The webhost industry: week review (February 13, 2004) - It was a harrowing week for software giant Microsoft, as the company faced ongoing threats from the new variants of the MyDoom virus, issued a patch for a critical flaw in its operating system software and, by the week's end, saw some of its source code illegally leaked to the Internet.
On Thursday, it was reported that parts of the source code for the Windows 2000 and Windows NT 4.0 operating systems had been illegally leaked on the Internet. The company said it was assisting law enforcement agencies in investigating the situation, adding that the leaks were not the result of any breach of its networks or internal security. Some analysts say that the source code could allow hackers to exploit potential vulnerabilities in the Windows operating systems, and others say it could help rivals better understand the popular software. Security firms, however, say the leak's biggest impact will be on the company's credibility, potentially encouraging programmers to migrate to Linux or other open source solutions.
On Tuesday, a third variant of the MyDoom virus was identified, programmed to launch a distributed denial of service attack against the Microsoft Web site. The new MyDoom.c variant is reportedly a stripped-down version of the MyDoom.a and MyDoom.b versions, designed to spread through backdoors left open by the original virus, rather than through email or file sharing networks. While earlier versions of the virus were programmed to expire February 12, the new version is designed to eliminate the deadline and unleash a larger payload against Microsoft.
When the February 12 deadline arrived on Thursday, earlier versions of the virus stopped spreading, but security experts warned that backdoors left open by the original worms would remain open until the machines were cleaned, leaving them vulnerable to other worms and hackers looking for machines open to attack. Security firm mi2g reported on Thursday that a fourth variation of the worm had emerged that, like MyDoom.c, was programmed to launch a DDoS attack against Microsoft and used the backdoor left by the original virus to propogate.
Amid its other troubles, Microsoft said on Tuesday that it had released a patch designed to repair a "critical" vulnerability in its Windows NT 4.0, Windows NT Server 4.0, Windows Server 2003, Windows 2000 and Windows XP systems. A buffer overflow in the Micosoft ASN.1 Library, said Microsoft, could allow code to be executed on an affected system, enabling an attacker to take control and install programs, view data, change data, delete data or create new accounts with full system privileges.
Along with all the Microsoft-related tribulations, this week saw several significant acquisitions from companies associated with the Web hosting business.
On Monday, network equipment maker Juniper Networks announced that it would acquire network security solutions developer Netscreen Technologies in a stock deal worth approximately $4 billion. Juniper said it would trade 1.404 of its own shares for each share of Netscreen. Expected to complete in the second quarter, the deal is intended to expand Juniper's share of the corporate market.
On Tuesday, Web hosting firm midPhase Services announced that it had entered an agreement to buy ThrillHost.com. MidPhase said it would retain the ThrillHost.com brand and use it to offer reseller hosting services, which were launched in September of 2003.
And on Wednesday, Sun Microsystems announced, among other things, that it had entered an agreement to acquire server maker Kealia in a stock transaction. The company also said that it had introduced a refreshed lineup of UNIX-based Sun Fire systems, which it called the industry's first throughput computing systems. The company also updated its software products, including the N1 grid system, Solaris 10 operating system and the Java enterprise system, that work with the new Sun Fire enterprise servers.
While Microsoft was particularly notable for some particularly unpleasant circumstances this week, the most interesting future development to follow from this week's news will likely be the manner in which the company is affected by the continuing attacks promised by the ongoing development of the MyDoom virus.
MidPhase Acquires ThrillHost.com (February 10, 2004) - Chicago-based Web hosting provider midPhase Services (midphase.com) announced on Tuesday that it has entered into an agreement to acquire ThrillHost.com (thrillhost.com), a Web hosting provider based in Missouri.
Terms of the deal were not disclosed.
"ThrillHost.com has an excellent product, strong and loyal following and a wonderful reputation," said Dan Ushman, co-founder of midPhase. "midPhase intends to live up to everything that ThrillHost.com...worked to build."
MidPhase said it will retain the ThrillHost.com brand name and use it to to offer reseller hosting services.
"Our goal was not to have the most customers, rather our mission was to provide the best service available and I am confident that this philosophy will continue with midPhase at the helm," said Matthew Karas, original founder of ThrillHost.com.
MidPhase launched its reseller program last September.
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