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I am developing a Windows Form Application in C#.I have heard that one should not use built in methods and functions in code since hackers have deep understanding of such built in methods and know how to fail them Instead one should always use his/her own functions and methods and if not then call built in functions intelligently from those newly made functions.How much is that true?
A supporting example in favour of my argument is that I have seen developer always develope there own made encryption algorithm like AES,DES,RC4 and Hash functions since they believe that built in encryption algorithm have many times backdoor in them.
What?! No, no, no! Whoever told you this is just wrong.
There is a common fallacy that published source code is more vulnerable to "h4ckerz" because it is available for anyone to spot the flaws in. However, I'm glad you mentioned crypto, because this is an area where this line of reasoning really stands out as the fallacy it is.
One of the most popular questions of all time on https://security.stackexchange.com/ is about a developer (in the OP he was given the pseudonym "Dave") who shared this fear of published code. Dave, like the developer you saw, was trying to homebrew his own encryption algorithm. Here's one of the most popular comments in that thread:
Dave has a fundamentally false premise, that the security of an algorithm relies on (even partially) its obscurity - that's not the case. The security of a hashing algorithm relies on the limits of our understanding of mathematics, and, to a lesser extent, the hardware ability to brute-force it. Once Dave accepts this reality (and it really is reality, read the Wikipedia article on hashing), it's a question of who is smarter - Dave by himself, or a large group of specialists devoted to this very particular problem. (emphasis added)
As a matter of fact, as it stands now, the top two memes on Security.SE are "Don't roll your own" and "Don't be a Dave".
While this has all been about crypto, this applies in general to most open-source software. The chance that a backdoor will get found and fixed goes up with each new set of eyes laid on the code. This should be a simple and uncontroversial premise: the more people are looking for something, the higher the chance it will be found. Yes, this applies to malicious users looking for exploits. However, it also applies to power users, white hat hackers, security researchers, cryptographers, professional developers, and others working for "good", which generally (hopefully) outnumber those working for "evil". This also implicitly relies on the false premise that hackers need to see the source code to do bad things. This should be obviously false based on the sheer number of proprietary systems whose source code has never been published (various Microsoft and Adobe programs come to mind) which have been inundated with vulnerabilities for years. Maybe having source code to read makes the hacker's job easier, but maybe not -- is it easier to pore over source code looking for an attack vector or to just use scanning tools and scripts against a compiled binary?
tl;dr Don't be a Dave. Rolling your own means you have to be the best at everything to succeed, instead of taking a sampling of the best the community has to offer.
Heartbleed
In your comment, you rebut:
Then why was the Heartbleed bug in openSSL not found and corrected [earlier]?
Because no one was looking at it. That's the sad truth. Here's the difference -- what happened once someone did find it? Now tens of thousands of security researchers, crypto experts, and others are looking at it. Suppose the same kind of vulnerability existed in one of the proprietary products I mentioned earlier, which it very well could. Once it's caught (if it's caught), ask yourself:
Could the team of programmers at the company responsible benefit from the help of the entire worldwide community of security experts, cryptographers, and other analysts right now?
If a bug this critical were discovered (and that's a big if!) in your software, would you be prepared to deal with the fallout caused by your custom implementation?
Unless you know of specific failure modes or weaknesses of the built-in methods your application would use and know how to minimize or eliminate them, it is probably better to use the methods provided by the language or library designers, which will often be both more efficient and more secure than what an average programmer would come up with on the fly for a particular project.
Your example absolutely does not support your view: developing your own encryption algorithm without some serious background in the domain and review by cryptanalysts, and then employing it in security-critical code, is a recipe for disaster. Even developing your own custom implementation of an industry standard encryption algorithm can present problems, and almost certainly will if you are inexperienced at it.
This question already has answers here:
Closed 12 years ago.
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How do you protect your software from illegal distribution?
Best practice to prevent software copy
Hypothetical situation:
Lets say I have built a software product from the scratch and it does wonderful things. The only problem is that, once someone takes a look at the code, they will understand it very easily and they can easily build it up themselves.
Now, the thing is that I built the code from the scratch 100% and uses a mixture of API calls.
Nobody else is involved in the development of the code.
If I want to sell this product, what is the guarantee that someone much smarter than me will reverse engineer the whole thing and come up with better product?
Right now I am thinking of fragmenting the whole code. Adding lots of redundant code and tonnes of comments.
Is there any software which encrypts the software code, that will make debugging, troubleshooting, and understanding how the code works virtually impossible? and yet runs as usual? so that the developer can have peace of mind?
