Spain scraps fibre deal linked to Huawei | Spammers profiting from Holocaust images | How Australia courted OpenAI
Plus, how the world’s biggest carmakers fell behind in software
Good morning. It's Monday, 1st of September.
The Daily Cyber & Tech Digest focuses on the topics we work on, including cybersecurity, critical technologies, foreign interference & disinformation.
Follow us on Bluesky, on LinkedIn, and on X.
The Spanish government has intervened at the eleventh hour to cancel a contract that would have boosted the use of Chinese tech giant Huawei’s fibre optic equipment across the country, citing “strategic autonomy”. South China Morning Post
An international network of spammers are posting AI-generated images of Holocaust victims on Facebook, an investigation into "AI slop" has found, tracking many of these images to the accounts of a network of Pakistan-based content creators who collaborate closely on how to make money on Facebook. BBC
OpenAI lab's path to Australia was not long and winding and followed sustained overtures from the Labor government and a deal with the nation's biggest company. Capital Brief
ASPI
🚀 We’re rebuilding ASPI’s China Defence Universities Tracker from the ground up. The major expansion adds richer profiles, rankings powered by the Critical Technology Tracker, new mapping of links to China’s state-owned defence industry, analysis of China–Russia research ties, and data on the surge in dual-use research centres—now covering 180+ entities with faster search. Be first to get early-access invites and launch updates: https://unitracker.aspi.org.au/
Australia
How Labor and CBA enticed OpenAI to Australian shores
Capital Brief
Daniel Van Boom and John Buckley
Earlier this month Labor's digital czar Andrew Charlton spent a week pitching AI giants on Australia as a locale for investment. As revealed by Capital Brief, one of those meetings was with OpenAI's chief operating officer Brad Lightcap. So it was not a shock to see OpenAI announce that it would be opening a Sydney office later this year. The US$300 billion startup cited that meeting in its press release, while Lightcap said in a statement that Australia's government was "already shaping the future of AI."
ChatGPT maker OpenAI to open first Australian office. The Australian Financial Review
Age verification trial greenlights Labor’s social media ban
The Australian
Jack Quail
Technology designed to check the age of social media users is effective and practical to implement, a government-backed trial has concluded, clearing the way for Labor to press ahead with its planned ban on children accessing such platforms. Under the restrictions slated to take effect on December 10, social media sites including TikTok, Snapchat, X, Instagram, Facebook and YouTube will be required to take “reasonable steps” to prevent children younger than 16 from creating or holding an account. The legislation is among the most stringent crackdowns on online platforms globally, and will impose steep fines valued at up to $49.5m against platforms that breach the ban.
NASA confirms moon ride for Aussie lunar Roo-ver
InnovationAus
David McClure
The US space agency NASA has confirmed that the Australian designed and build lunar rover known as ‘Roo-ver’ will hitch a ride to the moon through its Commercial Lunar Payload Services initiative. Roo-ver will be carried to the lunar surface on NASA’s CT-4, which is scheduled for liftoff “around the end of this decade”. The Australian Government is investing $42 million into the development, design, build and operation of Roo-ver.
Threads that bind: cables, community and Australia’s defence
The Strategist
Keith Wolahan
In November, a single cargo ship severed critical undersea cables in the Baltic Sea. For hours, parts of Europe went digitally dark. Australia faces the same vulnerability. We depend on just 12 major cables for 99 percent of our international internet traffic. Cut enough of them, and we’re isolated faster than any naval blockade could achieve. But this is about more than wires in the ocean. The same forces that threaten our cables also seek to erode the social bonds that make us a nation worth defending.
China
China has a different vision for AI. It might be smarter.
The Wall Street Journal
Josh Chin and Raffaele Huang
In China, leader Xi Jinping has recently had little to say about artificial general intelligence. He is pushing the country’s tech industry to be “strongly oriented toward applications”—building practical, low-cost tools that boost China’s efficiency and can be marketed easily. Tsinghua University, China’s equivalent of the Massachusetts Institute of Technology, is rolling out an AI-powered hospital, where human doctors will be assisted by virtual colleagues armed with the latest data on diseases. The Chinese government’s enthusiasm for more-practical uses of AI is visible in Xiong’an, Xi’s built-from-scratch dream city two hours south of Beijing.
