Critical infrastructure

Microsoft hacking campaign expands into ransomware attacks

A state-aligned cyber-espionage campaign exploiting Microsoft server software vulnerabilities has escalated to ransomware deployment, according to a Microsoft blog post published late Wednesday.

The group, dubbed ‘Storm-2603’ by Microsoft, is now using the SharePoint vulnerability to spread ransomware that can lock down systems and demand digital payments. This shift suggests a move from espionage to broader disruption.

according to Eye Security, a cybersecurity firm from the Netherlands, the number of known victims has surged from 100 to over 400, with the possibility that the true figure is likely much higher.

‘There are many more, because not all attack vectors have left artefacts that we could scan for,’ said Eye Security’s chief hacker, Vaisha Bernard.

One confirmed victim is the US National Institutes of Health, which isolated affected servers as a precaution. Reports also indicate that the Department of Homeland Security and several other agencies have been impacted.

The breach stems from an incomplete fix to Microsoft’s SharePoint software vulnerability. Both Microsoft and Google-owner Alphabet have linked the activity to Chinese hackers—a claim Beijing denies.

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US lawmaker proposes to train young Americans in AI for cyberwarfare

In a Washington Post opinion piece, Rep. Elise Stefanik and Stephen Prince, CEO of TFG Asset Management, argue that the United States is already engaged in a new form of warfare — cyberwarfare — waged by adversaries like China, Russia, and Iran using tools such as malware, phishing, and zero-day exploits. They assert that the US is not adequately prepared to defend against these threats due to a significant shortage of cyber talent, especially within the military and government.

To address this gap, the authors propose the creation of the United States Advanced Technology Academy (USATA) — a tuition-free, government-supported institution that would train a new generation of Americans in cybersecurity, AI, and quantum computing. Modelled after military academies, USATA would be located in upstate New York and require a five-year public service commitment from graduates.

The goal is to rapidly develop a pipeline of skilled cyber defenders, close the Pentagon’s estimated 30,000-person cyber personnel shortfall, and maintain US leadership in strategic technologies. Stefanik and Prince argue that while investing in AI tools and infrastructure is essential, equally critical is the cultivation of human expertise to operate, secure, and ethically deploy these tools. They position USATA not just as an educational institution but as a national security imperative.

The article places the academy within a broader effort to outpace rivals like China, which is also actively investing in STEM education and tech capacity. The authors call on the President to establish USATA via executive order or bipartisan congressional support, framing it as a decisive and forward-looking response to 21st-century threats.

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Meta tells Australia AI needs real user data to work

Meta, the parent company of Facebook, Instagram, and WhatsApp, has urged the Australian government to harmonise privacy regulations with international standards, warning that stricter local laws could hamper AI development. The comments came in Meta’s submission to the Productivity Commission’s review on harnessing digital technology, published this week.

Australia is undergoing its most significant privacy reform in decades. The Privacy and Other Legislation Amendment Bill 2024, passed in November and given royal assent in December, introduces stricter rules around handling personal and sensitive data. The rules are expected to take effect throughout 2024 and 2025.

Meta maintains that generative AI systems depend on access to large, diverse datasets and cannot rely on synthetic data alone. In its submission, the company argued that publicly available information, like legislative texts, fails to reflect the cultural and conversational richness found on its platforms.

Meta said its platforms capture the ways Australians express themselves, making them essential to training models that can understand local culture, slang, and online behaviour. It added that restricting access to such data would make AI systems less meaningful and effective.

The company has faced growing scrutiny over its data practices. In 2024, it confirmed using Australian Facebook data to train AI models, although users in the EU have the option to opt out—an option not extended to Australian users.

Pushback from regulators in Europe forced Meta to delay its plans for AI training in the EU and UK, though it resumed these efforts in 2025.

Australia’s Office of the Australian Information Commissioner has issued guidance on AI development and commercial deployment, highlighting growing concerns about transparency and accountability. Meta argues that diverging national rules create conflicting obligations, which could reduce the efficiency of building safe and age-appropriate digital products.

Critics claim Meta is prioritising profit over privacy, and insist that any use of personal data for AI should be based on informed consent and clearly demonstrated benefits. The regulatory debate is intensifying at a time when Australia’s outdated privacy laws are being modernised to protect users in the AI age.

The Productivity Commission’s review will shape how the country balances innovation with safeguards. As a key market for Meta, Australia’s decisions could influence regulatory thinking in other jurisdictions confronting similar challenges.

