EMC's RSA unit contends with uproar over NSA allegations

|By:, SA News Editor

Reuters reports the NSA "arranged a secret $10 million contract" with EMC's RSA security hardware/software unit with the goal of creating an encryption backdoor that wound up being distributed via RSA's Bsafe cryptography libraries.

RSA denies entering into a secret contract, and says its "explicit goal has always been to strengthen commercial and government security." But the company doesn't deny taking money from the NSA. GigaOm: "So who’s telling the truth here? Potentially everyone (barring the NSA, of course)."

Several current/former RSA employees tell Reuters the company was misled by the government, which portrayed the random number-generation algorithm featuring the backdoor as a "secure technological advance." RSA urged its clients to stop using the algorithm in September, after the first reports of a backdoor emerged.

RSA has been a bright spot for EMC as the company deals with slumping storage hardware demand. RSA's sales rose 11% Y/Y in Q3 to $250M.