of communication the same way it applies to company websites. Company communications made through social media channels could constitute a violation of the fair disclosure rule known as Regulation FD if investors had not been told in advance where the information would be posted, the SEC said.

‘A Good Thing’

Social media “has tremendous potential to level the playing field for participants in the markets,” said Stephen Diamond, a securities law professor at Santa Clara University’s School of Law. The report “shows a commission that’s being flexible and responsive, and it shows a government agency that actually thinks innovation is a good thing.”

Some investor advocates are less sanguine about the policy change. Lynn Turner, a former chief accountant at the SEC, called it “bad policy” because it will disadvantage investors who don’t use Facebook and Twitter.

‘Dumber’ Idea

“Many investors, especially those over 50, who in the aggregate have the most invested, still do not use social media,” Turner said in an e-mail. “Telling someone who does not use Twitter to go to Twitter for significant investment information is one of the dumber ideas I have heard.”

Jim Prosser, a spokesman for San Francisco-based Twitter, declined to comment.

“We welcome, and certainly agree with, the SEC’s finding that Facebook is an established means for companies and individuals to share and disseminate information broadly,” Menlo Park, California-based Facebook said in a statement.

While the agency didn’t explain exactly how a company should inform investors about social media use, the new guidance will give companies greater comfort in communicating with investors via Facebook and Twitter, said David Katz, a partner at law firm Wachtell, Lipton, Rosen & Katz.

“Do I see it as a sea change? No,” Katz said in a telephone interview. “But investor relations has moved into the 21st century and the SEC has caught up.”

Facebook Post

Hastings stirred controversy over SEC disclosure guidelines when he wrote in a July 3 post on Facebook’s website that viewing on Netflix’s video-streaming service had “exceeded 1 billion hours for the first time” in June. The incident led to calls for the SEC to broaden its rules to allow social media to be used to communicate to investors.

In December, Hastings and Netflix each received a Wells Notice, indicating SEC staff intended to pursue enforcement action in the matter. That same month, Hastings said that posting to his Facebook contingent of 200,000 followers “is very public.”

Netflix said it welcomed the SEC’s guidance. “We appreciate the SEC’s careful consideration and resolution of this matter,” spokesman Joris Evers said in a statement.

Gene Goldman, a partner at law firm McDermott Will & Emery LLP, said the report provides companies a road map for staying out of trouble.

“But the next time material information is disclosed on an executive’s Facebook page without the company alerting all shareholders to look there for information, the matter will likely be met with an SEC lawsuit instead of a report,” Goldman said.

Millions May Be Affected by Web Disruption in Online Attack
PDF Print E-mail

Millions of people may have been affected by an attack that caused disruption and a slowdown of the Internet, according to a not-for-profit anti-spam organization that blacklisted a Dutch Web-hosting company.

The interruptions came after Spamhaus, a spam-fighting group based in Geneva, temporarily added CyberBunker to a blacklist that is used by e-mail providers to weed out spam. The attacks work by trying to make a network unavailable to its intended users by overloading a server with coordinated requests to access it, according to security firm Kaspersky Lab.

Calling the disruptions “one of the largest computer attacks on the Internet,” the New York Times reported today that millions of Web users have experienced delays in services such as Netflix video-streaming service or couldn’t reach a certain website for a short time.

Special Report: Cybersecurity in the Cloud

“The size of the attack hurt some very large networks and Internet exchange points such as the London Internet Exchange,” John Reid, a spokesman for Spamhaus, said in an e-mailed response to questions by Bloomberg News. “It could be thousands, it could be millions. Due to our global infrastructure, the attackers target places all over the world.”

Spamhaus was targeted with a so-called distributed denial of service attack on the evening of March 15, Reid said.

Dutch Bunker

The attackers pretended to be Spamhaus and bombarded the Internet’s Domain Name System with simultaneous requests for information, according to Michael Sutton, vice president of security research for Zscaler. The System thinks the requests are from Spamhaus and sends them back to its website, creating a wall of data so large that the site crashes, he said.

“This attack isn’t new but I’ve never seen it abused to this scale,” he said in an interview. A traditional denial-of- service attack floods a website with tens of thousands of requests a second, causing it to temporarily shut down.

CyberBunker, which was founded 1998 and is based in a military bunker near a Dutch town called Goes, offers Web- hosting services for all sites except child pornography and anything related to terrorism, according to its portal.

“The only thing we would like to say is that we do not, and never have, sent any spam,” Cyberbunker spokesman Jordan Robson said in an e-mail.

Such attacks are growing in quantity as well as scale, according to Vitaly Kamluk, chief malware expert of Kaspersky Lab’s global research and analysis team. The two main motives for the disruptions are money through cybercrime and political and social activism, he said.

“This is indeed the largest known DDoS operation,” Kamluk said by e-mail. “Such DDoS attack may affect regular users as well, with network slowdown or total unavailability of certain web resources as typical symptoms.”

Page 1 of 22