lynx-dev France becomes more cryptic

[Philip Webb]

Financial Times (London) 990121

FRANCE: Industry welcomes Internet liberalisation
 -- Samer Iskandar & David Owen, Paris

By announcing a series of measures liberalising the use of the Internet,
the French government has put its money --  FFR 3,7 G = USD 654,8 M  1998 --
where its promise was.  Telecom operators, software & hardware makers,
computer users & a wide array of retailers welcomed the decision
by PM Lionel Jospin to lift restrictions on the use of encryption,
which had been one of his first pledges when he formed his government 9705.
Combined with a call by Jospin for lower Internet access costs, it paves
the way for e-commerce to take off in France, which has been lagging
behind international trade partners, eg USA, UK & Italy.

The previous framework was widely blamed for consumers' distrust of e-commerce,
but with this move, experts are confident "total safety" can be guaranteed
for e-transmission of sensitive information, eg credit-card numbers.
One expert familiar with the government's plan said the previous limit
of  40 bit  encryption could be circumvented with a PC equipped
with a Pentium 300 MHz chip, widely available for  c $ 1500 .
Experts believe the technology needed to beat  128 bit  encryption --
the new authorised limit -- will not be available in the foreseeable future:
"The  128 bit  threshold amounts to total safety by today's standards".

Analysts said Jospin's decision had been forced by the fast pace
of technological advance & market conditions, with France standing out
as the only industrial country regulating encryption.  Until 9803,
it was illegal to use any form of encryption & before this week's decision
only software with capacity  < 40 bits  was unrestricted.  Users
of more powerful encryption software had to disclose a decrypting code
with a `trusted 3rd party' approved by the government & obliged to supply
it to authorities when officials suspected encryption was being used illegally.

Meanwhile, encryption software was widely available, sometimes free of charge,
on the Internet: "Restrictions affected only legal users, eg the computer
industry & companies involved in e-commerce", said a lawyer (Paris):
"Terrorists & money-launderers at whom the law was aimed were never going
to give their decryption keys to the authorities.  Tests were introduced 9803
to determine whether a piece of software was legal, but were so complicated
they proved impossible to apply.  40 bit  technology allowed us to protect
a safety code, seg credit-card PIN, but  128 bits  makes it possible
to protect a whole document & takes protection into a whole new dimension".

Jospin had to overcome strong opposition from French police & the army,
which required the move to be made in consultation with Pres Chirac.

Investors welcomed the decision, driving shares in partly-privatised
France Telecom up  8,5 %  on the Paris Bourse.  Internet-linked revenues
are seen as France Telecom's most promising source of earnings growth.
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