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INTEL ANNOUNCED last week that it is working with RSA Data Security on new technologies that will allow it to build Pentium III chips with support for security and e-commerce built in. A unique ID and a random number generator are planned to boost efficiency and data encryption.

"We're entering an age where e-commerce transactions will be conducted on a global network consisting of a billion connected PCs and hundreds of millions of servers. These transactions must be secure," said Michael Glancy, general manager of Intel's platform security division. "Products from Intel and RSA that incorporate new security technologies will help ensure that the development of secure applications continues at a rapid pace."

As well as aiding e-commerce the technology would help Intel crack down on the trade in over-clocked processors where a 266Mhz chip can be tweaked to run at 400Mhz and sold for a premium. Some analysts, however, are concerned that the new features raise privacy issues, as they allow users to be tracked while they surf the Net. Intel is thought to be working on a software patch to turn off the ID feature.

A RECORD for cracking the 56-bit Data Encryption Standard (DES) algorithm was set last week in a joint effort between the Electronic Frontier Foundation (EFF) and Distributed.Net. An encrypted message was uncovered in 22 hours 15 minutes, winning the team $10,000 (pounds 6,200) from RSA Data Security, an organisation that sponsors encryption-breaking challenges as part of its lobbying to allow the unfettered export of strong encryption software from the United States.

The previous record of 56 hours was set last July by EFF using a specially built computer, Deep Crack. This time a network of 100,000 PCs on the Internet was used. "When designing secure systems and infrastructure for society, listen to cryptographers, not to politicians," John Gilmore, EFF co-founder, said. He added that the record should be a warning to anyone who relies on 56-bit keys to keep data secure.

"DES was a very strong algorithm," Jim Bidzos, RSA president, said. "But any algorithm, any key size, will eventually run out of life. DES has served well over the last 23 or 24 years."

THE MICROSOFT trial in Washington continued last week with Microsoft's first witness, the MIT economist Richard Schmalensee, defending the company's decision to integrate the Internet Explorer browser into its operating systems and rejecting Department of Justice (DOJ) accusations that the decision had harmed consumers by limiting choice.

DOJ lawyer David Boies produced an internal Microsoft marketing report from 8 May 1998, which said IE was "fundamentally not compelling... not differentiated" from Netscape's browser. Schmalensee agreed, undercutting Microsoft's claims that its $500m (pounds 310m) research spending had produced a better product. He also acknowledged that the integration of products would worry Netscape, and that Microsoft had spent money to induce service providers to use IE rather than Netscape Navigator, buying out their contracts with Netscape.

Schmalensee maintained, however, that Microsoft was not a monopolist and couldn't restrict distribution of competing computer software. Using economics arguments, he outlined a case based on pricing suggesting that if Microsoft was indeed a monopolist it would be charging $500 to $2,000 for a copy of Windows 98, instead of selling it to computer makers at about $50.

NETWORK SOLUTIONS Inc, the body that has held a US government monopoly on assigning top-level domain names, had difficulties in registering new names last week. Instead of a matter of hours, the company's software took days to process new applications. Some customers say their requests were lost, resulting in other people registering their domains.

NSI, which last year registered 1.9 million addresses - almost double that of the previous year - said problems were due to record numbers of registrations and a series of fraudulent e-mail registrations since the New Year, overloading the system. Competitors fear that the problems will delay NSI's ability to make its database available in March as part of the plan to cede its authority when its contract to assign domain names expires.

IN WASHINGTON last week, the Federal Trade Commission (FTC) said it would delay until 9 March the administrative hearing due next month of charges against Intel. Lawyers from both sides requested extra time to prepare their cases and pre-trial depositions.

Intel, which makes four out of five processors found on desktop PCs, is alleged to have abused its dominant position in the computer chip market by withholding technical information from three competitors - Compaq, Digital and Intergraph - who had sued it for patent infringement. In preparing its case the FTC spent a year and a half interviewing other Intel rivals, such as AMD and National Semi-conductor, implying that is considering a wider anti-trust action.

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