Very few things in a program are truly novel. Almost everything that you are likely to put into your code, someone else could invent on their own. Generally more easily than they could learn it by reading your code. Reading code is harder than writing it, and most programmers don't really like doing it anyway.
So it's much more likely that they will look at your app and think "I could do that", then "That's cool, I'm gonna read that code and then copy it!". Even if they understand it, you will still own the copyright, you still get to market first.
I recommend that you just forget about it.
once someone takes a look at the
code, they will understand it very
easily and they can easily build it up
themselves.
So don't give anybody the source code.
If I want to sell this product, what
is the guarantee that someone much
smarter than me will reverse engineer
the whole thing and come up with
better product?
(a) So start selling it now and capture the market. Reverse engineering takes time, during which you are capturing market and 'mind-share'. (b) Put a provision in your licence agreement that prohibits reverse-engineering. (c) Make sure everybody who gets the product signs the agreement.
Right now I am thinking of fragmenting
the whole code. Adding lots of
redundant code and tonnes of comments.
That only has a point if you're going to distribute the source code. In which case nobody even needs to reverse-engineer. They have your source code. Don't give it to them.
Is there any software ...
There's lots of software that purports to do this job. However it is a technical solution to a business problem. All software can be reverse-engineered, because at some point or other it all has to be decrypted and de-obfuscated to the point where the CPU will understand it. At that point it is essentially plaintext. So no technical solution is formally speaking possible (short of something like code that executes in a tamper-proof HSM).
I will add that there is another business mechanism you can use to defend against business loss, which is what this is all about: price. Make the price so high that the licensees will value their copy and not permit it to be inspected, or make it so low that reverse-engineering is cost-infeasible; or make it free and make your money on the support contract.
Once you actually have the knowledge and experience to write such a codebase, it will be clear to you that obfuscation is meant to deter casual IP infringement.
Someone who wants to know your code is going to know your code.
If it becomes an issue of monetary loss, the courts are your protection.
That's how it works.
Someone will always be able to understand and work out your code. Heck, if you had 0 way getting to the code, even just using the system is enough for someone to be able to replicate the process.
Example: I take a jug of water and pour it into the cup, while my back is facing to another person. This other person knows that water and gravity are awesome at making things fall into other containers, so they can then work out a process of lifting a jug to let gravity (API call) work in their favour. They mightn't know exact what angle you used in your forearm and any super-sneaky cup-holding techniques you used, but they can replicate the same process and improve on it over time.
tl;dr: You can't protect code.
The thing to do is invent even more wonderful things while the competition is reverse-engineering your current stuff. It's called competing through innovation.
I am not a lawyer
if you are really worried about it, to the point you are willing to invest money in it, dont protect your code (beyond something reasonable like obfuscation or encryption) but rather patent your idea and your art. Then if someone does take it, reverse engineer it and make a better process based of yours, you have legal grounds to get your money.
There are tons of things you will have to do, include proving they took your idea (which isnt easy), but if this is the solution to world hunger and all of humanities problems its the thing to do.
Now for the downside, I will guess, and probably be 90% right that your method is:
Not patentable, for various reasons (I was amazed at the number of already patented ideas, and how difficult it was to identify original art)
Not new, or unique (i.e. there is already established art for it)
Not worth patenting because the expense far outways the benefits
An IP lawyer can tell you for sure, and the expense of a consult is not that much. Overall it will be cheaper to consult with them then to invest a lot of time in hiding code.
Good luck.
Don't even bother. If your code really "does wonderful things" be assured that it'll get hacked. And be it just for curiosity.
There is no 100% way to protect your code from reverse engineering. What language are we talking about? If this is C/C++ then it is pretty hard to reverse engineer, more you could strip it from debugging information etc. But if this is for example Java then even if you obfuscate the code, there are some pretty cool tools (like JAD) that will reveal much of your work anyway.
Despite all of this I think you should try to change your attitude. Big companies pay a lot of money for simple solutions and it seems that nowadays service is the most important thing, not the software (hence the success of open-software based companies). So, if you have a great software don't be scared that someone might steal it, rather think how to sell it good.
Is there any software which encrypts the software code, that will make debugging, troubleshooting, and understanding how the code works virtually impossible? and yet runs as usual? so that the developer can have peace of mind?
This is the totally wrong mindset IMO. What happens if you get hit by a bus? Your company goes bankrupt? All your data gets destroyed in a fire? For every single one of your customers, the value of their investment in your software will drop, and eventually reach zero, because the software can't be developed, or troubleshot, any further without you. I have seen so much money wasted that way, I think it's a horrible business model.
