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The sale of a second vulnerability did not go so well.

In January, Miller was approached by a friend who wanted to sell a flaw in Microsoft PowerPoint XP and 2003. Miller found very little guidance in the market to help him set a price, but he believed a company would pay up to $20,000 for the flaw and a government agency, perhaps $50,000.

In reality, he only had a handful of offers but haggled one company up to $12,000. Before he could close the deal, however, Microsoft released a fix for the issue. The delay and difficulty in finding a buyer and the problems in setting a price had essentially scuttled the deal, Miller said.

"I don't think it fair that researchers don't have the information and contacts they need to sell their research," Miller said.

Yet, TippingPoint's Forslof stressed that selling to the government is not necessary setting a fair price for a vulnerability. Legitimate markets include companies that use vulnerability information to protect their customers while they contact the vendor to get the issue fixed. The government generally constitutes a gray market, because they most likely are not going to notify the vendor and the researcher does not know how they are going to use the information. The black market, where the buyers are likely to use the vulnerability for illicit purposes, would likely pay the most money but put end users in the most jeopardy.

"There are a range of prices when you are talking about fair market value versus black market value," she said. "And the government is in a class of their own. It's a matter of what is going to happen to that vulnerability and how they are going to use it."

The answers to those questions drove one researcher to deal with a vulnerability-buying program rather than selling to a government agency.

Security researcher Aviv Raff found two trivial-to-exploit vulnerabilities in a component of the Windows Vista operating system late last year. He shopped the more critical flaw to a number of security companies as well as the two major vulnerability-purchase programs. While some of the security companies bested the offers from TippingPoint and iDefense, he declined to sell the flaw to them because they would not commit to notifying Microsoft of the issue.

For the same reason, selling the vulnerability to the government was out of the question as well.

"I wouldn't mind (selling the information to the government), if I knew they will report it to Microsoft," Raff said.

Because of the terms of the sale, Raff cannot mention the name of the program to which he sold the vulnerability nor the price at which he sold it, except to say it's much less than $80,000.

Raff directly notified Microsoft of the less critical of the two vulnerabilities. The software giant has not yet patched the flaws.

This article originally appeared in Security Focus.

Copyright © 2007, SecurityFocus

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