IBM's former Chinese Power Systems partner sues for theft of customer data • The Register

2022-05-11 08:45:23 By : Ms. Elaine Mao

IBM has been sued for trade secret misappropriation by a Chinese company called Beijing Neu Cloud Oriental System Technology Co., Ltd, over "fraudulent and unfair business practices" that allegedly saw Big Blue encourage use of Neu Cloud's customer information by staffers at server-maker Inspur.

According to Neu Cloud's complaint [PDF], its parent company TeamSun had been a distributor and implementor of IBM POWER technology since 2010.

"Between 2010 and 2014, reliant on its relationship with IBM, and at substantial expense, TeamSun developed technology solutions dependent upon IBM Power Systems products and actively marketed them in China," the complaint states.

TeamSun eventually created Neu Cloud to keep its Power Systems business bubbling. In July 2014, IBM even took a 19.35 per cent stake in Neu Cloud.

For its part, Neu Cloud promised to only buy kit from IBM.

"Consequently, Neu Cloud was completely reliant upon IBM's good-faith cooperation and willingness to supply Power Systems products on favourable prices and conditions, and IBM controlled Neu Cloud's pricing and sourcing for its products," the complaint states.

But by August 2014, Neu Cloud got wind that IBM was thinking of also working with giant Chinese ODM Inspur on Power systems. NeuCloud expressed its discomfort, and IBM assured it that it only wanted to work with Inspur on its WebSphere product.

Neu Cloud was satisfied and in 2015, a deal was done. Neu Cloud's complaint states it and IBM "entered into an OpenPower Original Equipment Manufacturer Agreement, which allowed Neu Cloud to purchase IBM Power Systems servers, together with certain pre-installed software products, and to develop Neu Cloud's own solutions based on such servers and sell them to end users."

For the next couple of years, Neu Cloud and IBM went about their joint business, sometimes exchanging documents that included confidential information about Neu Cloud customers. A confidentiality agreement meant that IBM China knew that information could only be used in joint deals.

But in 2017 IBM and Inspur created a joint venture of their own called Inspur Power. Neu Cloud's complaint claims that JV meant its deal to buy Power Systems kit from IBM ended, and it was forced to buy from Inspur Power instead.

The complaint also alleges that at least two former IBM China staff who had worked with Neu Cloud, and seen confidential customer info, "were encouraged by IBM China to join Inspur Power".

Then in June 2018, Inspur Power "sent letters to certain end-user customers of Neu Cloud (customers that Neu Cloud had confidentially submitted to the individuals at IBM China) to the effect that Inspur Power was the exclusive dealer of Power Systems in China".

Neu Cloud alleges IBM drove the hires of former IBM China staff, and that Inspur Power profited from the knowledge of Neu Cloud customers.

Neu Cloud wants damages, punitive damages, and an injunction prohibiting the illegal conduct described in the complaint.

"We will vigorously defend ourselves against these claims," a spokesperson from IBM told The Register.

The lawsuit adds further spice to a deal that was already controversial. In 2015 the deal with TeamSun/Neu Cloud was deemed of concern by The New York Times, which worried about the IP that Big Blue was sharing given TeamSun had ties to the Chinese government and officials who wanted the Middle Kingdom to be less dependent on US tech.

Chinese tech companies certainly liked working with IBM at the time, having noticed Big Blue's 2013 decision to create the OpenPOWER Consortium to broaden the appeal Big Blue's POWER architecture by licensing it to third parties.

Brad McCredie, who then served as CTO for IBM's Systems and Technology Group, said the plan was "taking our POWER IP, opening it up as well as decomposing it – the processor, the firmware, all of the key pieces – to enable people to innovate around Power platforms.”

By 2014 IBM boasted it had 26 companies interested in OpenPOWER. Around a dozen of those companies were Chinese and they were so interested they formed the "China POWER Technology Alliance" (CPTA), an organisation that Consortium defined as "a mechanism to help global OpenPOWER Foundation members engage with China organizations on POWER-based implementations in China," according to a January 2015 blog post. Later in 2015 CPTA was invited to participate in the OpenPOWER advisory board, alongside the Facebook-derived Open Compute Foundation and the Linux Foundation.

Inspur was an early CPTA member and still makes POWER-powered servers.

But China these days seems more interested in the Arm and RISC-V architectures, probably due to Inspur's inclusion on the USA's Entity List of companies forbidden to access US technologies without a license. ®

Updated with IBM comment at 07:00 UTC, September 13th.

Yahoo Japan has revealed that it plans to go passwordless, and that 30 million of its 50 million monthly active users have already stopped using passwords in favor of a combination of FIDO and TXT messages.

A case study penned by staff from Yahoo Japan and Google's developer team, explains that the company started work on passwordless initiatives in 2015 but now plans to go all-in because half of its users employ the same password on six or more sites.

The web giant also sees phishing as a significant threat, and has found that a third of customer inquiries relate to lost credentials.

Analytics industry veteran SAS has announced support for Python in its proprietary analytics studio.

Founded in 1976, SAS developed its own language which derived from a North Carolina State University project and is deployed across its range of analytics and machine learning environments.

Bryan Harris, CTO and executive vice president at SAS, told us he wanted to offer users an alternative.