Alibaba creates AI chip to help China fill Nvidia void
The Wall Street Journal
Raffaele Huang and Tracy Qu
Chinese chip companies and artificial-intelligence developers are building up their arsenal of homegrown technology, backed by a government determined to win the AI race with the US. China’s biggest cloud-computing company, Alibaba, has developed a new chip that is more versatile than its older chips. Previous cloud-computing chips developed by Alibaba have mostly been designed for specific applications. The new chip, now in testing, is meant to serve a broader range of AI inference tasks.
USA
US Homeland Security chief reports breach at FEMA, fires 23 employees
Reuters
U.S. Department of Homeland Security Secretary Kristi Noem said on Friday that there had been an IT breach at the Federal Emergency Management Agency, the American disaster response agency that has been buffeted by deep cuts and is slated for elimination. Noem's statement gave few specifics about the nature of the breach except to blame FEMA's staff, two dozen of whom she said she had fired. Noem said the hack threatened "the entire Department and the nation as a whole" but at the same time said that "no American citizens were directly impacted."
AI is unmasking ICE officers. Can Washington do anything about it?
POLITICO
Alfred Ng
Dominick Skinner, a Netherlands-based immigration activist, estimates he and a group of volunteers have publicly identified at least 20 ICE officials recorded wearing masks during arrests. He told POLITICO his experts are “able to reveal a face using AI, if they have 35 percent or more of the face visible.” ICE says its agents need to wear masks to prevent being unfairly harassed for doing their jobs. To their critics, agents in masks have become a potent symbol of unaccountable government force. The masking, and the counter-campaign to identify agents, has prompted a crossfire of bills on Capitol Hill.
US makes it harder for SK Hynix, Samsung to make chips in China
Reuters
Karen Freifeld
The United States is making it more difficult for chipmakers Samsung and SK Hynix to produce chips in China by revoking authorizations that allowed the companies to receive American semiconductor manufacturing equipment there, according to the Federal Register. The U.S. Commerce Department had given the companies exemptions to sweeping restrictions created in 2022 on the sale of U.S. semiconductor equipment to China. The companies will now need to obtain licenses to buy the equipment for China.
Americas
Growing use of deadly drones by Colombian militants terrifies residents
NBC News
Colin Sheeley and Sara Mhaidli
Seventeen videos posted on social media and verified by NBC News show that these groups, the National Liberation Army and dissidents from the Revolutionary Armed Forces of Colombia, are using drones for surveillance, intimidation and bombing campaigns — targeting rival groups, soldiers, police and civilians across the country, injuring and killing dozens in the past year. Militants have focused their assaults on areas where they already possess greater control: in Catatumbo, a region of dense jungle bordering Venezuela, and Cauca, on Colombia’s west coast, notorious for its smuggling routes in the Pacific Ocean.
North Asia
Modi, Ishiba visit Tokyo Electron facility to deepen semiconductor ties
Nikkei Asia
Kiran Sharma
The visit to Sendai highlighted the complementarity between India's growing semiconductor manufacturing ecosystem and Japan's strengths in advanced semiconductor equipment and technology, the ministry statement said. The visit came a day after the two sides announced Japan's aim to invest $68 billion in India over the next decade, an agreement perhaps spurred by global trade disruptions caused by U.S. President Donald Trump's "reciprocal" tariffs. Analysts see the deepening chip cooperation between India and Japan as significant, given that semiconductors are becoming more crucial in the manufacturing of automobiles, telecommunications equipment and electronic products -- and play key roles in automation industries.
Southeast Asia
Bytedance's TikTok temporarily suspends live feature in Indonesia following protests
Reuters
Stefanno Sulaiman
"In light of the increasing violence in protests in Indonesia, we are taking additional security measures to keep TikTok a safe and civil space. As part of this measure, we are voluntarily suspending the TikTok Live feature for the next few days in Indonesia," TikTok said. TikTok added it will continue to remove content that violates its community guidelines. TikTok has more than 100 million accounts based in Indonesia.
Broken $100 billion dream city becomes refuge for tech utopians
Bloomberg
Ryan Weeks
In a hotel-turned-campus on a reclaimed island in Malaysia, crypto and tech entrepreneurs are building software, chomping down Australian prime ribeye, hitting the gym — and getting schooled in a radical blueprint for creating new sovereign states from scratch. They have descended on Forest City to attend Network School, the brainchild of former Coinbase executive and The Network State author Balaji Srinivasan. In this troubled megaproject once envisaged to house some 50 times its current population, they’re conducting a real-life experiment of sorts with Srinivasan’s vision of “startup societies” defined less by historical territory than shared beliefs in technology, cryptocurrency and light regulation.
