According to one police chief, yes.

District of Columbia police chief Cathy Lanier says that carriers benefit from phone theft, going so far as to insinuate that they are somehow complicit in the underground economy of stolen mobile devices.

“The carriers are not innocent in this whole game,” Lanier told the NY Times. “They are making profit off this.”

Our own reporter, Christina Farr, was recently robbed of her iPhone 5 at knife-point in downtown San Francisco. Police who took her statement were “nonchalant,” simply having far too much experience with similar crimes. San Francisco and New York Police have launched special initiatives and teams to curb mobile crime in response to the influx of thefts.

But what about carriers?

The contention seems to be that carriers should be doing more to identify stolen phones as they enter the underground resale market, often on auction sites like eBay, and are activated by new owners. Carriers have established a national stolen phone database that works by tracking stolen phones’ IMEI numbers, a International Mobile Station Equipment Identity that identifies a mobile device independently of the owner and can be used to block network access to a device that has been reported stolen.

One problem, however, is that full integration is not scheduled to take place until November. Australia, for example, had similar technology in place country-wide a full decade ago, in 2003. In addition, many Verizon and Sprint devices don’t yet have IMEI numbers.

Carriers say that the full database will help prevent crime, that they do care about cell phone theft, and that it is not just an excuse to sell another phone or register another subscriber.

Image credit: Dave Hosford/Flickr

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Despite all better judgment, New Yorkers still love to use their iPads and iPhones while riding the subway. And thieves love to steal them.

The problem so big in the city that it’s gotten the attention of the New York Police Department, which has created a team to work with Apple to retrieve stolen devices.

“We’re looking for ways to find individuals who have stolen Apple products and return the products to their original owners. It is being done to learn the pattern who is stealing,” an NYPD spokesperson told the New York Post.

While Apple already offers its Find My iPhone app to help owners track lost devices, knowing where your device has wound up isn’t particularly helpful if there’s no safe way of getting it back. Hence why the NYPD’s involvement is so important.

The most common theft tactic on subways is to snatch devices away from oblivious owners right before the subway doors close. It’s simple, effective, and, unless the would-be victim has Spider-Man’s reflexes or Superman’s grip, almost completely foolproof. (The video below shows how it’s done in Hungary, but you get the idea.) I’ve seen this method in action first-hand, and I can confirm that the victim never stood a chance.

Anyway, my advice is this: Either keep your iPhone in your pocket, or be better about securing it from bad guys.

This sponsored post is produced by StackSocial.

There’s technology out there that won’t only help you track down your lost or stolen devices – but will give you the ability to provide the police with the exact location of your device (along with pictures of the thief in the case of theft). So when your device gets lost or stolen it’s a major blow to your livelihood – and Prey is here to protect and restore it.

Prey is open source software that gives you a 24/7 tracking and recovering capabilities so you can recover your lost or stolen devices. It keeps track of your laptop, phone and tablet whenever stolen or missing — easily and all in one place. And the VentureBeat Store has it right now for just $49!

Here’s how Prey works…

You install a tiny agent in your PC, Mac, or phone, and that agent silently waits for a remote signal to wake up and work its magic.This signal is sent either from the Internet or through an SMS message, and allows you to gather information regarding the device’s location, hardware and network status, and optionally trigger specific actions on it.

Let’s take a look at Prey’s features…

• Sends incredibly accurate location updates.
• Snaps pictures of the thief with the devices built-in camera.
• Tracks which files have been accessed or changed on your system.
• Grab screenshots of what the thief is doing on your computer.
• Tracks which programs the thief has running.

This VentureBeat Store offer is for an annual home plan of Prey, which allows you to cover up to 10 devices. Prey works for Windows, Linux, OS X, iOS, and Android, so no matter what devices you’re using, Prey will have you – and your gear – covered.

But this deal won’t be around for long. Get Prey from the VB Store page for only $49 now – and give yourself peace of mind today!

A woman’s hotel room was burglarized due to a known vulnerability in hotel key card readers from Onity, according to Forbes. The robbery occurred at a Hyatt in Houston, Texas.

According to Forbes, Janet Wolf’s laptop was stolen in September after Matthew Allen Cook allegedly used a hack made public at a security conference in July to force the locks and gain access to Wolf’s Hyatt House Galleria room. Cook was arrested and charged with theft.

