Google invests in Taiwanese maker of Glass components

Google appears to be preparing to ramp up production of its Google Glass product with an investment in a Taiwanese chip maker that manufactures components used in the wearable device.

Google will buy shares to hold a 6.3 percent interest in Himax Display, a subsidiary of Himax Technologies, the Taiwanese company said on Monday.

The investment will fund production upgrades and expand capacity at Himax Display's facilities that make liquid crystal on silicon (LCOS) chips. These chips are typically found in projectors, but are also used in the head-mounted display for Google Glass. Since this year's second quarter, the company had already begun expanding capacity to meet demand for its LCOS products.

"Himax Display has been a great partner for several years now," Google said in an email. "This investment is an extension of this partnership, which we hope will allow the team to continue to develop their operations."

The investment comes just as Google plans to launch its wearable glasses device later this year in the U.S. With the product, users can make searches, check email, and take photos through voice commands.

Earlier this year, the company made its device available to a select group of customers, but at the steep price of US$1,500. Google's deal with HiMax Display, however, could help the company reduce the costs of manufacturing the product.

Google is reportedly using Taiwan's Hon Hai Precision Industry, also known as Foxconn, to assemble the devices in the U.S.

HiMax Technologies, founded in 2011, is a semiconductor maker that specializes in display imaging processing technologies. The deal with Google will close in this year's third quarter.

Cryptocat encryption app maker apologizes, swats bug

The founder of an eavesdropping-resistant instant messaging application called Cryptocat has apologized over a now-fixed bug that made some types of messages more vulnerable to snooping.

Cryptocat, which runs inside a web browser, is an open-source application intended to provide users with a high degree of security by using encryption to scramble messages. But Cryptocat warns that users should still be very cautious with communications and not to trust their life with the application.

The vulnerability, found by Steve Thomas, affected group chats and not private conversations, said Nadim Kobeissi, in an interview from Germany Friday. The encryption keys used to encode those conversations were too short, which in theory made it easier for an attacker to decrypt and read conversations.

The error was the result of an oversight spotted by Thomas, Kobeissi said. The encrypted conversations were still carried over SSL (Secure Sockets Layers), another overlay of encryption. But if an attacker broke the SSL encryption and had the underlying encrypted chats, "it would be significantly easier to crack" using brute-force techniques, he said.

The bug was fixed in Cryptocat versions 2.0 and up about a month ago after Thomas notified the project. The vulnerability persisted for about seven months between September 2012 and April.

Although Cryptocat noted the patch in its changelog, Kobeissi wrote a detailed blog post on July 4 explaining the issue after Thomas published a sharp critique.

"This is a really difficult situation," Kobeissi said. "I am not a person who will gloss over this kind of bug for absolutely no reason just to maintain the image of the project."

The bug was completely unacceptable, but it is common for errors to be revealed in open-source projects, he said. Kobeissi said he gave Thomas a $250 reward out of his own pocket even though Cryptocat has no formal bug bounty program.

"I wanted to be on the record that he was paid for his effort," Kobeissi said.

Cryptocat has seen surging interest since the U.S. National Security Agency's surveillance program was detailed by whistleblower Edward Snowden. Kobeissi said Cryptocat saw 65,000 new users in just a month since the revelations were published. (See also "How to protect your PC from Prism.")

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Brick maker in Harrisville closes doors

HARRISVILLE — A Top of Utah company that has been making bricks for nearly 30 years is now out of business, and the company’s president has filed a lawsuit against Zions Bank, claiming its actions led to the closure.

The suit, which was filed June 18 in 3rd District Court in Salt Lake City, alleges that Zions Bank stonewalled Interpace Industries Inc. on a line of credit that was being negotiated between the two parties and prematurely terminated another line — actions that prevented the brick maker from meeting certain manufacturing deadlines and paying its employees.

Heidi Prokop, communications manager with Zions Bank, said it’s the bank’s policy not to comment on pending litigation.

A privately held, family-run company, Interpace was founded in 1984 and is located at 736 W. Harrisville Road. Although ownership has changed several times, brick has been made at the Harrisville Interpace site since 1888.

An article about the opening of the plant from an 1888 issue of the Ogden Standard said it was “the largest brick factory west of St. Louis.”

Interpace President Jon Rhine said that at its peak, the plant employed 60 people and produced about 24 million bricks each year, which were shipped all over North America.

The suit says the global recession that began in 2009 caused Interpace’s business to suffer greatly, but the company survived hard times and began to rebound in 2012.

Throughout the crisis, Interpace had four commercial loans with Zions and other banks and a revolving line of credit for $400,000 with Zions that was used for operating expenses.

In December 2011, Interpace told the bank it needed to repackage its loans with the various lenders, including Zions, into one credit facility. The suit alleges that Zions agreed to work with Interpace and began negotiating the new credit facility.

In spring 2012, based on assurances from Zions that a deal was on the horizon, Interpace fired up its kiln after a winter of inactivity, which is typical in the brick industry, and began work on two major contracts to provide brick for an LDS church house and for Casper College in Wyoming.

Nearly three months after Zions sent Interpace a formal proposal, the bank had still not finished the deal, the suit claims.

Rhine says at that point, it was clear the new credit facility would not be approved by Zions and on June 6, 2012, he told Zions he was left with no choice but to shut down the facility and that he planned to do so by July 15, 2012.

Rhine told Zions he needed some time to shut down the facility in a proper manner, and he would need to continue to use the original $400,000 revolving line of credit to pay employees to help shut down the facility.

“We had a kiln that was in full production,” Rhine said. “And you need time to shut it down because it’s basically an enormous bomb. It’s a really technical process, and it could be disastrous if it isn’t done right.”

But on June 18, Rhine received an email from Zions, telling him they were shutting down the line of credit because of Rhine’s plan to close the business. Rhine says he was only given two days’ notice, and then the credit line was shut down.

Rhine told his employees that he wasn’t sure how they would get paid, but he needed their help to shut down the kiln. He said about half of his employees walked out, and the other half stayed to help retire the kiln.

Rhine said he eventually paid those employees through other means and safely shut down the kiln, but Interpace was unable to process the orders for the church and the college.

The lawsuit also claims Zions was under pressure to repay outstanding Troubled Asset Relief Program loans during the negotiations with Interpace, which wrongfully discouraged commercial lending. The suit states that Zions repaid a $700 million balance of TARP funds to the U.S. Treasury three months after it pulled Interpace’s line of credit.

The filings claim that Zions breached its “duty of good faith and fair dealing” with Interpace when it terminated the line of credit and only gave two days’ notice to do so.

Interpace is asking for $400,000 for breach of contract and other damages to be determined at trial.

Now, nearly a year after the shut-down process began, Interpace is in the final stages of closing down its Harrisville site for good.

The company’s 56,000-square-foot plant that houses the no-longer-functioning kiln has gathered dust and become home for several area pigeons. Unused brick still sits packaged in the yard behind the company’s main office.

Only two employees remain at Interpace, but they’ll be gone soon, too.

“I really don’t know exactly what I’m going to do,” said Ron Christensen, who has been working at the plant for 38 years. “I guess I’ll either try to reinvent myself or get another job in the masonry industry.”

Rhine has since sold the site and the land, but he says it won’t continue to function as a brick-manufacturing facility.

“It’s really a sad deal,” he said. “I don’t know if a lot of people knew about this place, but it was one of a kind. Brick has been made right here, in the Ogden area, for nearly 125 years, and now it’s all gone.”