South & Central Asia
India's MPL to sack 60% of local staff after paid gaming ban, source says
Reuters
Aditya Kalra
Prime Minister Narendra Modi's government this month banned online paid games, citing financial and addiction risks especially among youth, leading to a shutdown of many gaming apps offering paid fantasy cricket, rummy and poker games. The law shocked an Indian industry backed by venture capital firms such as Tiger Global and Peak XV Partners that was set to be worth $3.6 billion by 2029. MPL and rival Dream11 became popular in recent years by offering paid fantasy cricket games that allow winners to receive financial prizes.
Corruption and control: How Turkmenistan turned internet censorship into a business
Tor Project
Since its beginning, the Internet in Turkmenistan has always been restricted and censored. A new report from Turkmen.news revealed that agents from the Cybersecurity Department were selling paid VPNs and and offering IP whitelisting-services they themselves were restricting for the general public. They weren't just profiting from internet repression; they were creating the demand. In an Orwellian twist, the people blocking access to the internet are the same ones secretly selling it back, at a price most Turkmens can't afford. After the exposé, Turkmen officials even attempted to pay for the article's removal.
Ukraine – Russia
Serhii Sternenko: ‘Russia has repeatedly tried to kill me – I must be doing something right’
The Australian
Anthony Loyd
Many men wish death upon Serhii Sternenko. Four times in seven years assassins have tried to take the life of the Ukrainian social influencer and drone supplier whose outspoken views on war, culture and governance have earned him a following of millions in his country – and enemies near and far. Nationalist, activist, streetfighter, social influencer, lawyer, YouTuber and one of the main non-state suppliers of first-person view suicide drones to Kyiv’s army, Sternenko has become the best-known military blogger in Ukraine, an influential voice with more than two million subscribers on the video-sharing site and a further 852,000 followers on Telegram.
Europe
Spain cancels fibre-optic service contract involving use of Huawei equipment
South China Morning Post
Finbarr Bermingham
The €10 million contract had been greenlit by the relevant public utility on Monday, only for Spain’s digital transformation ministry to move at the last minute to nix it, El Pais reported, for “reasons of digital strategy and strategic autonomy”. Madrid had been under fire from Brussels and Washington for doubling down on its usage of Huawei equipment despite the EU asking its member states to remove the company from their 5G networks, citing security concerns.
Macron vows retaliation if Europe’s digital sovereignty attacked
Bloomberg
Richard Bravo
French President Emmanuel Macron vowed a strong response if any country takes measures that undermine Europe’s digital sovereignty. The US President Donald Trump threatened to impose fresh tariffs and export restrictions on countries that have digital services taxes or regulations that harm American tech companies. France was among the first nations to implement a digital services tax. The EU may need to reassess its trade arrangement with the US if Trump follows through on his threats related to digital services.
UK
BBC reveals web of spammers profiting from AI Holocaust images
BBC
Kristina Völk and Kevin Nguyen
An international network of spammers are posting AI-generated images of Holocaust victims on Facebook, a BBC investigation into "AI slop" has found. The BBC has tracked many of these images to the accounts of a network of Pakistan-based content creators who collaborate closely on how to make money on Facebook. They are gaming Meta's content monetisation program, an "invite-only" system which pays users for high-performing content and views. Meta does not intentionally encourage users to post false stories, including about the Holocaust, but its system rewards posts with high engagement. The BBC has also found AI slop accounts based in India, Vietnam, Thailand, and Nigeria.
Steam users in the UK will need a credit card to access ‘mature content’ games
The Verge
Tom Warren
Valve has started to comply with the UK’s Online Safety Act, by rolling out a requirement for all Brits to verify their age with a credit card to access “mature content” pages and games on Steam. UK users won’t even be able to access the community hubs of mature content games unless a valid credit card is stored on a Steam account. Meanwhile platforms like Reddit, Bluesky, and Discord have opted for age verification checks using selfies.
Big Tech
Musk's xAI sues engineer for allegedly taking secrets to OpenAI
Reuters
Blake Brittain
Elon Musk's artificial intelligence startup xAI has sued a former engineer at the company for allegedly stealing trade secrets related to its Grok chatbot and taking them to rival OpenAI. Musk's company said in the complaint in California federal court that Xuechen Li stole confidential information related to "cutting-edge AI technologies with features superior to those offered by ChatGPT" to bring to his new job at OpenAI earlier this month. The new lawsuit said Li began working as an engineer for xAI last year, where he helped train and develop Grok. The company said Li took its trade secrets in July, shortly after accepting a job from OpenAI and selling $7 million in xAI stock.