Mozilla security researcher Cody Brocious first showed off his hack at the Black Hat conference in Las Vegas. Forbes reported the story a week before the conference, saying, Brocious didn’t plan on telling Onity before the presentation. Brocious created a device that plugs into a DC power port on the Onity hotel card readers. He said it cost him less than $50 to make it, and all he needed to do was plug it in, turn it on, and the lock would open.

In order to fix the issue, according to Forbes, the Hyatt House Galleria used putty to fill the holes, blocking off the DC port.

You might wonder why in three months the company hasn’t made a less damaging fix to this vulnerability, but it’s not that simple. It’s not like the key card readers are all linked together and can be updated remotely. In order to fix the reader, Onity would need to develop a new reader that did not have the vulnerability and then get hotels using its readers to replace all of the “compromised” ones. And a lot of those hotels likely don’t have the budget to do a lock upgrade.

We reached out to Onity for comment, but have not heard back from the company.

Hotel lock image via Shutterstock

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Samsung owns 99 percent of the world’s OLED market. This is one reason why, the company claims, Korean rival LG has been hiring its engineers and stealing its intellectual property.

So Samsung is suing LG in a Seoul court.

It might appear to be a case of the pot calling the kettle black, considering Samsung’s recent loss in the iPhone patent case. However, this is a very different scenario.

According to the complaint, LG has been systematically recruiting key Samsung engineers, who are breaking noncompete employment contracts by signing on. As a Korean news agency states, Samsung claims that ”LG Display has consistently acquired our OLED technologies and other business secrets by inducing our researchers to transfer.”

Eleven people were indicted for stealing or improperly sharing Samsung’s corporate secrets in July, including a key engineer in Samsung’s development of AMOLED technology (Active-Matrix Organic Light-Emitting Diode).

With sales of OLED and AMOLED displays predicted to hit $44 billion in 2016, the battle is really about the future and who will own the bulk of that market. If Samsung can maintain its technology lead, it can effectively shut competitors — including LG — out of that business.

Samsung is demanding a billion won for each case of infringement, which is equivalent to about $900,000 U.S.

photo credit: khrawlings via photo pin cc

As more people own phones, more people are going attempt to steal them. It’s a law of averages.

And, thankfully, AT&T realizes this: The company is nearing the July 10 release of a new service to block phone thieves from using stolen devices, The Verge reports.

Using the service, AT&T subscribers will be able to deny voice, data, and texting service to any device they report as stolen. This feature extends to both prepaid and postpaid subscribers, so no one’s left out.

Currently, if a phone thief snatches a phone, he can simply swap out the phone’s SIM card to avoid blocking measures. With the new plan, the blocking mechanism will be attached to a phone’s unique ID number, which makes evasion much more difficult.

The blocking service is an extension of an April announcement that AT&T and other carriers plan to create a stolen phone database. AT&T confrimed this in an email to VentureBeat.

“We will install this availability next week for AT&T phones on our network and are working toward a cross-carrier solution later this year,” an AT&T spokesperson said.

The cross-carrier plans are interesting, as they hopefully point to the phone-blocking service as less of a value-add and more of an industry standard. And that can only be good for consumers.

One thing the new service will do well is make it a lot harder for phone thieves to resell stolen devices. After all, not many people are going to be interested in buying an iPhone that can’t make phone calls.

Expect similar programs from Verizon, T-Mobile, Sprint, and a variety of regional carriers within the next few months.

Design is determining the winners in everything mobile. The most successful players are focusing on one thing: How to make products, services, and devices as compelling and delightful as possible – visually, and experientially. MobileBeat 2012, July 10-11 in San Francisco , is assembling the most elite minds to debate how UI/UX is transforming every aspect of the mobile economy, and where the opportunities lie. Register here.

Most consumers are likely oblivious to the issues of international trade fraud, but for businesses that rely on overseas suppliers, it’s becoming an increasingly large problem. The issue stems from the lack of communication between businesses, which makes it easy for fraud of all varieties to take place.

