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Magistrate Adds Premeditation to Charges Against Oscar Pistorius; Duchess of Cambridge Appears at Hope House; China Denies Hacking Allegations; New Report Says Chinese Army Behind Hacker Attacks; 'Leading Women': Angeliki Frangou, Daniela Mercury; Oscar-Nominated Documentary Partly Shot on iPhone

Aired February 19, 2013 - 08:00:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


KRISTIE LU STOUT, HOST: I'm Kristie Lu Stout in Hong Kong. And welcome to News Stream where news and technology meet.

Now the case against Oscar Pistorius is mapped out in court as friends and family gather for the funeral of the woman he is accused of murdering.

A new report blames the Chinese military for a series of hacking attacks.

And the royal baby bump revealed: the pregnant Duchess of Cambridge makes a public appearance. And for once, all eyes were on something other than her wardrobe.

The charge against Oscar Pistorius has been upgraded to premeditated murder. The said that he could not exclude the possibility that the sport's star planned the shooting death of his girlfriend Reeva Steenkamp.

Now Pistorius, he arrived at court in Pretoria in this van on Tuesday morning. And inside, prosecutors argued that Pistorius, quote, "shot and killed an innocent woman."

Now the state says Pistorius armed himself, put on his prosthetic legs and fired four times into the bathroom through the door hitting Steenkamp three times and killing her. The defense team argued that Pistorius shot her thinking that she was a burglar. And in a statement read in court by his lawyer, Pistorius denied he had any intention to killer.

And as the drama unfolded in the courtroom, funeral services for Reeva Steenkamp were held in her hometown of Port Elizabeth in South Africa. Now Nkepile Mabuse is there. She joins us now live.

Nkepile, this is a private service today in her hometown. What can you tell us?

NKEPILE MABUSE, CNN INTERNATIONAL CORRESPONDENT: Kristie, as you can imagine, it was an extremely difficult and emotional morning for the friends and family of Reeva Steenkamp. Her body was cremated at this crematorium behind me, Victoria Park in the seaside town of Port Elizabeth. And then her family and friends held a ceremony for around 45 minutes where they honored her, remembered her, many describing her as an angel, somebody who loved people and who people loved back.

After the service, her uncle and her brother came out, a few other family members to speak to the media just thanking people for their support. Her uncle broke down. He started out very strong, but later broke down. And this is what Reeva's brother, Adam, had to say.

(BEGIN VIDEO CLIP)

ADAM STEENKAMP, REEVA STEENKAMP'S BROTHER: I won't say very much. There's a space missing inside all the people that she knew that can't be filled again. We're going to keep all the positive things that we remember and know about my sister. And we will try and continue with the things that she tried to make better. We'll miss her.

(END VIDEO CLIP)

MABUSE: And Kristie, I asked a couple of people who knew Reeva, some people who had known her since she was very little, whether she said anything about being troubled in the lead up to her death. And a lot of people said, you know, even if she had trouble in her life, Reeva was not the kind of person who wanted to discuss negative things. She always wanted to be happy is what a lot of people told me here, Kristie.

LU STOUT: And many of her friends and family there paying tribute to her and her life. Are they also, her friends and family, revealing anything about a possible motive in the shooting? Anything at all?

MABUSE: You know, I spoke to a man who has worked for Reeva's father for many, many years. And he says that he asked Reeva's father if there were any signs. I mean, why would his daughter die in such a brutal fashion? And Reeva's father, according to this man, said that Reeva was happy. So they all just want answers. And those answers, of course, will come hopefully out of the Pretoria magistrate's court as this case unfolds in front of the world's media, Kristie.

LU STOUT: And on the same day of this emotional farewell to Reeva, Oscar Pistorius, the man who killed her, he was back in court. How is South Africa just reacting to all of this?

MABUSE: Do you know, ever since this story broke, every single day brings with it new revelations, new allegations. And I think South Africans are so overwhelmed by what is coming out of the court, what the media is revealing. Oscar Pistorius was a huge star in South Africa. He proved the impossible. The first double amputee ever to compete in the able-bodied Olympics. Young and old looked up to him. He was a hero.

And one commentator actually said that, you know, we don't know how to feel. We are lost, because our hero has fallen -- Kristie.

LU STOUT: A nation is shocked. Nkepile Mabuse reporting live from Port Elizabeth. Thank you.

Now it is a dramatic fall from grace for Oscar Pistorius who runs with carbon fiber blades owning him the nickname The Blade Runner. He is celebrated for being the first double amputee to compete in the Olympics, making it to the semifinals of the 400 meter race. He also broke the Paralympic record to win the men's 400 meter T44 race. Now the Athlete has a total of eight Paralympic medals, six of them gold.

And his case has sent shockwaves around South Africa and created a media frenzy outside the courtroom earlier today.

Now let's go live now to Robyn Curnow who is in Pretoria. And Robyn, tell us more about the statement from Oscar Pistorius that was read allowed earlier today, what he was saying about the moments before Steenkamp died.