I earn my bread with making software myself so I know the hardships of making a living with it. Still, obfuscation can't be the way to go nowadays. Impose strict license agreements on your customers, scare the hell out of them so they don't even think about redistributing the software, but leave it open.
This is futile. There is always someone smarter than you and therefore they will be able to reverse engineer your obfuscation.
Usually someone smart enough to hack your code and use it in a meaningful way is smart enough to do it on their own, and probably thinks they can do it better than you did, so they won't bother stealing your stuff.
Don't worry about the people who can hack your code but not make meaningful use of it. If you've done a good job, this can only reinforce the quality of the job you've done (think of all the crappy touchscreen phone imitators).
They are going to reverse-engineer your code. Nothing can stop them.. The only thing you can do is make it harder. This ranges from obfuscating code that is inheritely "open" such as PHP and Javascript, all the way down to littering your code with a crap load of self-modification.
In a lot of ways, I think, the thing that makes a piece of software valuable, is not the crazy technological advancement that it provides, but rather the things that we think might think of as being tertiary to the piece of software itself. Like the fact that you'll be there to support it. Or that it's provided as a web service and you'll be there to make sure the server is running. Or that it's a community, and you'll be there to moderate and build the community.
While you may be actually selling code, the value you that your code has isn't intrinsic to the code itself, but rather derives from the features and ecosystem that surrounds your code.
I'm producing a dll for a business partner of mine that he is going to integrate into his app. But I also want to somehow lock the dll so it cannot be used by anyone else. The API of the dll is quite straight forward so it'd be easy to reverse-engineer and use it elsewhere.
How do I do that? My only idea so far would be to add a function in the DLL that'd unlock it if the right parameter is passed to it. But again, it can't be static, this would be too easy to intercept, so I am looking for something semi-dynamic.
Any ideas? Thanks in advance.
A
For .net libraries, this is already built into the framework, you just need to set it up. Here is an MSDN article about it.
How to: License Components and Controls
Other than liccensing, you should also obfuscate your code using a tool such as dotFuscator.
PreEmptive's DotFuscator
How likely do you think it is that you'll actually suffer any ill effects (lost income etc) due to this? How significant would such ill effects be? Weigh that up against the cost of doing this in the first place. You could use obfuscation (potentially - it depends on what kind of DLL it is; native or .NET?) but that will only give a certain measure of protection.
You need to accept that it's unlikely (or impossible) that you'll find a solution which is 100% secure. There are shades of grey, and the harder you make it for miscreants, the more effort (or money) you're like to have to put into it too. It may well also make it harder to diagnose issues (e.g. obfuscators munge stack traces; some allow a mapping tool back to the original, but you're likely to lose some information).
It looks like you need to create and use license keys:
http://www.google.com/search?q=creating+license+keys+for+applications&rls=com.microsoft:pt&ie=UTF-8&oe=UTF-8&startIndex=&startPage=1
Quick and dirty in .NET: strong-name all your assemblies and all assemblies that will access your "locked" dll. Mark all your API classes as internal instead of public. Then, on your "locked" dll, specify those dlls that should have access to your internal API with the InternalsVisibleTo attribute.
Are you trying to protect from casual pirates or something else ? Whatever you do, if the software is remotely useful it is gonna be craked, patched and what not - just ask any of the third party controls vendors.
Any solution that you come up with, it is going to be cracked. Someone might just open the dll in hex editor and patch your function that does the checks, validation and verification.
Hear lately I've been listening to Jeff Atwood and Joel Spolsky's radio show and they have been talking about dogfooding (the process of reusing your own code, see Jeff Atwood's blog post). So my question is should programmers use decompilers to see how that programmers code is implemented and works, to make sure it won't break your code. Or should you just trust that programmers code and adapt to it because using decompilers go against everything we as programmers have ever learn about hiding data (well OO programmers at least)?
Note: I wasn't sure which tags this would go under so feel free to retag it.
Edit: Just to clarify I was asking about decompilers as a last resort, say you can't get the source code for some reason. Sorry, I should have supplied this in the original question.
Yes, It can be useful to use the output of a decompiler, but not for what you suggest. The output of a compiler doesn't ever look much like what a human would write (except when it does.) It can't tell you why the code does what it does, or what a particular variable should mean. It's unlikely to be worth the trouble to do this unless you already have the source.
If you do have the source, then there are lots of good reasons to use a decompiler in your development process.