HD Trade Services aims to reduce fraud for distributors of high-value goods with its high-definition video inspection. It’s also offering a way to make business-to-business deals more efficient with its management platform. The company is making its debut today at DEMO Spring 2012 in Santa Clara, Calif., an event which is co-produced by VentureBeat.

In a survey of more than 1,200 senior executives for its latest Global Fraud Report, the consulting firm Kroll found that 42 percent of companies listed “Vendor, supplier or procurement fraud” as one of their biggest vulnerabilities last year. That’s an increase from just 26 percent in 2010.

Source: Heather Kelly/VentureBeat

HD Trade Services founders Dan Sugarman (left) and Dan Sperling-Horowitz, onstage at DEMO Spring 2012.

Using high-definition streaming video, HD Trade Services lets companies keep a closer eye on their overseas goods. The company’s technology lets you get a close look at the quality and quantity of goods before you actually make a purchase. Logistics providers can get “HD Certification” from HD Trade Services, which will allow them to perform live inspections via desktop and mobile app. And with its Deal Manager, you can forgo manual data entry and automate deals with distributors, freight companies, and the like.

In the demonstration, the founders showed how a customer could click to view details on a deal with an overseas supplier, then click on a button to view live HD video from the site where the goods are being shipped, and either pass or fail the inspection. Internet troubles interrupted the live video in the conference room, however, suggesting a potential flaw in the technology: It depends on a reliable connection on both ends.

To address that significant challenge, the company’s founders say they’re pursuing partners with global freight-forwarders to install HD video inspection stations. Presumably, high-speed internet connections will be an important component.

“Since our founding, the problem of trade fraud has grown at a staggering rate,” said HD Trade Services chief technical officer Daniel Sugarman in a statement today. “Last year, over 100 employees of the world’s leading B2B marketplace were caught aiding fraudsters. In addition to this, trade fraud was one of the main topics of this year’s State of the Union Address.”

“In terms of global trade, it comes down to trust. So I wonder if HD video is really the best way to create trust,” said David Friedberg, The Climate Corp., in an investor panel after the HD Trade Services presentation. Friedberg suggested that social networks might be a better way to vouch for a company’s trustworthiness.

The company was founded in 2011 by Sugarman and CEO Daniel Sperling-Horowitz, who has spent years researching international trade fraud. Sperling-Horowitz first ran into the issue when trying to import electronics from Alibaba.com, but was shocked to find many complaints from a supposedly trusted supplier. That spurred him on to make several trips to China to further investigate trade risk at its source.

Garden City, New York-based HD Trade Services currently has 5 employees and has raised $100,000 so far from Prime Transport.

HD Trade Services is one of 80 companies chosen by VentureBeat to launch at the DEMO Spring 2012 event taking place this week in Silicon Valley. After we make our selections, the chosen companies pay a fee to present. Our coverage of them remains objective.

Pani worked at a Hudson, Mass. Intel facility several years ago before leaving for a job at Advanced Micro Devices (AMD), Intel’s main rival. There were several days of overlap between both jobs, where Pani had access to Intel data while working for AMD. It was during this time that Federal prosecutors allege he stole valuable information about the manufacturing and design of Intel’s Itanium microprocessor. Federal agents found the stolen documents in Pani’s home.

Pani pled guilty to the charges in court on Friday. He could face up to 20 years in prison per fraud count when he is sentenced August 8.

Originally, the value of what Pani stole was estimated at $1 billion at least. However, prosecutors now say Intel has valued the secrets to be worth between $200 million and $400 million.

AMD apparently never used the data Pani obtained, which investigators say was uncovered before Pani could use it. AMD spokesperson Drew Prairie told Reuters that “the FBI has stated that there is no evidence that AMD had any involvement in or awareness of Mr. Pani’s alleged actions.”

Computer criminal image via Shutterstock

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Researchers are working on an on/off switch for the next generation of credit cards. No, not to stop you from spending money you shouldn’t, but to help protect you from theft and fraud.

Credit cards are moving away from magnetic strips to more modern, no-contact technology. Now, with radio frequency identification (RFID) chips or near-field communication (NFC) cards, you can just wave your credit card in front of a reader to quickly pay for a cup of joe.

