February 24, 2004

Esphion Breaks New Ground in Battle against Worms

A ground breaking project to develop “WormTrap” software that will detect and stop computer worms within minutes after the start of an attack has won investment of $400,000 from Technology New Zealand.

Auckland company Esphion, specialists in developing technologies to monitor and analyse network traffic, has begun an 18 month R&D project which designed to identify computer worms as they first arise, stop them in their tracks and curtail the havoc they cause.

Technology New Zealand, the Government’s R&D investment agency, has contributed funding through its flagship scheme, Technology for Business Growth (TBG).

Esphion CEO Greg Cross says with the number and intensity of worm outbreaks on the rise, there is strong demand for a new generation of products that can stop costly attacks.

“The catalyst for this project was the Welchia worm which hit last year, infecting hundreds of thousands of machines around the world and bringing a lot of networks to their knees, with the excessive traffic it created” Mr Cross says.

“That caused organizations that depend on the Internet to rethink their whole approach to network protection. They now recognize that it is no longer acceptable to provide security updates after a worm has breached the network, because worms can spread and do their worst damage within 10 or 15 minutes, long before most people have even noticed there is something wrong with the system.”

Current security devices base their defense around matching a worm to a database of known ‘signatures’ to stop the worm spreading. If the worm is a new one, they need to build a new signature and then publish it so end users can then download it. Clearly this is a totally inadequate defense against fast spreading worms.

Mr Cross, a former CEO of Microsoft New Zealand, says the new ‘Wormtrap’ under development by Esphion will be a unique solution which will allow network operators, ISPs and carriers to detect and eliminate worms automatically from their network, ensuring they do not travel through their systems.

“The truly innovative feature lies in the development of data structures and algorithms which will enable detection of a massive worm outbreak within a minute or so. After a further minute a signature is automatically extracted out of the network traffic, meaning the worm cannot spread any further or inflict any damage.”

Mr Cross expects a range of new security solutions to come out of the R&D project. He says the new software will make Esphion a world leader in the fight against worms and involve a significant knowledge transfer in to New Zealand.

There is growing concern about the cost and impact of computer worms and viruses, with a survey of large enterprise IT departments in the United Kingdom, released at the end of 2003, showing that it costs four times more to clean up after an attack than previously thought.

The Corporate IT Forum in the United Kingdom says the survey, carried out after the MSBlast worm last August, showed it the costs associated with cleaning up increased by more than 400 percent in 2003. The Forum surveyed its members, which include more than half of the FTSE 100 and 250 companies, after the MSBlast worm in August 2003. The figure of £122,000 is four times that estimated by the Department of Trade and Industry (DTI) last year. According to the survey, three out of four IT departments spent around 365 person-hours repairing damage caused by the attack. However, 35 per cent of organizations were hit far worse, with each losing an average of 3,080 person-hours.

The costs result from maliciously wasted bandwidth, unscheduled downtime, service interruption, operational costs and those incurred in providing customer support

Technology New Zealand Investment Manager Hamish Campbell described Esphion’s project as exciting and one that addresses a real need in the business community.

“The R&D is extremely technically challenging, but Esphion has assembled a team that we believe can do the job. The project is at the leading edge of software development and the Technology New Zealand investment will help accelerate the results into the marketplace.”

Esphion was formed in 2000 and has a staff of 15, drawn from all parts of the globe. Its clients include many large telecommunications companies and service providers, who will be trialing the new software as it is developed and refined.

Further Information:

Greg Cross
CEO, Esphion
Tel: 09 414 4746
Mobile: 021 417799
Email: gcross@esphion.com
Web: www.esphion.com

Hamish Campbell
Investment Manager Technology New Zealand
Tel: 09 912 6732
Mobile: 021 499 531
Email: Hamish.Campbell@frst.govt.nz
Web: www.technz.co.nz