For the past six months I've been staring at the backside of my iPhone 13 Pro wondering what possessed Apple to build a Light Detection and Ranging (LIDAR) camera into its flagship smartphone.

It's not as though you need a time-of-flight depth camera, sensitive enough to chart the reflection time of individual photons, to create a great portrait. That's like swatting a fly with a flamethrower – fun, but ridiculous overkill. There are more than enough cameras on the back of my mobile to be able to map the depth of a scene – that' how Google does it on its Pixel phones. So what is Apple's intention here? Why go to all this trouble?

The answer lies beyond the iPhone, and points to what comes next.

India has accused ride-sharing companies of over-charging loyal customers who regularly take the same route, and directed six platforms to become part of a scheme that offers third-party grievance handling services.

The directive to join the scheme was issued during a meeting with officials of India's Department of Consumer Affairs, attended by Ola, Uber, Rapido, Meru Cabs and Jugnoo. The platforms were advised to improve responses to customer concerns and rights and directed to become "convergence partners" in India's National Consumer Helpline. Such partners are required to accept and resolve consumer grievances reported to the Helpline.

The Department said ride-sharing companies need to sign up for the helpline for reasons including that their algorithms set fares in ways that are not easy to understand – sometimes even charging loyal customers higher rates than first-timers on the same route.

Apple has ended production of the last remaining version of the iPod – the iPod Touch.

A May 10 announcement broke the news gently, referring to the iPod Touch being available "while supplies last".

Apple pointed out that the iPod's core function – storing truckloads of songs in a portable device – has long since migrated into its smartphones, tablets, and wearable devices.

Intel Vision Scale Computing announced a strategic partnership with Intel on Monday to offer a fully integrated, low-power platform for deploying and managing applications at the edge.

Founded in 2007, Scale Computing offers a range of hyperconverged infrastructure (HCI) products for datacenter, cloud, and edge environments. This includes its HC3 software platform, which provides a stripped down version of its HCI software stack for low-power edge appliances.

The company's latest partnership with Intel aims to address growing demand for ultra-low latency applications in retail, industrial, and IoT environments by enabling those workloads to run on validated hardware at the network edge.

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"These cloud principles simply have to creep into enterprise networking. Otherwise they're going to be outclassed as they compete against more and more of these SaaS-type companies," he warned.

This isn't an easy ask, he admits, because operators of datacenter networks don't have the luxury of starting fresh. "What you can do is claw back piece-by-piece some freedom architecturally by making good sound decisions over and over again."

Microsoft patched 74 security flaws in its May Patch Tuesday batch of updates. That's seven critical bugs, 66 deemed important, and one ranked low severity.

At least one of the vulnerabilities disclosed is under active attack with public exploit code, according to Redmond, while two others are listed as having public exploit code.

After April's astonishing 100-plus vulnerabilities, May's patching event seems tame by comparison. However, "this month makes up for it in severity and infrastructure headaches," Chris Hass, director of security at Automox, told The Register. "The big news is the critical vulnerabilities that need to be highlighted for immediate action."

Intel Vision The rollout of Intel's Arc discrete GPUs has been slower than expected for folks hungry for a fresh option in the computer graphics hardware market. This week, the x86 giant attempted to explain what's taking so long.

On the eve of this week's Intel Vision event, the chipmaker shared a note Monday acknowledging delays in its family of Arc GPUs for laptops. The US biz also clarified that Arc GPUs for desktops will only land in China in the second quarter, meaning by the end of June, before becoming more broadly available across the world.

Intel "launched" its lowest-end mobile GPU, the Intel Arc 3, at the end of March while promising the more powerful Intel Arc 5 and Intel Arc 7 graphics would hit laptops in early summer. Intel also vowed at the time that desktop GPUs would arrive in the second quarter. All of this was offered with no caveats.

Special report Security consultant Lance Vick recently acquired the expired domain used by the maintainer of a widely used NPM package to remind the JavaScript community that the NPM Registry still hasn't implemented adequate security.

"I just noticed 'foreach' on NPM is controlled by a single maintainer," wrote Vick in a Twitter post on Monday. "I also noticed they let their domain expire, so I bought it before someone else did. I now control 'foreach' on npm, and the 36,826 projects that depend on it."

That's not quite the full story – he probably could have taken control but didn't. Vick acquired the lapsed domain that had been used by the maintainer to create an NPM account and is associated with the "foreach" package on NPM. But he said he didn't follow through with resetting the password on the email account tied to the "foreach" package, which is fetched nearly six million times a week.

Intel Vision Intel has said it has put "desktop-caliber" silicon in a mobile package to provide its fastest 12th-generation Core laptop processors yet.

The chipmaker unveiled the seven 12th-generation Core HX laptop chips at the Intel Vision event Tuesday, where the company also revealed AI chips meant to challenge Nvidia and a roadmap for its fledgling product line of infrastructure processing units for datacenters.

These latest Core chips are expected to power more than 10 laptops coming out later this year from Dell, HP, Lenovo, and other PC makers, and they are based on the same Alder Lake hybrid architecture that debuted with Intel's 12th-gen Core S-Series processors for desktop PCs last fall.

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