However, this ease could open up the doors for a new type of criminal. In theory, shady characters with portable scanners can read the information off your RFID card by getting close enough to you that your card is in their reader’s electromagnetic field. This type of theft hasn’t taken off yet, due to clunky technology and minimal monetary gain (most RFID and NFC cards have low spending caps), but an on/off trick could be a smart preventative step.

Researchers at the Pittsburgh Swanson School of Engineering are working on a simple new technology that would require customers to place their finger on the card to turn it “on” when they pay. When you place your finger on a specific spot on the card, say a logo or icon, it would complete a circuit and enable readers to charge the card. If the circuit isn’t complete, the card’s NFC or RFID technology would be disabled.

“Our new design integrates an antenna and other electrical circuitry that can be interrupted by a simple switch, like turning off the lights in the home or office,” explains professor Marlin Mickle in a statement. “The RFID or NFC credit card is disabled if left in a pocket or lying on a surface and unreadable by thieves using portable scanners.”

The extra step would take very little time for the customer, and researchers think the technology would be fairly easy and inexpensive for credit card companies to adopt. They recently filed a patent application for the on/off card technology.

37signals, for those of you not familiar with the inner workings of the machine we call the Internet, is a web shop founded by Ruby on Rails creator DHH (short for David Heinemeier Hansson) and Jason Fried.

In terms of UI leadership and thought leadership, especially around startups, it is without doubt one of the more influential brain trusts in the web community.

In other words, not the most low-profile place from which to nab a little “inspiration.”

Evidence shows that not only did the Curebit team copy 37signals; they’re serving some assets right from 37signals’ original site. Click the images to see larger versions:

Check out these designs, code, and assets from Highrise, a 37signals product, and from Curebit:

In a Hacker News comment thread, one of the Curebit founders insists the whole thing was a big mistake — the team was just testing and slipped, fell, and landed on 37signals’ work.

“Were A/B testing different pages, came across the 37signals post, and were like, ‘Wow, we should see how that converts!’” wrote Curebit co-founder Allan Grant.

“We… did not really think through the implications of what we were doing. We just kind of thought about it as a fun test to run.

“Clearly it was stupid.”

Yes, clearly.

Ironically, a 6-month-old blog post from 37signals about A/B testing reads, “What works for us may not work for you. Please do your own testing. Your conversion rates may suffer if you copy us.”

Your conversion rates or, you know, your credibility and integrity and the ability to have lunch in Silicon Valley ever again.

On Twitter, some of the Internet’s more colorful personalities are currently battling it out in a war of colorful words. After the discovery, DHH called the Curebit team “fucking scumbags” and Grant himself “a person of poor moral character.”

Grant fired back with a series of defensive tweets, finally telling DHH, “It’ll all be ok. Chill dude.” Probably not the best response to a famously irascible and fairly prominent character. Dude.

DHH then unleashed on Grant, saying, “I can’t believe you keep digging. For every [asinine] excuse, you’re making the original act an order of magnitude worse.

“There is no valid way to rip off people’s designs and have it be ok. Not ‘We’re small;’ not ‘We’re A/B testing.’”

To McClure, the startup’s leading investor in a recent $1.2 million round of funding, DHH writes, “Yo, is your money no good at Curebit? Because it doesn’t seem to be able to buy them decency or designers.”

McClure says he is “speaking to [Grant] about it.”

We’re willing to file this story under “lean startup wankery,” folks. Founders, take note: No matter how many corners you cut and no matter how small your team is, you still have to spend time and money on development and design. Yes, even when you’re testing. Otherwise, you will be publicly spanked and have your startup card revoked by some BDFL or other.

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PSN users slapped Sony with a class-action lawsuit in July after hackers broke into the network and stole sensitive information about more than 100 million PSN and Station.com users — possibly including credit card numbers. The lawsuit cited some confidential witnesses who claim Sony’s network security was inadequate and vulnerable to attacks. Users cannot log into the PSN without agreeing to the new terms of service.

The new clause reads, “any Dispute Resolution Proceedings, whether in arbitration or court, will be conducted only on an individual basis and not in a class or representative action or as a named or unnamed member in a class, consolidated, representative or private attorney general action.”

That means individuals can still sue the company over breaches of privacy like what happened in the massive PSN hack. And PSN users can still opt out of that part of the terms of service by mailing a letter to the company’s offices in Los Angeles, Calif.