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EU and Japan deepen AI cooperation under new digital pact

In May 2025, the European Union and Japan formally reaffirmed their long-standing EU‑Japan Digital Partnership during the third Digital Partnership Council in Tokyo. Delegations agreed to deepen collaboration in pivotal digital technologies, most notably artificial intelligence, quantum computing, 5G/6G networks, semiconductors, cloud, and cybersecurity.

A joint statement committed to signing an administrative agreement on AI, aligned with principles from the Hiroshima AI Process. Shared initiatives include a €4 million EU-supported quantum R&D project named Q‑NEKO and the 6G MIRAI‑HARMONY research effort.

Both parties pledge to enhance data governance, digital identity interoperability, regulatory coordination across platforms, and secure connectivity via submarine cables and Arctic routes. The accord builds on the Strategic Partnership Agreement activated in January 2025, reinforcing their mutual platform for rules-based, value-driven digital and innovation cooperation.

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AI energy demand accelerates while clean power lags

Data centres are driving a sharp rise in electricity consumption, putting mounting pressure on power infrastructure that is already struggling to keep pace.

The rapid expansion of AI has led technology companies to invest heavily in AI-ready infrastructure, but the energy demands of these systems are outstripping available grid capacity.

The International Energy Agency projects that electricity use by data centres will more than double globally by 2030, reaching levels equivalent to the current consumption of Japan.

In the United States, they are expected to use 580 TWh annually by 2028—about 12% of national consumption. AI-specific data centres will be responsible for much of this increase.

Despite this growth, clean energy deployment is lagging. Around two terawatts of projects remain stuck in interconnection queues, delaying the shift to sustainable power. The result is a paradox: firms pursuing carbon-free goals by 2035 now rely on gas and nuclear to power their expanding AI operations.

In response, tech companies and utilities are adopting short-term strategies to relieve grid pressure. Microsoft and Amazon are sourcing energy from nuclear plants, while Meta will rely on new gas-fired generation.

Data centre developers like CloudBurst are securing dedicated fuel supplies to ensure local power generation, bypassing grid limitations. Some utilities are introducing technologies to speed up grid upgrades, such as AI-driven efficiency tools and contracts that encourage flexible demand.

Behind-the-meter solutions—like microgrids, batteries and fuel cells—are also gaining traction. AEP’s 1-GW deal with Bloom Energy would mark the US’s largest fuel cell deployment.

Meanwhile, longer-term efforts aim to scale up nuclear, geothermal and even fusion energy. Google has partnered with Commonwealth Fusion Systems to source power by the early 2030s, while Fervo Energy is advancing geothermal projects.

National Grid and other providers invest in modern transmission technologies to support clean generation. Cooling technology for data centre chips is another area of focus. Programmes like ARPA-E’s COOLERCHIPS are exploring ways to reduce energy intensity.

At the same time, outdated regulatory processes are slowing progress. Developers face unclear connection timelines and steep fees, sometimes pushing them toward off-grid alternatives.

The path forward will depend on how quickly industry and regulators can align. Without faster deployment of clean power and regulatory reform, the systems designed to power AI could become the bottleneck that stalls its growth.

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UK proposes mandatory ransomware reporting and seeks to ban payments by public sector

The UK government has unveiled a new proposal to strengthen its response to ransomware threats by requiring victims to report breaches, enabling law enforcement to disrupt cybercriminal operations more effectively.

Published by the Home Office as part of an ongoing policy consultation, the proposal outlines key measures:

  • Mandatory breach reporting to equip law enforcement with actionable intelligence for identifying and disrupting ransomware groups.
  • A ban on ransom payments by public sector and critical infrastructure entities.
  • A notification requirement for other organisations intending to pay a ransom, allowing the government to assess and respond accordingly.

According to the proposal, these steps would help the UK government carry out ‘targeted disruptions’ in response to evolving ransomware threats, while also improving support for victims.

Cybersecurity experts have largely welcomed the initiative. Allan Liska of Recorded Future noted the plan reflects a growing recognition that many ransomware actors are within reach of law enforcement. Arda Büyükkaya of EclecticIQ praised the effort to formalise response protocols, viewing the proposed payment ban and proactive enforcement as meaningful deterrents.

This announcement follows a consultation process that began in January 2025. While the proposals signal a significant policy shift, they have not yet been enacted into law. The potential ban on ransom payments remains particularly contentious, with critics warning that, in some cases—such as hospital systems—paying a ransom may be the only option to restore essential services quickly.

The UK’s proposal follows similar international efforts, including Australia’s recent mandate for victims to disclose ransom payments, though Australia has stopped short of banning them outright.