ROBYN CURNOW, CNN INTERNATIONAL CORRESPONDENT: Hi there. Well, you know, everybody has been waiting for this moment, some justification -- the reasons why she was shot. This was Oscar's opportunity to tell his side of the story and many people in that courtroom and who read that statement and heard that statement, you know, couldn't help but be moved by what he describes as a terrifying night.

He said he woke up. It was pitch dark. He heard sounds in the bathroom. He thought perhaps a burglar had crawled through the window in the bathroom. He said he didn't have his prosthetic legs on, that he managed to hobble with on his stumps and that he had picked up his 9 millimeter gun, which he keeps under his bed, because he said he felt nervous about the crime rates.

He shot into this bathroom door. And as he did that he says he yelled to Reeva who he thought was still sleeping in bed. It was only then, he says, that he realized she wasn't in bed. And that's when he bashed down the door and picked her up, carried her downstairs. And he said she died in his arms.

LU STOUT: And Robyn, despite that account from Oscar Pistorius, he is facing a very serious charge, a charge of premeditated murder. Can you tell us more about how the case will play out on both sides, the defense and prosecution, and more short-term will he be released on bail?

CURNOW: Well, for the moment he's going to be spending tonight in jail again. The case has adjourned for the day. But what is important to note that in the morning session, this premeditated murder clause was added. The magistrate said he couldn't rule out that it was premeditated murder. The state actually very confident that they felt he had actually planned and thought about this, that he had very significantly and slowly picked up his gun and gone and shot into this bathroom door. They said if it was an intruder, why would an intruder lock the bathroom door?

You know, it's these kinds of questions that are going to be, you know try -- they're going to try and pick holes in Oscar defense. He only responded after lunch with this tale, with this story that's a very emotional account, terrifying account of what he said happened that night.

In terms of what happens next, we're back at court tomorrow for the rest of this bail application, but the fact that the magistrate has ruled that he is not ruling out premeditation means that there is the onus on the defense, on Oscar's team, to prove exceptional circumstances. The question is -- the words we heard from Oscar today, will they sway the magistrate? Are those exceptional circumstances? Is he moved by that? Does he believe it?

So definitely more drama, more emotion in court tomorrow.

LU STOUT: Oscar Pistorius returned to court today. You were inside the courtroom, how did he appear to you?

CURNOW: Yeah. You know, I was about a meter, meter and a half away from him. And he barely could contain himself. He sobbed. He cried. He put his hands into his head every time Reeva's name was mentioned. He really didn't seem to be dealing with it very well. I spoke to Oscar's uncle during one of the breaks. And I said, you know, Oscar is tough. He's fine, isn't he? He goes, no, he's not so tough.

And I really get a sense that Oscar is struggling with this. And this is -- if you can see behind me, Oscar's brother's just walked by and you can see them, the frenzy, the media frenzy following him.

Oscar's brother, I don't know if you caught sight of that, was right behind his brother throughout this court process. And he often puts his hand on his brother's shoulder and just left it there as sort of a support as Oscar cried into a tissue.

And, you know, I got the sense this family was one that was trying to come together at the end. They all prayed. They cuddled together.

But Oscar left and went into those holding cells. And I must say, that sound of a key turning in a -- in the bars in a jail, you can hear it going clank. And I heard it as he walked out. And I thought, you know, we have no idea what's going on in Oscar's head. And of course we must remember at this time Reeva Steenkamp whose funeral it was today.

LU STOUT: Well, Robyn, you've been giving us some very, very gripping detail from inside the courtroom there. Robyn Curnow joining us live from Pretoria, thank you so much.

And to this story now, a team of thieves in Belgium, they got away with $50 million in diamonds. This happened at Brussels Airport on Monday. And police say eight mass gunmen in two vehicles, they breach a security gate. They drove up to a passenger plane and they stole the precious stones from the cargo hold.

Now the diamonds, they were being transported from Antwerp, Belgium to Zurich, Switzerland. And a spokesman for the Brussel's Airport says it took the robbers just three minutes to take the diamonds.

Now there is much more to cover right here on News Stream. Up next, a U.S. computer security company says another world power is sponsoring hackers. We'll tell you who is being accused of cyber crimes.

And the duchess of Cambridge has made her first public appearance of the year. We will have a live report from London and see if the public got what it was waiting for.

And we will see different ways in which digital technology is being applied to this year's Oscar nominated movies. Stick around.

(COMMERCIAL BREAK)

LU STOUT: Welcome back.

Now a new report says China's army controls some of the world's most prolific computer hackers. Now that claim, it comes from the U.S. based cyber security firm Mandiant. It says it tracked hacking activity to an area near Shanghai, specifically to a building used by a secret division of the Chinese military. Now the report, it also includes video said to show actual cyber attacks conducted by the group. Now Mandiant says it observed the hackers for six years.

Now it calls the group APT1. It stands for Advanced Persistent Threat. Mandiant says APT1 targeted organizations in all the countries highlighted here on the map. It counted 141 victims, but did not name them. An overwhelming majority of them are in the U.S. And I'll be speaking to Mandiant's vice president about this report a little bit later in this show.