“This updated language in the terms of service is designed to benefit both the consumer and the company by ensuring that there is adequate time and procedures to resolve disputes,” a Sony spokesperson told VentureBeat. “There is also a section of the terms of service that educates users on how they can opt out of this portion of the terms of service.”

Sony finally brought its beleaguered online gaming network back online nearly a month after hackers were able to break in. Sony laid indirect blame for the PSN’s downtime on hacktivist group Anonymous, which typically rallies a group of loosely connected hackers under moral or political banners. (You can see a timeline for the PlayStation Network outage here.) Lulz Security, another rogue hacking group, also broke into Sony Pictures and compromised more than 1 million accounts.

Sony’s online network is a critical service that competes with Microsoft’s Xbox Live online gaming service — as well as other online gaming services. There are also 948 games now available in the PlayStation Network store, as well as 4,000 pieces of add-on content for games.

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GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

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That future isn’t too far away, thanks to the advent of cloud-based gaming services like Otoy, OnLive and Gaikai.

Cloud-based gaming companies run video games on very powerful remote computer servers and then stream the game like a YouTube video to a computer. If a gamer has a half-decent Internet connection, they won’t notice a difference in quality between playing on a remote cloud server or using their own computer or a home console to power a game.

If those companies have their way, gaming will only exist in the cloud in the future.

“We’ll be there in 10 years — if that,” said OnLive’s CEO Steve Perlman (pictured above).

That means that hard copies of games and digital downloads will become a thing of the past, along with retail stores like GameStop. And because they only live in the cloud, it will be almost impossible to steal those games and distribute them on the Internet for free.

Currently it’s not that difficult to “crack” a copy of an existing game — like, say, Call of Duty: Black Ops — and create an “image” of the game for a tech-savvy gamer. Individuals can then distribute that image across the Internet, and anyone can play the game for free if they have the proper software to run the image. It’s even easier to steal games for mobile devices. Stealing games for the iPhone is a little more difficult, because gamers will have to jailbreak their phones, but Android users don’t even have to do that.

“Piracy in the mobile space is rampant, it’s 90 plus percent for something like Angry Birds,” said Rob Wyatt (pictured below), chief scientist at Otoy — another cloud gaming provider. “It’s even easier for games built on WebGL and HTML5 — every texture, shader and asset is loaded as a separate file, so it’s easy to find the file and download it.”

It’s especially true internationally, where game piracy runs rampant. Angry Birds is one of the most pirated game in China, said Rovio’s head of global brand advertising Wibe Wagemans. International companies also have a tendency to “rip off” content and art from those games because it’s easy to break into a game and modify the content, he said. Those developers then publish a very similar game and distribute it, and usually end up making a good bit of money, he said.

Cloud gaming companies had a chance to come to prominence thanks to the recession, Wyatt said. The recession tightened the budgets of gamers everywhere, and that delayed the advent of the next console generation, he said. Had the recession not happened, the PlayStation 4 would be here by now. Wyatt would know, too, as he helped develop both the Xbox and the PlayStation 3.

“That next generation is seriously in doubt, both boxes are pretty much the same feature set,” he said. “I don’t think there’s much need for a next-generation console — you’re going to have one box, and you play it on any device like a television or a tablet.”

There are two ways those services can charge gamers to play video games. They can require gamers to pay the full price for a game — like you would in a video game store like GameStop — or pay a monthly subscription like other online games like World of Warcraft. OnLive, for example, does a mix of both: A large number of the games fall under a subscription while the newest titles require gamers to pay the full price.

The games industry has been pretty civil about hunting down video game pirates.  Activision Blizzard, which employs the IP Cybercrime investigation firm, has opted to issue warnings first, for example. The tactics are different from those used by the Recording Industry Association of America, the organization that represents music labels, in cracking down on music pirates. The RIAA’s tactics are much tougher, and the organization has been vilified for going after music fans and suing them relentlessly.

Cheating in online games will also become a thing of the past with cloud gaming, Wyatt said. Most online games are populated with a small group of people who use “man in the middle” attacks, which compromise a packet headed to a game’s server that makes the character do something different. That can speed up a character’s movement or make them instantly get a headshot without having to aim.