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Trump AI strategy targets China and cuts red tape

The Trump administration has revealed a sweeping new AI strategy to cement US dominance in the global AI race, particularly against China.

The 25-page ‘America’s AI Action Plan’ proposes 90 policy initiatives, including building new data centres nationwide, easing regulations, and expanding exports of AI tools to international allies.

White House officials stated the plan will boost AI development by scrapping federal rules seen as restrictive and speeding up construction permits for data infrastructure.

A key element involves monitoring Chinese AI models for alignment with Communist Party narratives, while promoting ‘ideologically neutral’ systems within the US. Critics argue the approach undermines efforts to reduce bias and favours politically motivated AI regulation.

The action plan also supports increased access to federal land for AI-related construction and seeks to reverse key environmental protections. Analysts have raised concerns over energy consumption and rising emissions linked to AI data centres.

While the White House claims AI will complement jobs rather than replace them, recent mass layoffs at Indeed and Salesforce suggest otherwise.

Despite the controversy, the announcement drew optimism from investors. AI stocks saw mixed trading, with NVIDIA, Palantir and Oracle gaining, while Alphabet slipped slightly. Analysts described the move as a ‘watershed moment’ for US tech, signalling an aggressive stance in the global AI arms race.

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Ransomware activity drops 43% in Q2 despite year‑on‑year rise

Ransomware incidents fell sharply in Q2 2025, with public disclosures dropping 43% from Q1 (from 22.9 to 17.5 cases per day). However, attacks remain elevated compared to the same quarter last year, showing a 43% year‑on‑year increase. In total, 1,591 new victims appeared on leak sites, confirming ransomware is still a serious and growing threat.

This decline coincided with law enforcement disruption of major operations such as Alphv/BlackCat and LockBit, alongside seasonal lulls like Easter and Ramadan. Meanwhile, active ransomware groups surged to 71, up from 41 in Q2 2024, indicating a fragmented threat landscape populated by smaller actors.

North America continued to absorb over half of all attacks, with healthcare, industrial manufacturing, and business services among the most affected sectors. Although overall volume dipped, newer threat actors remain agile, and fragmentation may fuel more covert ransomware behaviour, not less.

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UK to retaliate against cyber attacks, minister warns

Britain’s security minister has warned that hackers targeting UK institutions will face consequences, including potential retaliatory cyber operations.

Speaking to POLITICO at the British Library — still recovering from a 2023 ransomware attack by Rysida — Security Minister Dan Jarvis said the UK is prepared to use offensive cyber capabilities to respond to threats.

‘If you are a cybercriminal and think you can attack a UK-based institution without repercussions, think again,’ Jarvis stated. He emphasised the importance of sending a clear signal that hostile activity will not go unanswered.

The warning follows a recent government decision to ban ransom payments by public sector bodies. Jarvis said deterrence must be matched by vigorous enforcement.

The UK has acknowledged its offensive cyber capabilities for over a decade, but recent strategic shifts have expanded its role. A £1 billion investment in a new Cyber and Electromagnetic Command will support coordinated action alongside the National Cyber Force.

While Jarvis declined to specify technical capabilities, he cited the National Crime Agency’s role in disrupting the LockBit ransomware group as an example of the UK’s growing offensive posture.

AI is accelerating both cyber threats and defensive measures. Jarvis said the UK must harness AI for national advantage, describing an ‘arms race’ amid rapid technological advancement.

Most cyber threats originate from Russia or its affiliated groups, though Iran, China, and North Korea remain active. The UK is also increasingly concerned about ‘hack-for-hire’ actors operating from friendly nations, including India.

Despite these concerns, Jarvis stressed the UK’s strong security ties with India and ongoing cooperation to curb cyber fraud. ‘We will continue to invest in that relationship for the long term,’ he said.

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Major hack hits Dutch Public Prosecution Service

The Dutch Public Prosecution Service (OM) had confirmed a significant cyberattack that forced it to disconnect from the internet, following warnings of a potential vulnerability.

Internal systems were cut off after the National Cybersecurity Centre alerted OM to the risk, with officials saying the disconnection could last for weeks.

OM’s IT director, Hans Moonen, described the breach as massive and dramatic. He stated that reconnection is impossible until it’s confirmed that the intruder has been completely removed from the network.

The organisation has reported the incident to the police and the Dutch Data Protection Authority.

Since Wednesday evening, staff have been working around the clock to contain the damage and investigate the breach. Although internal communication remains functional, external emailing is no longer possible, significantly impacting operations.

According to OM crisis team member Marthyne Kunst, the disruption means the agency relies heavily on printed documents again, adding a logistical burden to the already tense situation.

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