Most often, the reasons for using the output of a decompiler is to better optimize code. Sometimes, with high optimization settings, a compiler will just get it wrong. This can be almost impossible to sort out in some cases without comparing the output of the compiler at different levels of optimization.
Other times, when trying to squeeze the most performance out of a very hot code path, a developer can try arranging their code in a few different ways and compare the compiled results. As a last resort, this may be the simplest way to start when implementing a code block in assembly language, by duplicating the compiler's output.
Dogfooding is the process of using the code that you write, not necessarily re-using code.
However, code re-use typically means you have the source, hence 'code-reuse' otherwise its just using a library supplied by someone else.
Decompiling is hard to get right, and the output is typically very hard to follow.
You should use a decompiler if it is the tool that's required to get the job done. However, I don't think it's the proper use of a decompiler to get an idea of how well the code which is being decompiled was written. Depending on the language you use, the decompiled code can be very different from the code which was actually written. If you want to see some real code, look at open source code. If you want to see the code of some particular product, it's probably better to try to get access to the actual code through some legal means.
I'm not sure what exactly it is you are asking, what you expect "decompilers" to show you, or what this has to do with Atwood and Spolsky, or what the question is exactly. If you're programming to public interfaces then why would you need to see the original source of the the third party code to see if it will "break" your code? You could more effectively build tests to in order to determine this. As well, what the "decompiler" will tell you largely depends on the language/platform the software was written in, whether it is Java, .NET, C and so forth. It's not the same as having the original source to read, even in the case of .NET assemblies. Anyway, if you are worried about third party code not working for you then you should really be doing typical kinds of unit tests against the code rather than trying to "decompile" it. As far as whether you "should," if you mean whether you "should" in some other way other than what would be the best use of your time then I'm not sure what you mean.
Should Programmers Use Decompilers?
Use the right tool for the right job. Decompilers don't often produce results that are easy to understand, but sometimes they are what's needed.
should programmers use decompilers to
see how that programmers code is
implemented and works, to make sure it
won't break your code.
No, not unless you find a problem and need support. In general you don't use it if you don't trust it, and if you have to use it you even when you don't trust it you develop tests to prove the functionality and verify that later upgrades still work as expected.
Don't use functionality you don't test, unless you have very good support or a relationship of trust.
-Adam
Or should you just trust that programmers code and adapt to it because using decompilers go against everything we as programmers have ever learn about hiding data (well OO programmers at least)?
This is not true at all. You would use a decompiler not because you want to get around any sort of abstraction, encapsulation, or defeat OO principles, but because you want to understand why the code is behaving the way it is better.
Sometimes you need to use a decompiler (or in the Java world, a bytecode viewer) when you are troubleshooting an annoying bug with a 3rd party library where an exception is thrown with no useful error message, no logging, etc.
Use of a decompiler has nothing to do with OO principles.
The short answer to this... Program to a public and documented specification, not to an implementation. Relying on implementation specifics and side-effects will burn you.
Decompilation is not a tool to help you program correctly, though it might, in a pinch, assist you in understanding a problem with someone else's code for which you don't have source.
Also, beware of the possible legal risk of decompiling; many software companies have no-decompile clauses which could expose you and your employer to legal consequences.
This question already has answers here:
How do you protect your software from illegal distribution? [closed]
(22 answers)
Closed 5 years ago.
Besides open-sourcing your project and legislation, are there ways to prevent, or at least minimize the damages of code leaking outside your company/group?
We obviously can't block Internet access (to prevent emailing the code) because programmer's need their references. We also can't block peripheral devices (USB, Firewire, etc.)
The code matters most when it has some proprietary algorithms and in-house developed knowledge (as opposed to regular routine code to draw GUIs, connect to databases, etc.), but some applications (like accounting software and CRMs) are just that: complex collections of routine code that are simple to develop in principle, but will take years to write from scratch. This is where leaked code will come in handy to competitors.
As far as I see it, preventing leakage relies almost entirely on human process. What do you think? What precautions and measures are you taking? And has code leakage affected you before?
You can't stop it getting out. So two solutions - stop people wanting to hurt you, and have legal precautions. To stop people hating you treat them right (saying more is probably off topic for stack overflow).
I'm not a lawyer, but to give yourself legal protection, if you believe in it, patent the ideas, put a copyright notice in the code, and make sure the contracts for your programmers specify carefully intellectual property rights.
But at the end of the day, the answer is run quicker than the competition.