“Because it’s in the cloud, you can’t access the network,” he said. “Spoofing packets is nearly impossible because of the speed of the transmission and because all the computing happens at the other end.”

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GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

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The number of home console owners with Sony’s PlayStation 3 rose to 44 percent, up from 40 percent in the month before Sony was forced to bring the network down.

One of the titles in the welcome back package, a sandbox super hero adventure game called inFamous, jumped to the most-owned game by PlayStation 3 owners, according to the report. But a lot of gamers — myself included — already own those Triple-A titles that Sony gave away.

The number of players who said they bought a game off the PSN rose to 17 percent in June, up from 13 percent in March before the network was taken down, according to the report.

Sony finally brought its beleaguered online gaming network back online nearly a month after hackers were able to break in. The company laid indirect blame for the PSN’s downtime on hacktivist group Anonymous, which typically rallies a group of loosely connected hackers under moral or political banners. Anonymous has denied that it was involved in breaking into and bringing down the PSN.

The network was offline for 24 days. PlayStation 3 and PlayStation Portable owners were unable to download new content for their games and play online with other players. The downtime came at a critical time for two major releases for Sony’s PlayStation 3 — Portal 2 and Mortal Kombat, both of which prominently featured online play and had received a good deal of critical acclaim.

Sony’s online network is a critical service that competes with Microsoft’s Xbox Live online gaming service — as well as other online gaming services. There are also 948 games now available in the PlayStation Network store, as well as 4,000 pieces of add-on content for games. VentureBeat previously published a timeline for the PlayStation Network outage. You can view the full video of Sony Chief Executive Kazuo Hirai detailing the return of the PSN at the PlayStation blog.

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GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

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The lawsuit follows a massive attack on Sony’s online gaming networks, the PlayStation Network (PSN) and Station.com. Hackers broke into the network and stole sensitive information about more than 100 million PSN and Station.com users — including potentially credit card numbers. The lawsuit cites some confidential witnesses that claim Sony’s network security was inadequate and vulnerable to attacks.

Sony finally brought its beleaguered online gaming network back online nearly a month after hackers were able to break in. Sony laid indirect blame for the PSN’s downtime on hacktivist group Anonymous, which typically rallies a group of loosely connected hackers under moral or political banners. Anonymous has denied that it was involved in breaking into and bringing down the PSN.

The network was offline for 24 days. PlayStation 3 and PlayStation Portable owners were unable to download new content for their games and play online with other players. The downtime came at a critical time for two major releases — Portal 2 and Mortal Kombat, both of which prominently featured online play and had received a good deal of critical acclaim.

Sony offered PSN users free games and a whole batch of other welcome-back goodies — like free subscriptions to the company’s premium PlayStation Plus version of the PSN — to entice players to continue using the PSN. The packages will probably appease a large number of console and handheld gaming device owners. But a lot of gamers — myself included — already own those Triple-A titles, and find they aren’t really worth as much as they used to be.

Sony’s online network is a critical service that competes with Microsoft’s Xbox Live online gaming service — as well as other online gaming services. There are also 948 games now available in the PlayStation Network store, as well as 4,000 pieces of add-on content for games. VentureBeat previously published a timeline for the PlayStation Network outage. You can view the full video of Sony Chief Executive Kazuo Hirai (pictured above) detailing the return of the PSN at the PlayStation blog.

We’ll be exploring the most disruptive game technologies and business models at our third annual GamesBeat 2011 conference, on July 12-13 at the Palace Hotel in San Francisco. It will focus on the disruptive trends in the mobile games market. GamesBeat is co-located with our MobileBeat 2011 conference this year. To register, click on this link. Sponsors can message us at sponsors@venturebeat.com.

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GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

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Advocates of Bitcoin, the open-source digital currency that’s easy to anatomize and difficult to duplicate, were quick to point out that Bitcoin — just like paper money — is only as secure as the place you store it.

The digital currency is stored in an unencrypted wallet file, but Bitcoin users can take measures to improve the security of their investment.