But now, let's go to China when the foreign ministry is again rejecting the hacking allegations. David McKenzie joins us now live from CNN Beijing. And David, some serious allegations in this report, tell us about them and how Beijing is responding.

DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: Well, definitely serious allegations. This is not your average hacker sitting in the bottom of a basement somewhere trying to get into your email account, this is according to Mandiant, at least, a well coordinated multi-year, tens, even hundreds of people involved. They say they are sponsored, as it were, directly linked with the government and specifically coordinated by the People's Liberation Army, the army of China, and coordinated about that by here in Beijing by the authorities.

Of course, the authorities here are denying all of this. They say that the claims are, quote, baseless. Interestingly, though, Kristie, they did come at a press conference today and say very specifically that it's not just the U.S. that is a victim of hackers, they pointed the finger in the other direction.

(BEGIN VIDEO CLIP)

HONG LEI, CHINESE FOREIGN POLICY SPOKESMAN (through translator): We implement strong law enforcement on cracking down on these activities. China is also a victim of hackings and cyber attacks. And the number of attacks has been increasing on a yearly basis. According to figures from Chinese authorities, 14 million Chinese computers were attacked by 73,000 IP addresses from abroad. Most of these cyber attacks come from the United States.

(END VIDEO CLIP)

MCKENZIE: Well, Kristie, you know, interesting they go into so much detail, that's pretty unusual for the ministry of foreign affairs, to in a way acknowledge the Mandiant's claims by making a counterclaim, as it were. This is definitely not the end of the story. What is interesting, these industries many of them would be considered a national security interest industry. The vast majority of them were in the United States, more than 100 of them in the aerospace, high tech industries as well as unrelated industries that you would think governments or hackers would want to get into.

The point of this, says Mandiant, was to go in there and largely steal information, particularly intellectual property that might be useful for the hackers. And they say those hackers are sponsored by the Chinese government -- Kristie.

LU STOUT: Yeah. And David, you said it, it is unusual for the Chinese government to be so specific in their comment. I mean, is this a very, very sensitive subject for them?

MCKENZIE: It is a very sensitive subject, for sure, Kristie. And also you must remember some weeks ago there was an incident of this reporting by a variety of newspapers about the link between Chinese government officials and their families wealth and how maybe families of Chinese government officials were benefiting because of their links to government, essentially stories on corruption. In particular, the New York Times said that because of those stories they were hacked as well as The Wall Street Journal and other newspaper outlets.

Now they are so sensitive about this that earlier today when we were reporting on this issue, Kristie, they blacked out CNN's signal to this region, or certainly to China. That shows just how how carefully they are monitoring both the reporting this situation as well as this overall issue. It certainly is a very serious allegation made by Mandiant, the security company, which the Chinese government denies. But security analysts overall say that cyber crime is one of the new frontiers in terms of combating both criminal enterprises as well as espionage enterprises that are often sponsored by governments -- Kristie.

LU STOUT: Now, China responding in multiple ways to this hacking report. David McKenzie joining us live from Beijing. Thank you.

Now U.S. government officials have grown increasingly concerned about cyber attacks. Now Mandiant's report, it comes one week after President Barack Obama signed an executive order to boost cyber security. Mr. Obama highlighted the effort in his State of the Union Address.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Earlier today, I signed a new executive order that will strengthen our cyber defenses by increasing information sharing and developing standards to protect our national security, our jobs and our privacy. But now congress must act as well by passing legislation to give our government a greater capacity to secure our networks and deter attacks. This is something we should be able to get done on a bipartisan basis.

(END VIDEO CLIP)

LU STOUT: And that call echoed one that he made back in July. Mr. Obama told congress to make cyber security a priority. And in his first term, President Obama appointed a national cyber security coordinator.

Now Russia's emergencies ministry has sent two planes to Syria to deliver humanitarian aid and pick up Russians who want to leave. The ministry says citizens of other former Soviet republics are also welcome to board. And Russia's defense ministry says four warships are also heading to the Mediterranean Sea near Syria, reportedly for a possible larger evacuation of Russian citizens.

Now not everybody has the option of leaving Syria, however. Now Frederik Pleitgen talked to one activist who has paid a heavy price for speaking out.

(BEGIN VIDEOTAPE)

FREDERIK PLEITGEN, CNN INTERNATIONAL CORRESPONDENT (voice-over): Zaidun Zoabi returned home to his family only recently. The human rights activist in Damascus says he spent almost a month in a regime detention center.

ZAIDUN ZOABI, HUMAN RIGHTS ACTIVIST: People within 48 hours or 72 hours are not really immune, then people lose mind. And one of the guys who was arrested with me lost his mind, in fact.

There is no oxygen, so I think this is one of the reasons. And then there is the detention you are in. And then there is the torture.

PLEITGEN: Zaidun says the conditions were so bad, he almost lost his life. And he believes lobbying efforts by UN special envoy to Syria Lakhdar Brahimi and reports on CNN help put pressure on authorities to free him.

ZOABI: On day 17, they brought me for interrogation, and they saw a ghost. And possibly because of what Mr. Brahimi has done to release me and what CNN did, too, I think they wanted to change my place. And they did. They got me some medicine, so I survived death by coincidence.

