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SafeWeb shuts free anonymous Web service - was partly funded by C.I.A.




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CNN.com Sci-Tech
http://www.cnn.com/2001/TECH/internet/11/20/privacy.reut/index.html

SafeWeb shuts free anonymous Web service

November 20, 2001 Posted: 9:53 AM EST (1453 GMT)

SAN FRANCISCO, California (Reuters) -- An Internet privacy firm has closed an anonymous Web surfing service that had been partly funded by the CIA and intended to give Web users in countries such as China and Iran a way to circumvent censors, the company said Monday.

Emeryville, California-based SafeWeb last week quietly shut down its service which allowed people to surf the Web anonymously for free, and is unlikely to restart it, spokeswoman Sandra Song said.

The service, which had allowed users to be practically invisible on the Internet, was the second of its kind to close in as many months, a trend experts ascribed primarily to commercial problems, but also a shifting mood in the United States that favors national security over protection of privacy.

SafeWeb is focusing on developing a security product targeted at corporations, she said. The so-called "extranet appliance," will enable remote workers, partners and clients to access a corporate network securely over the Internet, she said.

"This is the space to be in if we want to be profitable," said Song of the corporate security market. "Consumer privacy is more of an idealistic vision. It's a project, something we had a passion to deliver on and we did."

The move mirrors that of Montreal-based Zero-Knowledge Systems, which announced in October that it would discontinue its Freedom Network services, which enabled people to surf the Web and send e-mail anonymously.

Zero-Knowledge, which charged $50 per year for the service, is concentrating on selling a suite of security software to consumers that includes a personal firewall and password manager.

Privacy eclipsed by security, slow economy

Zero-Knowledge and SafeWeb were among a group of companies that cropped up between 1997 and 2000 to address the privacy concerns of people annoyed that the Web sites they visited could be tracked.

A push for legislation mandating strict online privacy regulations has been eclipsed by U.S. government arguments justifying increased online surveillance to protect national security after the attacks on the World Trade Center and the Pentagon on September 11.

Even before then, however, the decline of online companies, particularly those relying on advertising and subscriptions, was forcing Internet privacy firms to reconsider their business models, privacy companies said.

"We knew we would be shifting gears" earlier this year, said SafeWeb's Song. "The ad model doesn't work."

The company, which provided its free service to hundreds of thousands of people for over a year, was started by executives from China and Iran who wanted to give people a way to circumvent government-sponsored Web censorship, said Song.

SafeWeb will still provide anonymous Web browsing for a fee through a partnership with PrivaSec LLC and will provide a trial service for the Voice of America and Radio Free Asia that will allow people in China to access Web sites blocked by the government, she said.

The U.S. Central Intelligence Agency's venture capital arm, In-Q-Tel, has invested $1 million in SafeWeb, including $250,000 to license technology, Song added.

Anonymizer.com survives

The problem for the companies is that people don't see the need for anonymous Web surfing, said Richard M. Smith, a Boston-based Internet security and privacy consultant.

"People don't, maybe, understand that they're being tracked and if they do they don't care very much," Smith said.

Another privacy expert argued that people care, they just aren't willing to pay for protecting their privacy.

"I think it's generally true that most users are not going to pay for any (additional) services or features," said David Sobel, general counsel of the Washington, D.C.-based Electronic Privacy Information Center.

"Privacy is important to them, but they don't think the burden of protecting privacy should be put on them," Sobel added. "They want to see (government) restrictions on how companies can collect and use their information."

One company that is still making money off privacy is Anonymizer.com, a San Diego-based company that offers anonymous Web surfing for $50 a year, or $5 a month. The company has 20,000 active subscribers, said President Lance Cottrell.

"We're still seeing very strong growth," Cottrell said. "Most people are looking to prevent their boss, insurance company, spouse, ISP (Internet Service Provider) from knowing where they're going."

Even so, Anonymizer.com began a push six months ago to market its service to corporations, including law and investigation firms, and the U.S. government, he said.

"Intelligence agencies have been using us for years, especially since September 11," Cottrell said. "They use us to keep an eye on bad guy sites" with covert monitoring.







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