“If there was a means to invalidate the thieves’ coins or to reclaim them, then the same could be done to a legitimate user. Bitcoin is a secure system only so long as you keep your wallet secured — and sadly it seems you were not able to adequately do so,” one forum post pointed out, adding that “this isn’t a reason to abandon bitcoin completely or to dismiss it as flawed, but of course it’s understandable that you wouldn’t want to reinvest after having lost so much.”

It’s unlikely that a person would be able to recover the stolen investment, since Bitcoin isn’t recognized by a national government. The U.S. government is even seeking legal action against those that use Bitcoin. At the very least, the thieves could be prosecuted for illegally compromising another person’s property and taking their possessions.

While Bitcoin may ultimately prove to be a bad investment, it can still be used as a means to an end –  purchasing goods and services that are illegal with a large degree of anonymity.

However, people are tracking the market value of Bitcoin now more than ever. StockTwits, the Twitter for business, recently created a Bitcoin trading symbol ($BCOIN) to make it easier to track.

Sony laid indirect blame for the intrusion and PSN outage on Anonymous yesterday, saying that its defenses were down while it fended off a denial of service attack by Anonymous, which left the doors open for other hackers to come in and steal sensitive information. Anonymous hit Sony with the denial of service attack after the company went after hacker George Hotz, who reverse engineered the PlayStation 3 to run unauthorized programs.

“If a legitimate and honest investigation into credit card theft is conducted, Anonymous will not be found liable,” the group stated in a press release.

In a letter to Congress earlier today, Sony said that it found a file labeled “anonymous” with a fragment of the hacktivism group’s slogan — “we are legion.” That prompted the company to label Anonymous at least partially responsible for an attack that brought down its online gaming network and resulted in hackers stealing sensitive information about 100 million PSN and Station.com users.

“While we are a distributed and decentralized group, our ‘leadership’ does not condone credit card theft,” the group stated in a press release. “We are concerned with the erosion of privacy and fair use, the spread of corporate feudalism, the abuse of power and the justifications of executives and leaders who believe themselves immune personally and financially for the actions they undertake in the name of corporations and public office.”

It’s true that the theft does not fit the modus operandi of Anonymous, which is usually concerned with disrupting companies that get in the way of free speech and political causes. But it’s important to note that Anonymous does not directly deny involvement in the attack on the PSN in the announcement — it only denies involvement in the credit card and information theft. While the group might not possess the same public relations prowess as Sony, it’s unusual that the group hasn’t made this announcement airtight and outright denied involvement entirely for the intrusion.

Unknown hackers attacked the PSN on April 19, forcing the Japanese company to bring down the network, which has more than 77 million registered users. The nightmare then continued after hackers broke into the company’s Station.com site, which serves as a host for its PC games like Everquest. Hackers were able to steal information from as many as 24.6 million accounts on that site, according to Sony. In all, more than 100 million accounts might have been compromised. The PlayStation Network is a critical service that competes with Microsoft’s Xbox Live online gaming service — as well as other online gaming services. There are also 948 games now available in the PlayStation Network store, as well as 4,000 pieces of add-on content for games.

You can find a timeline for the Playstation Network outage and credit card information theft scandal here, courtesy of VentureBeat’s gaming guru Dean Takahashi. You can also find a full copy of the press release below.

We’ll be exploring the most disruptive game technologies and business models at our third annual GamesBeat 2011 conference, on July 12-13 at the Palace Hotel in San Francisco. It will focus on the disruptive trends in the mobile games market. GamesBeat is co-located with our MobileBeat 2011 conference this year. To register, click on this link. Sponsors can message us at sponsors@venturebeat.com.

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GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

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In my 21 years of startups, I had my ideas “stolen” twice. The first time it happened, it was no big deal. The other, it was serious.

Before I start that tale, a disclaimer: This is not legal advice. It’s not even advice. It’s just a story about what happened to me that you might be able to learn from.

We were starting Epiphany, my last company. I was out and about in Silicon Valley doing what I would now call Customer Discovery trying to understand how marketing departments in large corporations worked. The initial hypothesis for Epiphany (from my much smarter partner Ben Wegbreit) was that as departments in the enterprise (manufacturing, finance, customer support sales) became automated, the marketing department would eventually get its turn.