We are an ethical alternative to the regime. We will not copy any of the regime's bad practices. We will not ask for revenge. We want justice. We want life in face of the death culture. We want peace for all of us, even for the guys in the regime.

Just think of that. Does democracy harm them, those who are loyal to the government? Does democracy harm them? Does equal citizenship harm them? Does justice harm them?

PLEITGEN: Zaidun was arrested with his brother, Sohaib, who remains in custody about two months now with no charges and no information on his condition by the authorities.

UNIDENTIFIED GIRL: Daddy? Where are my uncle?

ZOABI: Your uncle is in jail.

He's just the most peaceful person and the most innocent person you could over meet. He's such a nice guy. Like my mother was telling me yesterday, anyone imagine he's wearing the same clothes for 57 days? She was crying, she was.

(WOMAN CRYING)

ZOABI: It's been 57 days.

PLEITGEN: Zaidun Zoabi says he is aware of the risks he's taking speaking with us. He believes he could be arrested again. But he says he will not hide and will not stop.

ZOABI: Freedom is that instinct that when it comes, you never let go. We can't stop now.

(CROWD CHANTING)

ZOABI: We will never stop until we get our freedom. We want to express ourselves freely. Is that a crime?

(CROWD CHANTING)

(END VIDEOTAPE)

LU STOUT: Fred Pleitgen reporting there.

You can read more about that family and their story on our website. It's also where you can find the very latest developments in Syria and its civil war. Just go to CNN.com/international.

News Stream will be right back.

(COMMERCIAL BREAK)

LU STOUT: Well, Hong Kong is fog city. An amazing view outside.

You're back watching News Stream.

And right here, this is a visual rundown of all the stories we're covering on the show today. We have covered Oscar Pistorius back in court. Later, we'll tell you why the manager of Arsenal made headlines with his comments at a news conference. But now it's one of the most eagerly awaited sights of the day, the Duchess of Cambridge and, yes, her baby bump.

Now this is her first official public appearance of the year. And Catherine paid a visit to one of the charities she supports. Now Hope House is a residential treatment facility in London. It's run by Action on Addiction. And she and her husband Prince William, they are expecting their first child in July.

Our royal correspondent Max Foster is outside Hope House. He joins us now. And Max, the duchess is back to work. And this is a charity visit, but of course the world is watching for a different reason.

MAX FOSTER, CNN INTERNATIONAL CORRESPONDENT: Yeah, exactly. It was the first official occasion, let me say, where you could see the bump. This is the first official bump picture, if you like. And there was a huge amount of press here I have to say, much bigger than normal. And that's just a sign of things to come, I think, as we head towards the birth in July.

So, she did appear and she didn't wear a coat. She did allow the bump to be visible. And that was calculated, I'm sure, to devalue any paparazzi shots with her pregnancy bump.

So, this was an occasion she cared a lot about. This is a charity she cares about. This is a safe house for addicted women who are coming off various addictions. And she had a nice time, I'm told, meeting people inside. And she was asked is she nervous about having a child. And she replied it would be unnatural if I wasn't. So it's certainly on her mind and a talkative conversation for her and everyone around the world, it seems, at the moment.

LU STOUT: Yeah, I like how you phrased that, this was a media event that was organized to devalue the paparazzi shot.

And this visit, you know, it just comes days after her pictures. I mean, the pictures of the pregnant duchess, they were seen in tabloids all over the world, pictures that were taken of her and William while taken on holiday. How do you think the royal family is reacting to that and managing the media glare? Are they, especially with this event, taking and being on the offensive now?

FOSTER: Well, the palace don't want any publications to use paparazzi shots. They -- William, Harry, the duchess, they all protect their privacy fiercely.

So the deal is that we get access to events like this and we don't have to rely on those paparazzi shots. They're trying to draw this line between public and private so they were very upset about those shots. But we've got a series of events now. She's going up to the north of England at the beginning of next month for a series of events that she plans. And you'll see the progression of the bump.

I mean, its fascinating to think that so many journalists and TV crews turned up today, but they did. There is a story here. The narrative that everyone is following, this is a future queen. He's going to give birth to the future monarch. And that's fascination.

But I have to say, Kristie, another big story here in the UK is this British author who really laid into the duchess, making comments and a lecture things like she's machine made. She's designed by committee. And David Cameron, the prime minister, has stepped in in the duchess's defense today saying that it's completely unfair to make these sorts of comments.

But, you know, everyone is talking about the duchess one way or another.

LU STOUT: Well, it's incredibly. David Cameron has stepped into the fray on that story. Max Foster reporting for us live from Hope House there in London. Thank you.

Now straight ahead, we will get more on this new report accusing China's military of sponsoring hacking attacks.

Also later here on News Stream, an Oscar nominated film from an iPhone? We'll explain why one movie maker turned to an app.

