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Large Korean Companies Reconsider or Withdraw from Cloud Conversion Projects
Indiscriminate NSA Hacking
Large Korean Companies Reconsider or Withdraw from Cloud Conversion Projects
  • By matthew
  • May 15, 2014, 07:20
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POSCO and Samsung decided to reconsider or withdraw rom their cloud conversion project. The decision can be interpreted to mean that they belatedly realized the seriousness of the possible leakage of industrial secrets. In the past, cloud conversion was deemed necessary to handle business in a flexible and efficient manner in the global market. However, companies now seem to be well aware of the fact that their confidential information could be passed on to foreign enterprises as a result of the conversion.  

Last year, it was revealed that the U.S.’s National Security Agency (NSA) obtained information about governments and corporations worldwide using equipment and platforms of telecommunication operators and Internet companies in the U.S. In light of the recent incident, U.S. corporations’ reliability in security is plummeting to the extent that it won’t be easy to recover.  

Some countries that are serious about these kind of security threats have already been trying to reduce their heavy dependence on the Internet led by the US, working to make an independent Internet order. China began its effort to protect its confidential information by creating a task force aimed at protecting the country from “cyber surveillance” of the Internet and cloud environment, led by Xi Jinping, the country’s president. As for the EU, the construction of a separate communication network was discussed to avoid emails and other data passing through the US. Although no countries have come to a conclusion yet, governments around the world appeared to be aware of the seriousness of cyber surveillance and the outflow of confidential information. 

Korea, on the other hand, already allowed the US to move internal information to other countries through the implementation of the US-Korea Free Trade Agreement. In short, it is possible for POSCO to store its steel-making technology or expertise at Google’s data center through Google Cloud Platform. 

But POSCO seems to be mindful of related threats. POSCO forged a strategic partnership in 2011, and pursued “POSPIA 3.0,” a future integrated management system aimed at switching all of its systems to the Google Cloud Platform. But the steelmaker discontinued the project and started to reconsider its plan. Experts said, “As the fact that Google offered information to the NSA for cyber surveillance was revealed last year, the issue of maintaining confidential information safe apparently emerged in POSCO.” 

The same is true for Samsung Group. Previously, the group considered using Microsoft Exchange Server in its business portal “MySingle,” but dismissed the idea. The major reason reportedly lies in security. An official at Samsung SDS remarked, “Currently, some of Samsung Group’s affiliate companies, in particular, the financial affiliates with a lot of outside sales activities and security incidents, are working on separating their corporate networks. The measure is to strengthen network security using only MySingle for e-mail access and messenger use.” The official added, “A pathway that can link MySingle messenger and e-mail with Microsoft’s Outlook and Messenger is open at the moment. We are trying to come up with measures to address this security risk.”

The decision of POSCO and Samsung is likely to have an influence on other companies that are working to introduce a cloud system.