Amazon disrupts APT29 watering hole campaign abusing Microsoft device code authentication
The Hacker News
Ravie Lakshmanan
Amazon on Friday said it flagged and disrupted what it described as an opportunistic watering hole campaign orchestrated by the Russia-linked APT29 actors as part of their intelligence gathering efforts. APT29, also tracked as BlueBravo, is the name assigned to a state-sponsored hacking group with ties to Russia's Foreign Intelligence Service In recent months, the prolific threat actor has been linked to attacks leveraging malicious Remote Desktop Protocol configuration files to target Ukrainian entities and exfiltrate sensitive data.
Google set to face modest EU antitrust fine in adtech investigation, sources say
Reuters
Foo Yun Chee
Google is set to face a modest EU antitrust fine in the coming weeks for allegedly anti-competitive practices in its adtech business, three people with direct knowledge of the matter said. The decision by the European Commission follows a four-year long investigation triggered by a complaint from the European Publishers Council that subsequently led to charges in 2023 that Google allegedly favours its own advertising services over rivals. The modest fine will mark a shift in new EU antitrust chief Teresa Ribera's approach to Big Tech violations from predecessor Margrethe Vestager's focus on hefty deterrent penalties.
Artificial Intelligence
A troubled man, his chatbot and a murder-suicide in Old Greenwich
The Wall Street Journal
Julie Jargon and Sam Kessler
As Stein-Erik Soelberg became increasingly paranoid this spring, he shared suspicions with ChatGPT about a surveillance campaign being carried out against him. Everyone, he thought, was turning on him: residents in his hometown of Old Greenwich, Conn., an ex-girlfriend—even his own mother. At almost every turn, ChatGPT agreed with him. To Soelberg, a 56-year-old tech industry veteran with a history of mental instability, OpenAI’s ChatGPT became a trusted sidekick as he searched for evidence he was being targeted in a grand conspiracy.
The child-safe smartphone that’s ‘incompatible with porn
The Australian
Tim Biggs
A new smartphone from Finnish company HMD, creators of most recent Nokia phones, is designed for kids and teens and has a unique selling point: it promises to be entirely pornography-proof. Using an on-device AI filter that works in all apps and that users are unable to circumvent, it prevents the display and capture of nude images, and will delete any files containing nude images.
Misc
‘Full of bugs’: how the world’s biggest carmakers fell behind in software
Financial Times
Kana Inagaki, Harry Dempsey and David Keohane
A decade ago, when Toyota began hiring dozens of experts from Google and other tech giants to pivot its development efforts from hardware into artificial intelligence and software, hype and expectations were sky high. In the years that followed, the world’s largest carmaker by volume nurtured ambitions to create a centralised computer system that could control everything from the transmission, brakes, steering and door locks to assisted driving and infotainment functions.
Events & Podcasts
The Sydney Dialogue 2025
The Australian Strategic Policy Institute is pleased to announce the Sydney Dialogue, the world’s premier policy summit for critical, emerging and cyber technologies, will return on 4-5 December. Now in its fourth year, the dialogue attracts the world’s top thinkers, innovators and policymakers, and focusses on the most pressing issues at the intersection of technology and security. TSD has become the place where new partnerships are built among governments, industry and civil society, and where existing partnerships are deepened.
‘Geopolitical gaslighting’: Hybrid threats expert Elisabeth Braw on Iran, Russia and the new gig economy for bad guys
Stop the World
Australia made international headlines when it revealed Iran had directed at least two antisemitic attacks in Australia using local criminals as proxies. In response, the Australian Government expelled Iran’s Ambassador, the first time we have done so since WW II. While this sort of activity is new for Australia, it fits a growing pattern in Europe where Russia and to some extent Iran have been using this tactic of hiring what are in effect gig workers to carry out such sabotage operations against other countries. To discuss hybrid threat activities and explain this tactic of using disposable agents, Davd Wroe speaks to Elisabeth Braw, senior fellow with the Atlantic Council’s Transatlantic Security Initiative in the Scowcroft Center for Strategy and Security.
The Daily Cyber & Tech Digest is brought to you by the Cyber, Technology & Security Programs team at ASPI and supported by partners.