(COMMERCIAL BREAK)

KRISTIE LU STOUT, CNN ANCHOR: I'm Kristie Lu Stout in Hong Kong. You're watching NEWS STREAM, and these are the world headlines. A bail hearing for South African Olympian Oscar Pistorius has adjourned for the day and will resume on Wednesday. In a statement read by his attorney, Pistorius says he accidentally shot his girlfriend Reeva Steencamp, thinking that she was a burglar. The judge upgraded the charge against Pistorius to premeditated murder. Steencamp was killed on Valentine's Day. The funeral was held in Port Elizabeth a short time ago.

Biggest food company says it's been cut off in the horse meat scandal. That's in Bellup, Europe. And Nestle says it is taking some of its beef products off the shelves after finding traces of horse DNA in them. Nestle says the meat came from a German supplier.

Eight (ph) mass thieves have stolen $50 million worth of diamonds, the highest at Brussels Airport. Police say two vehicles were used to get away with polished and rough stones that were en route to Switzerland by plane. Now, spokesman for Brussels Airport says the heist took just three minutes.

Now, let's return to the alleged link between China's military and a prolific hacking group. Now, Mandiant, that's an American cyber security firm, says it came to that conclusion after six years of observations. Mandiant's new report says it believes that the group has been able to wage a long-running and extensive cyber espionage campaign because it gets support from Beijing. As for why it decided to publish the findings, Mandiant said this, quote, "It's time to acknowledge the threat is originating in China, and we wanted to do our part to arm and prepare security professionals to combat that threat effectively." Now, they go on to say this, "We are acutely aware of the risk this report poses for us. We expect reprisals from China as well as an onslaught of criticism."

Now with that, let's bring in Mandiant senior vice president Grady Summers joining us now live from Washington. Grady, thank you for joining us here on CNN. Your firm has said that it expects reprisals from China as a result of this report. I have to ask, have there been any reprisals?

GRADY SUMMERS, VP, MANDIANT: You know, we keep a constant vigilance on our networks, Kristie, we are constantly watching for attacks, and any security company like Mandiant is attacked on a constant basis. So we continue to keep an eye out, and we're watching vigilantly.

STOUT: OK, let's keep the focus on your report, then. Exactly who was doing the hacking and why?

SUMMERS: Well, what the report does is it details the massive cyber espionage campaign. As you said, it takes place over about six years. And the actors are group that we call Advance Persistent Threat 1, or APT-1. What's most significant, though, is we provide evidence that shows APT-1 is, in fact, a division of the Chinese People's Liberation Army, Unit 61398, based in the Pudang (ph) area of Shanghai.

STOUT: So the division of the Chinese army. Is the Chinese government aware of these attacks and the existence of this group?

SUMMERS: Well, we believe so. We know that the Chinese PLA is under the direct authority of the Communist Party of China. It's hard to believe that attacks of this scope, thousands and thousands of attacks, originating from one neighborhood in Shanghai, and part of the PLA would go without their notice. So, yes, we believe that the CPC is very aware of this.

STOUT: So, you believe Beijing is aware of APT-1 and is supporting what APT-1 is doing.

SUMMERS: Absolutely. And APT-1 is one of many threat groups that we track. We track about 75 threat groups, many of which have ties to China. APT-1 is probably the most prolific that we've seen, though.

STOUT: OK, now China has responded to your report. It has denied the hacking, and it's also questioned the validity of your report, saying that the hacking attacks are transnational and anonymous. What's your response to that?

SUMMERS: Our response is very simple, in that we provided all the evidence here. This is something our industry needs to do more of, so Mandiant is proud to participate in this kind of information sharing. We're not distributing a one-page statement here making some sort of baseless accusation. We're releasing 60 pages of evidence, over 3,000 technical indicators, everything from domain names, I.P. addresses, to the actual encryption certificates that the attackers use. So welcome the scrutiny. We invite other researchers to take a look at our evidence, and we think that they'll arrive to conclusions similar that we did, that these accusations are not at all baseless, that they are very well rooted in fact, and very prudent, actually.

STOUT: I also have to ask you about the timing of your report. "The New York Times" has also reported today that the U.S. government is planning to begin a more aggressive defense against Chinese hacking groups starting on Tuesday. Your report came out on Tuesday. Is this a coincidence, or is Mandiant working closely together with U.S. government?

SUMMERS: Yes, I believe it is a coincidence. This is something we've been working on for quite some time. We're really proud to be able to contribute to the national dialogue in that way. And we hope our report is useful for policy makers as the nation figures out how to confront this type of cyber espionage.

STOUT: OK, and back to you, the comments from Beijing and its reaction to the Mandiant report. Beijing also said that it is a victim of cyberattacks. With most of these attacks originating in the U.S. Have you discovered that to be true?

SUMMERS: All we know is that there are these cyber attacks that originate from every corner of the earth. The Internet is global, and crime is global. But it doesn't take away from the fact that we've got six years of evidence showing that a very particular type of cyber espionage originated from that one neighborhood in Shanghai, is indeed sponsored by the Chinese Communist Party. So, we agree with them that cyber attacks are everywhere, but we need to keep on looking at the facts that we've laid out in this report.

