THE WILD frontier

TOMORROW'S GLOBAL VILLAGE WON'T BE SOME COSY IDYLL. RATHER, SAYS PETER POPHAM, INTERNATIONAL CYBERSPACE WILL BE LIKE THE OLD WILD WEST: A LAWLESS ZONE. CRIMINALS OF ALL SORTS ARE ALREADY EXPLOITING IT

The type of the computer criminal of the day before yesterday was the American Kevin Mitnick, an overweight, myopic prodigy who hacked into some of the most elaborately protected systems in the US, including Pacific Bell's command system and NASA's Jet Propulsion Laboratory. Having got into these sacred cyberspaces, he did no harm - but he frightened the wits out of the corporations concerned, and was sent to gaol in 1988.

Since then, computer crime has grown up. Today it poses multifarious threats to all the organisations that depend on computers - that is, all significant organisations. All the companies on the FT-SE 100 have been assaulted by hackers; the Pentagon has sustained 250,000 attempts to penetrate its computers, and the Ministry of Defence is regularly besieged. Earlier this year, the Sunday Times claimed that 40 financial institutions in the City had been attacked since 1993; in the biggest single sting pounds 13m was paid into an offshore account to buy off further attacks, and a total of some pounds 400m is believed to have been paid out. Transactions in so-called "e-cash" - predicted to rise to 35bn by 2005 - are potentially a tempting way to launder criminal funds, as they cannot be traced as cheque or credit-card transactions can. And computer systems all over the world are infested with some 8,500 viruses - software programmes that destroy valuable data; up to 2,000 new strains are released every month.

More alarmingly, detection of computer crime lags desperately far behind its commission: large tracts of cyberspace - the hundreds of thousands of networks on the Internet, for example - remain impossible to police; and although criminal abuse of computer systems has been an offence in Britain for six years, the numbers convicted of it remain minuscule, and confined to the Mitnick tendency.

But the new breed of cybercriminal is no juvenile meddler; he has very clear goals. Often helped by vulnerable young nerds, he hacks into companies to steal sensitive information of every description: hospital databases, credit reference agencies, tax files and files in newspaper offices have all been ransacked for potentially valuable information. Those behind the ransacking include firms conducting industrial espionage, detectives investigating for clients, and rival newspapers hoping to scoop a scoop. Some of the tools required to break into protected systems - files containing so-called cracker or sniffer programmes - change hands on the Internet.

The rapid development by companies of their own internal telephone networks has prompted the growth of telephone hacking, which recently hit the news when it emerged that American hackers had broken into Scotland Yard's system and used it to make pounds 1m worth of international calls. These private networks allow employees to make international calls from home using a password which means that most of the cost is charged to the company. The phone hackers use a special programme which runs through millions of number combinations until the right one is identified - whereupon they can phone away as much as they like. In the United States, illegal street telephone "companies" use the passwords to sell cheap network time.

A vastly inflated phone bill is not the only risk companies run. Having hacked into the phone system, clever criminals can access information in in-house voicemail, and can even set up their own illegal communications network within the company, employing voicemail boxes using the firm's system, much as the human hosts were put to use in the Alien films. Telephone hacking has already become a major problem on both sides of the Atlantic; it is said to be costing American firms pounds 2bn per year, and British firms up to half that much.

But the fastest-growing crime in the UK is not phone-hacking but a far cruder and riskier crime: stealing the semiconductors which are the computers' brains. The risks involved were graphically illustrated in March when five men were arrested after a chase across the rooftops of Southampton, following an alleged burglary. The lure is that generally semiconductors (or microchips) are only secured inside the computer by a couple of screws, and once removed they are literally worth their weight in diamonds. Thefts of chips are estimated to have cost British industry pounds 1bn last year; the biggest single incident was a theft estimated to have cost pounds 750,000. The damage caused to companies by such thefts is often disastrous, as they spend weeks unable to function normally. According to a study carried out by Loughborough University, 70 per cent of firms that suffer computer failure go out of business within 18 months.

The most terrifying variety of computer crime has not occurred yet, but if we want a bang-up-to-date disaster scenario to trouble our sleep alongside chemical, biological and nuclear warfare, this is it. The West's intelligence agencies are bracing themselves for the use of what they have dubbed "weapons of mass disruption": when terrorists take up cyberwarfare, hacking into the West's key control systems, all of which are computer-dependent. The scenario goes something like this: shares on the world's stockmarkets unaccountably plummet, sparking panic; commercial aircraft begin falling out of the sky for no clear reason; commuter trains crash into goods trains which are supposed to be on different tracks; meanwhile no one can call an ambulance because the 999 network has been blown apart by electronic "bombs".

All this mayhem is already within the power of hackers: the CIA and FBI believe that cyberwarfare now poses a threat to international security just below that of chemical, biological and nuclear arms in seriousness. The footsoldiers in the war are likely to be disaffected young nerds, who might be recruited by a hostile power such as Iran.

It's not at all clear what anyone can do to limit such threats. The unpoliceability of the Internet is proverbial. Originally designed to survive nuclear war, it defies all conventional vetting or censorship by its size and decentralised design. Quite apart from the spectre of cyberwar, this has allowed pornography and paedophile networks to flourish on the Net, and has opened limitless new opportunities for electronic harassment. Software programmes are illegally copied online; in fact copyright law is made to look ridiculous by the ease with which digital information can be copied. Criminals of every sort can base themselves on the Net with almost perfect impunity, untrammelled by the usual limitations of space and time, and with their communications encrypted with such sophistication as to be virtually uncrackable.

Cyberspace, in other words, is an authentic American invention, being the most formidable re-creation yet of the Wild West; and what superhuman shape the new Wyatt Earp is going to take is unclear. The Metropolitan Police recently wrote to Internet service-providers (ISPs), warning them that some of the material they were transmitting was illegal (because obscene). In response, the industry, in the form of Peter Dawe, former owner of a distributor called Pipex, launched an initiative called Safety Net, intended to bring in self-policing. It remains to be seen how successful it will be.

As a model for the cybercommunity of the future, the Internet as currently constituted can satisfy only the most uncompromising of libertarians. The rest of us may agree with the verdict of The Economist last year, that "building a real electronic nation involves a lot more than laying down the pipes". !

TIMETABLE OF REVOLUTION

1990: Misuse of Computers Act passed in Britain.

1993: first convictions under the Act.

1996: launch of Safety Net, first attempt in Britain to control access to newsgroups on the Internet.

2003: last-minute detection of a plot by cyber- terrorists to overthrow western governments sparks global cooperation and draconian controls to prevent further attacks. Internetpol is born