Unless you're working with something highly classified and given that you can't block email and USB devices I guess you aren't there's really not to much damage to be had even if the source code leaks. The thing is, what is the code, or parts of it worth without the knowledge of how it works and the organization around it.
In general the value of "source" is much less than is commonly touted, basicly the source without the people or the organization isn't worth the storage it occupies for a competitor.
Also, you're missing the most likely attack vector, and it's also the one you can't stop no matter what. If someone really really want's to know how you made your magic then they'll try to hire your developers away, and since you can't stop them from having information inside their skull and even if they turn in all their possesions ther knowledge and domain expertise is leaving with them. Basicly employee retention and trust is the only way. Sorry.
I don't know how much actual help this is going to be, but:
Don't p*ss your programmers off. Don't get them in a position where they want to give the source to a competitor. Most places undervalue their developers. Given where you are (SO), I guess you are less likely to. Nothing got to me more than seeing the sales folks out for games of golf - paid, and paid for, by the company - while we had to fight to get pizza once a month.
Really, if your direct competitors got your code today, what would it do? Is your product or vertical market that stagnant that you wouldn't release newer, better versions before they could react? Is there no room for innovation? Most companies overvalue their "proprietary algorithms and in-house developed knowledge". Sure, it may cut some time off, but it's only about 10% of the problem.
If you got all the source for all your competitors products, how much actual use would it be? I'd guess it would set you back months. Not forward. Back.
If you had a clean system, and little external/internal knowledge, how long would it take you to get your own product into a buildable state? How long would it take to drill down into the code and workout what is going on? How much time and money would you waste trying to work something out, rather than spending time and money on how to make your product work better?
I've actually been in the position of having all the source - 1million lines+ of code - to a competitor's product. We did nothing with it - aside from a bit of a poke-around and then delete it, which was more than I was comfortable with - but I would expect that we'd have chewed up months of time just to get to where they were then.
So we nuked it, slapped the id10t who got it (yes, a developer/PM who came over from the other company), and thought about how to make our product kick so much butt that it didn't matter what they did. Much better use of time. Worked well, too. We had differentiators, not just re-hashing the same features in the same way they did them.
Sorry, but there is no way you can stop people getting stuff out, and still be able to actually work. You can stop them wanting to do it, or make it so there is no value to them having it.
We were worried about people decompiling our code too. We stopped worrying when we realised that WE had enough trouble working out what was going on inside 500K+ lines of C#, C++ and HTML code talking to MAPI/Exchange. If someone can decompile it and work it out, then we want to hire them......
BTW, for clarity, and given who I now work for, I should point out this is not my current employer. This was quite a while ago.
The code does not leak out on itself. It takes people to take it. There are obviously some security measures you might use like traffic analysis and lock-down on the repositories so only authorized developers can connect to it.
But by the end of the day your best option is to make sure that no one WANTS to steal from you. Your team has to be happy, they have to be proud to work for your they have to be loyal to the company and to each other. If you have such team it's a simple question of explaining to everyone that the code has to be protected from outsiders. It will not stop a dedicated mole but will prevent accidents.
P.S. And yes, proper clauses in the contracts would not harm as well, at least they will make sure that the developers are AWARE that taking code outside is morally wrong.
Follow these guidelines and it shouldn't matter if the contents of your entire source code repository is posted all over stackoverflow:
http://geocities.com/mdetting/unmaintainable.html
Oh, and show your developers that you don't trust them by blocking access to parts of the source code, scanning outgoing/incoming email etc. That is a surefire way to make them want to stay around... ...nothing improves morale like a bit of mistrust in the workplace.
Another cool way is to tell one half that they are "team a" and name the other half as the untrustworthy "team b". Then reverse it and say the same thing to the "team b" members. Encourage them to keep an eye on the "bad guys" in the other team and to report any signs of illoyalty to you. Sprinkle a few "conflict inducers" (e.g. tell "Joe": 'do you know what Ed says about you behind your back?') etc. Works wonders if you set up the developers against each other and create a few [invented-by-you] conflicts here and there...
(Eh, and no, I don't actually recommend any of the above. Just kidding. But I have seen people use all of the tactics above. And it didn't work.)
Okay, I am going to be a little practical here.
Being nice to everybody and hoping they won't hurt you doesn't work.
Every programmer knows from the day he joins a company that he'll not stay there forever. He will change when he's learned enough to get a better opportunity.
The programmers who write the code believe that they have the ownership to it even if they wrote it on the time they rented out to somebody else. So many of them will usually try to get their hands on the source-code even if they don't intend to hurt anybody.