STOUT: OK. Cyber attacks are from everywhere, so you're not (inaudible) this report saying that this is asymmetric warfare, basically, China attacking the U.S. It's happening on both sides.

SUMMERS: Well, no, we are saying very clearly that this is asymmetric, that China is attacking the U.S. on a scale like we've never seen before. And we think it's important to keep that in mind.

STOUT: OK. And back to the allegations of hacking from China. APT-1, this unit, it stole hundreds of terrabytes of data. You didn't list the victims. Are you willing to share with us now who the victims are?

SUMMERS: No, not at all. We treat -- we think the victims are indeed victims, they've done nothing wrong, and splashing their names on the front page of a newspaper doesn't help move the dialogue ahead. We've given a lot of information about the attackers' infrastructure. And we think that's sufficient to corroborate our claims.

STOUT: Well, Grady Summers, we had a lot of questions about your report. Compelling read. Thank you so much for answering them for us right here on NEWS STREAM.

SUMMERS: Thank you.

STOUT: Thank you.

All right. Now, time for a check of the global weather forecast, in particular tropical cyclone forming over the Philippines. Mari Ramos is back. She joins us from the World Weather Center. Mari.

MARI RAMOS, AMS METEOROLOGIST: Hey, Kristie, the Philippines no stranger to tropical cyclones, and those who are watching from other parts of the world and probably thinking, well, isn't it winter there? How can tropical cyclones be forming? Well, in the western Pacific, they actually can form at any time of the year, and sometimes they happen in January and even, right now, in February, which is usually the coolest month.

I want to show you over here what we can expect as far as rainfall. Across the central and southern Philippines, easily another five to eight centimeters additional rainfall expected here. That will mean the potential for flooding, the potential for mudslides. This is a huge concern in this area so vulnerable to that -- to those kinds of conditions.

On top of that, of course, rough seas, because winds with this weather system, you know, about maybe 65 kilometers per hour sustained, that's going -- that is causing some problems with transportation, particularly the ferries that go back and forth among the islands here, which is so common, of course, in this part of the world. And notice the widespread moisture is stretching anywhere from the northern portion here of Davao across the central Philippines, and even southern parts of Lusana are now getting in on the action. Most of this rain will continue to fall over night tonight, and of course, as we're heading through the day tomorrow.

The area of low pressure is actually well down here to the south, and it is expected to continue trailing into the South China Sea. You can see that right there, over the next couple of days. Whether it develops or not, I'm not too concerned with that. It is a tropical depression right now, which is the bottom level of the tropical cyclone food chain, so to speak. It could become a tropical storm later. But either way, it's going to bring some very heavy rain for you here across the southern and central Philippines over the next couple of days. So, I'm very concerned with that and just be aware that that is something that is happening.

This picture here behind me, this is from Indonesia. We can pretty much see some very heavy rain, not just in Sumatra, but also in Java. And the potential for flooding remains across that region there, oh, these are the Philippines again. Notice all the moisture there, and then moisture here to the south and to Malaysia, and farther south even into Indonesia. Let me go ahead and show you that satellite image over here.

Notice all of that moisture continuing to spread over that region. That will be a concern over the next couple of days. It's been raining so heavily that that, you know, you're just seeing any amount of rain that falls here could cause some problems. But the tail end of this front that you see right over here across the northeastern China, eastern China, I should say, brought some snowfall over Shanghai. The snow still affecting portions of Japan. This is the picture from Shanghai. I kind of like this picture, though.

I know that if you have to kind of drive through all this stuff, and you were stuck at the airport for a little while, I know that it wasn't fun for you. It was pretty much over now. Some icy conditions overnight tonight, light rain and snow moving away, and the sea-effect snow continues over Japan, fairly dry across the Korean Peninsula, and then back over northern parts of China, including Beijing. Kristie, back to you.

STOUT: Mari, thank you.

RAMOS: Sure.

STOUT: So, what happens when a filmmaker runs out of money? Still ahead, the documentary that was partly shot with an iPhone and is now nominated for an Academy Award.

(COMMERCIAL BREAK)

STOUT: Welcome back, and this week on "Leading Women," we continue our look at Greek shipping executive Angeliki Frangou, and the Brazilian singer Daniela Mercury. Frangou was recognized as a global leader in the shipping industry, and Mercury has become an icon in her country for creating her own brand of Brazilian music. Becky Anderson talks to Frangou, and Felicia Taylor catches up with Mercury.

(BEGIN VIDEOTAPE)

BECKY ANDERSON, CNN CORRESPONDENT: Maritime shipping executive Angeliki Frangou certainly stands out. Not only because she is poised and confident, but also because she is often that rare face at the helm in the male-dominated industry.

(on camera): When you see that were you conduct yourself as opposed to other men, can you see the differences?

ANGELIKI FRANGOU, CHAIRMAN AND CEO, NAVIOS GROUP: What you see is you have diverse way of thinking, and you need that. I mean, the best companies in the world survived when they had diverse way of thinking in the executive.

ANDERSON: In other words, gender is not an issue. As chairwoman and CEO of the Navios Group, she is in charge of four shipping and logistics companies. She shows me a map of their global reach.

