LONDON, March 13: An escalating war of claims and counter-claims between two of the world’s top media groups provides a glimpse into digital cable theft, a crime that requires technical expertise and ample financing.

Canal Plus Technologies, the television arm of Vivendi Universal, alleges that British technology firm NDS Group Plc amassed a “sophisticated and well-funded effort” to intercept its code in 1999 and publish it online.

This, Canal Plus alleges in a US lawsuit, triggered a wave of cable television theft that cost Canal Plus more than one billion dollars in damages.

NDS, controlled by Rupert Murdoch’s News Corporation, has vigorously denied the allegations as baseless, saying it would file a counterclaim.

The suit, filed in a California district court on Monday, is sending shockwaves through media and technology circles as industry observers come to grips with allegations that one of their own may have engaged in a form of high-tech sabotage.

Cable companies have lived with conventional cable theft for decades, but industry champions have hailed digital cable services as nearly theft-proof.

“CATCHING LIGHTNING IN A BOTTLE”: Digital cable set-top boxes and the smart cards needed to read the digital broadcast signals contain multiple layers of protection. Cracking the code to get at the card’s programming is akin to “catching lightning in a bottle,” one security expert put it.

“Hacking a smart card is not a garage activity any more,” said Neil Barrett, technical director for British security firm Information Risk Management. “It’s very, very difficult — it’s an activity that requires extensive trial testing, sophisticated lab equipment and lots of money.”

In the California lawsuit, Canal Plus Technologies alleged the theft was the work of trained technicians working long hours to extract its copyright-protected technology.

“NDS devoted its substantial corporate resources to sabotage C+ Technologies’ technological security measures engineered into its smart cards — a sophisticated and well-funded effort,” the French group alleged.

Digital cable smart cards are designed with internal booby traps. If the card is tampered with in any way, it is designed to erase all data contained on its chips.

To avoid setting off the code-wiping command, a code cracker needs to preserve the card, either by dipping it in liquid nitrogen or exposing it to powerful microwaves, Barrett said.

The cracker then must move quickly to extract the entire source code plus the encryption keys needed to decipher it. One false step in the retrieval process will wipe out the data and render the card unreadable.

“You are playing a game of beat the clock,” said Barrett.

Industry officials are unable to make an accurate estimate of the financial impact of the theft of digital cable, a relatively young business.

But one source at a British cable company said that up to 50 million pounds’ (70.5 million dollars) worth of analogue cable programming is pilfered in the UK each year.

Digital cable set-top boxes are designed to be uncrackable, but as Canal Plus alleges, code-breakers with enough funding and technology can infiltrate the system and create an all-too-familiar headache for the cable industry.

“If this were to happen across the board, we would lose our revenue overnight,” the cable source said.—Reuters