I remember presenting our ideas for marketing automation to one VP of Marketing in a large Silicon Valley company. His enthusiastic response was, “This will revolutionize marketing departments!” He continued: “I’d like to convince my boss so our company can be your first customer.” I should have been suspicious when he said, “I’d like to take a copy of your presentation to show him.” Caught up in the enthusiasm of hearing what a great idea we had, I violated one of my cardinal rules, and left him a hard copy.

Fast forward nine months. After talking to tons of customers and almost as many VC’s, we got Epiphany funded as a company that was going to automate Marketing Departments. After a ton of unreturned phone calls, I had written off the enthusiastic VP of Marketing who wanted to show my slides to his boss and moved on with building our company.

By now we had found a few customers and learned a lot more about the market from them and other prospects. Our business model changed as we realized that to become a large company, we needed to automate more than just a few marketers. As we were out looking for our Series B round, our company had gotten the attention of a big VC firm who wanted a play in enterprise software.

Are These Your Slides?
During the due-diligence process, I sat down with one of the partners who pulled out a set of slides and asked me: ”Have you seen these?”  I quickly leafed through them and replied, “Sure they’re our original slides. Why?” He said, “Look again.” They had all my words from a year ago, but hey wait a minute, there’s someone else’s logo on my slides?! What’s going on?  He said, “That’s what we’re trying to figure out.  These guys just got funded, and they sound a lot like you guys.”

Luckily I had the original slides and could prove who came first. Still the fact was a competitor had raised money using our idea and our slide deck.

And who was this competitor? The same VP of Marketing whom a year earlier had wanted a hard copy of our slides. He was now CEO of a new company in our market.

I felt like I had just been kicked in the stomach.

My cofounders and I went through the stages of disbelief, anger, resignation and acceptance. Here was a competitor who had appropriated our idea and gotten funded. (Welcome to the Internet bubble.) There was lots of venting as we talked about lawsuits and issuing nasty press releases.

We consciously didn’t ask potential customers to sign a Non-Disclosure Agreement (NDA). In Customer Discovery we were learning as much from them as they did from us. And we figured that unless litigation was going to be our business strategy, NDAs would have inhibited the back-and-forth that made us smarter.

We concluded that, at least for us in this market, an NDA would be a bigger impediment than asset. Now we started asking ourselves, “Did we make a mistake?  Would have getting a signed confidentially agreement deterred this person?” On further reflection (and their track record since), not in the least – but that still left us with a problem. What should we do about this competitor copying our strategy?

Finally, we concluded, “You can’t drive forward by looking in the rear-view mirror.”

Our competitor was executing on hypotheses we had developed 9 months ago, and their strategy remained static. We on the other hand, had moved on. We had discovered detailed information about what customers really needed and wanted and turned our original hypotheses into facts. We had validated our new assumptions by a set of orders, and we had pivoted on our business model. Our original idea had been nothing more than an untested set of hypotheses. Truth be told, we were no longer the company in those stolen slides.

While the common wisdom said that our success was going to be determined by which company executed better, the common wisdom was wrong. In a startup success isn’t about just execution, it’s how well we could take our original hypothesis and learn, discover, iterate and execute.

Never Get Even, Get Ahead
With a set of orders from brand name customers, we had growing confidence that we had achieved product/market fit. We were within three months of formally announcing our company and products at a major industry trade show. We made sure our competitor knew this. In fact, we made sure they knew what day at the show we were going to announce. Just as we predicted, they picked the day before us for their announcement in an effort to preempt our company launch with theirs. We made sure they heard how shocked and upset we were that they were going to beat us to an announcement in our market.

Our competitor announced on a Monday solidifying their position in the small market we had abandoned because we realized it was unprofitable and would not scale. We announced the next day, positioned as a player in a much larger and broader market with new positioning, strategy and customers. Our copycat competitor was now publicly locked into a company and product strategy that was obsolete and untenable.

Over the next two years we left them in the dust.

Ultimately, how you iterate and execute your idea is more important than the idea itself. Your business concept is not a company. Lots of people have ideas. Typically they are just a set of untested hypotheses.

Successful companies are about the learning, discovery, iteration on your initial ideas. If someone can do a better job iterating hypotheses and executing than you can, you deserve to fail.

No business plan survives first contact with customers. The real value is finding the product/market fit.  And that’s not found in a set of slides.