FRANGOU: The next area where it will be development in this century will be Africa.

ANDERSON (on camera): So how does that affect your business and its strategy, going forward?

FRANGOU: The issue is that you have to see political stability, and infrastructure development.

ANDERSON (voice over): Frangou, it seems, is in the job she was destined to do. Her family roots in the industry go back to her great grandfather. As a youngster, she remembers going to the shipyards with her father and learning from him. He is also well-respected in the industry.

FRANGOU: I like the challenge that you have to deal with everything, from the weather problems, to the technical issues, to the political movements. I like this continuous challenge.

ANDERSON: She entered the business on her own in 1990. And she formed her first company. In 2004, Angeliki acquired Navios, merging it with her existing company. She took the company public in 2005 and went on to form the other companies, all under the Navios name.

FRANGOU: You know, I first listed the company there in Nasdaq, and then we moved to the New York Stock Exchange as (inaudible) traditional business.

So, this was an important day for all my dreams, and, of course, for my father and my family that was there. It was a unique moment. It was a vindication of a network (ph).

ANDERSON (on camera): Were you nervous when you opened that door? And you knew you had to get this team onboard?

FRANGOU: I knew that I had to make them to trust me. I was coming from the (inaudible), and that made me to bring them aboard, create the ties, create a family and create a team work on the entire group.

ANDERSON (voice over): Team work, she says, is part of her management style, and what such a complex industry requires.

FELICIA TAYLOR, CNN CORRESPONDENT: I'm Felicia Taylor.

Brazilian pop star and businesswoman Daniela Mercury is a mainstay on the Latin music scene, with high energy performances that electrify her fans.

(MUSIC)

TAYLOR: Mercury sees her music as part entertainment, and part inspiration, especially to the younger generation.

DANIELA MERCURY, SINGER/SONGWRITER: I use my music to give them power, to give back, and I love to sing to big crowds in Brazil, because this ...

TAYLOR: Mercury's musical roots are here, in Bahia, her birth city, with its own musical pulse.

This is a house where she grew up, the very bedroom where she was born. As her brother shows us, it's here that Mercury's dreams of music started.

She launched her career singing in Brazil's famed carnivals.

(on camera): As a young woman, I mean you were 16, I mean a teenager, 17, 18, and you traveled in these trucks.

MERCURY: That's a very big party, million people on the street. There's a very interactive (ph) concert, you know, for hours and hours, six hours, seven hours, singing without stop.

(inaudible) let's go! Let's dance! Come on! Raise your hands!

(MUSIC)

TAYLOR: Mercury manages her own career and the people on her team, and says that controlling her destiny is important to her and key to her success.

MERCURY: I decide about my repertoire, decide about my clothes. I decide everything. The power to decide with me. I didn't know that I would be a singer, that I would be famous, but all that I know that I had to be a leader of my life.

TAYLOR: A leader, both creatively and as a businesswoman.

MERCURY: I have the amazing pleasure doing what I do. Because I'm in control. So I can decide when I want to or not to do concerts.

TAYLOR: Performances that have brought her much acclaim and adulation.

(CHEERS AND APPLAUSE)

(END VIDEOTAPE)

STOUT: Now, in the runup to the International Women's Day on March the 8th, you want to hear about some of the women who've inspired you. And cnn.com has a section with our favorite quotes from famous women. And we'd like you to share your favorites with us. Just go to cnn.com/leadingwomen. Now, Arsenal's quest to win the Champions League resumes on Tuesday night. But their manager isn't happy with the media. Find out what set him off, next.

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STOUT: Welcome back. You are watching NEWS STREAM, and let's return to a visual rundown of all the stories we're going to cover on this show today. In the few minutes, we'll tell you about an Oscar-nominated documentary that was partially shot with an iPhone, but now to sports. And the pressure on Arsenal's manager. The Champions League continues in a few hours with Arsenal involved in easily, the biggest match of the night. Let's turn to Alex Thomas in London for more. Alex.

ALEX THOMAS, CNN ANCHOR: Yeah, hi, Kristie. As you said, the Champions League continuing in a few hours time, and Arsene Wenger stands accused, really, of an emotional meltdown, some would say, ahead of his side's biggest match of the season so far. The host, Bayern Munich, in the Champions League round a 16 first league game at the Emeret Stadium here in London. And Bayern were last season's runners-up. They lead Germany's Bundesliga by 15 points, they haven't lost since October. And have gone -- check this out -- 67 days without conceding a goal. So, a real uphill task for Arsenal, who crashed out of England's FA Cup over the weekend. And maybe that explains the manager's tetchy (ph) mood when asked about reports he'd been offered a new contract.

(BEGIN VIDEO CLIP)

ARSENE WENGER, ARSENAL MANAGER: That's a wrong information, and there as well I would like -- I think I've worked for 16 years here in England, and (inaudible) repeat more than credit wrong information. But there's only one intention is to harm. I look -- I look at you , and not because you give information, I don't know if it's true (ph). I don't know where information comes from. Yeah, why do you look at me?

UNIDENTIFIED MALE: This is your press-conference. It's not my--

WENGER: OK, thank you. I just thought you had given this information out.