Once they leave the company and they've carried the source code with them and lost contact with their colleagues, the conscience settles down and goes on a vacation and after a while bits and pieces from the code start showing up everywhere.
That's what I KNOW happens cause I've witnessed it happen to my company.
So what does one do?
Sign a NDA which specifically mentions that they programmer WILL not take copies.
Distribute your product between programmers, and if possible get modules coded individually and integrated by a chief whose responsibility is that all programmers do nt get all the code.
At the time of termination get a written undertaking from the coders that they do not possess any IP of the company and they understand the penalties of violation.
If somebody violates your IP, sue the man! No exceptions. It'll work as an example for the present team.
Do I sound extreme?
I remember this happening to Valve when they were developing HL-2. Interesting link here: http://www.shacknews.com/onearticle.x/28619
Most of the answers are based on Moral and ethical values. I wonder if Google, Facebook etc. just rely on their employees good will. Give me a break, that's totally utopian. Don't be a fool. Be realistic.
YES, it is possible to prevent code leaking:
Using a virtual server hosting virtual machines, programmers can only access locally to these virtual machines (intranet) via Remote Desktop. Repository is managed locally. private keys are required to access the repository. Copy/paste from virtual machine to client is disabled. only copy/paste from client to virtual is allowed.
Companies like facebook do that.
The only way to still code is by taking pictures to the actual code, which is totally not practical and feasible at all, and since there are surveillance cameras everywhere, you will have to go to the bathroom to take those pictures.
I've worked somewhere where there was a real culture of secrecy about this sort of thing (historically there had been a number of times when the company was small where "customers" had, shall we say, abused their access to our product).
While at the top the management were very protective, I see it slightly differently. I think our code, while not entirely irrelevant, isn't as key as you'd expect it to be in a software company.
The reason that we are successful is:
1) The code is essentially the solution to a bunch of problems. If you get our code you get those solutions but we still have the smart people who solved those problems. They understand those problems better than you do and are better able to solve the next set of problems better than you are.
2) Because they really understand the problems (and the solutions) we can do things faster than our competitors which translates to cheaper (or more profitable).
3) Also because of those people and the attitude within the company we've delivered well to our clients and provided good support.
4) And because of that we have a good reputation and reference-able customers.
A small number of companies have code which is genuinely worth keeping secret - proprietary algorithms and that sort of thing - but for a vast majority of us our products are very easily replicable by smart people.
What I'm saying is do the basics - write it into people's contracts that they can't take it, keep it secure and so on - but don't obsess over it. Unless you're in a very specific market it's unlikely to be what's really going to make your business succeed or fail.
The best step starts from reruting guys with strong ethical behaviour.
Various other steps can be taken like all communication being scanned. There are places where email and all information going out is scanned. The desktop/laptop does not have hard-disk or the access is restricted and all work is on network folders, even when working from home, one has to get connected to internet. The offline work gets synchronized. The USB and drives are disconnected.
The other policies are to provide access only on need basis.
These will only slow down and hinder to some extent, but is one is very determined then he would find ways to get around this.
The other way is if the code is really very important, then have the idea copywrite protected legaly.
To be honest it's almost impossible. If I wanted to suggest what a company that would shortly appear on the Daily WTF would do:
Disconnect the "work computer" from the internet, bt because they need internet access for reference buy everyone a wbbook.
Stuff the developers USB slots with epoxy and require that they load/unload everything from a centralised server, which scans all the data that goes through it for code like syntax.
Or you could just trust your employees and make them sign an NDA...
I personally never tested on any real case, but I would suggest using code fragmentation:
basically you split your project in a number of libraries, define interfaces and unit tests for each of them, then you separate SVN repositories so that each group have access to a limited part of your precious source code.
This is also a good practice no matter what and should help if you are outsourcing abroad.
The previous answers all seem to center on building trust and employing ethical people.
Another possibility might be to create your own domain specific language and tools. That will make any leaked code harder to use. It might still be possible to steal useful ideas from it, but it would not be possible to simply compile a competing product unless the whole toolchain is leaked.
Trust your developers. People tend to live up or down to expectations. Treat them well, and remember that loyalty goes both ways. After all, if you can't cut off thumb drives, you can't stop anybody from leaking code, no matter how much you don't trust them.
That being said, find yourself a lawyer with trade secret expertise, probably expertise in other parts of IP law, and ask how to legally safeguard stuff. You do want to make sure that, if a competitor gets your stuff, it's not legal for the competitor to benefit from it.