I've been accused of not taking seriously the FA Cup on Saturday. I won four times the FA Cup. Who's won it more? Give me one name.

(END VIDEO CLIP)

THOMAS: Portugal's Nani could play a bigger part as Manchester United chase a trophy treble this season, according to manager Alex Ferguson. Nani scored the opening goal in United's 2:1 win over Reading on Monday night, and then set up Xavier Hernandez for the second. Reading pulled a goal back through Jobey Mackanoff (ph). But it's United who goes through to a possible quarterfinal against Chelsea. Although Nani has been out of favor this season, Ferguson admitted the player was a great talent.

THOMAS: Now, the bosses at Swimming Australia have been castigated in an independent review into the London 2012 Olympic performance, the country's worst in two decades. Business consultants Bluestone tried to find out why had gone wrong, blamed the lack of leadership. Part of their report read, "There were enough culturally toxic incidents ... (such as getting drunk, misuse of prescription drugs, breaching curfews, deceit, bullying) to warrant a strong, collective leadership response. No such collective action was taken."

We'll have more on that story, and others in "World Sport" in just over three hours. For now, Kristie, back to you in Hong Kong.

STOUT: Well, culturally toxic incidents -- what a turn of phrase there. Alex Thomas reporting. Thank you so much, Alex.

Now, this past year's best movies will go head to head at Sunday's 85th Academy Awards, and the voting comes close today for members of the Academy. Now, in previous years, members sent out their ballots by mail, but this year they were able to do so finally online. While that sounds kind of high-tech, some have reported glitches with the system. The documentary maker Morgan Spurlock tweeted this in frustration, when his password didn't work and could only be sent to him by a snail mail.

Now, one Oscar nominated movie is making waves, but not just because of the onscreen story. "Searching for Sugar Man" was partially shot on an iPhone, with an app that cost the director $1. Nischelle Turner has more.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: If ever there is an air of intrigue and mystery around the pop artist, it is around the artist known as Rodriguez.

NISCHELLE TURNER, CNN CORRESPONDENT: "Searching for Sugar Man" is one of the hottest documentaries of the year, racking up awards worldwide. Now, it's in the running for an Academy Award. Director Malik Bendjelloul admits ...

MALIK BENDJELLOUL, DIRECTOR, "SEARCHING FOR SUGAR MAN": There have been cool times, so far, so good.

TURNER: The film tells the unusual story of Rodriguez, a singer from Detroit who never gained fame in America, but became somehow a legend in South Africa.

BENDJELLOUL: And I was like, wow, this is the best story I've ever heard in my life!

TURNER: And the story behind the movie, pretty remarkable, too. It was shot partly on an iPhone. Bendjelloul told us that was a matter of necessity.

BENDJELLOUL: I started shooting this on a super 8 camera, like with film, which is pretty expensive stuff, and I completely ran out of money. I needed just a very few -- there were just very few shots left. But I needed those shots, and one day I realized that there was this -- this $1 dollar. It was on my iPhone. And I tried it, and it looked basically the same as the real stuff.

So, then the film was finished with a smartphone.

TURNER: The app Bendjelloul used is this one. It's called, "8 Millimeter", created by the company Nexvio. What Instagram does for photos, this application essentially does for video -- turns everything retro, instantly. Check this out. So, this is me being shot with normal video. And this is me being shot with the 8 Millimeter application.

The director showed us frame by frame, where he used the app. One example -- this aerial sequence.

BENDJELLOUL: This has actually been out of -- it's like a window, with this -- it looks like real film. It really does. You can't tell the difference.

TURNER (voice over): Bendjelloul told us he also used the app to shoot video off a computer screen. His purpose was to get that 70's feel, the time when his subject, Rodriguez, was actively making music.

BENDJELLOUL: If this had been a normal camera, this is Rodriguez's reflection on his wall in his house, and then I shot this -- the computer looks like this, the computer screened (ph) like that, so I got the super 8 feeling.

TURNER: Tracking down the creator of the app proved a challenge worthy of a movie about tracking down a mystery musician. We eventually located Nexvio's president, Hongyu Chi, in northeastern China, where he was visiting. By Skype, he shared his reaction to finding out his app was used in an Oscar-nominated film.

HONGYU CHI, PRESIDENT, NEXVIO INC.: It's crazy. We are pretty thrilled.

TURNER: Hearing about his app's connection to the film inspired Hong to watch "Searching for Sugar Man."

And what did you think?

HONGYU CHI: It's quite a touching film, I think, and (inaudible) that a documentary could be so touching.

TURNER: Hong is a fan of the movie, but Bendjelloul is a fan of the app that helped put him in the thick of the Oscar race.

Nischelle Turner, CNN, Hollywood.

(END VIDEOTAPE)

STOUT: Before we go, that story made us think. What if we ditched out big studio cameras for an iPhone? Well, this is NEWS STREAM through the lens of an iPhone camera. I'll let you be the judge whether it works or not.

That is NEWS STREAM for now. "WORLD BUSINESS TODAY" is next.

END