With the ban on VPNs, steganographic[1] techniques that make encrypted traffic look like regular traffic will become more and more common. The troubling thing is the fact that these techniques are somewhat hungry for bandwidth.
Crypto is currently usable in practice. Its a bit hard for many users, but its doable, especially with modern VPN implementations. If any encrypted tunnel is allowed, you can put all your traffic through it, and no one knows whether you are surfing banned websites, or working on the corporate VPN. And you can be pretty confident your modern crypto implementation isn't going to be broken.
But steganography isn't really usable, in practice. If nothing else, the government can do traffic analysis, and see suspiciously large traffic volumes going to a small collection of servers (which are accepting the steg'd communication, and proxying your requests, presumably).
And even if the traffic looks like normal HTTP, with images in it, that's simply not good enough to use, in a regime where the secret police can arrest you if they suspect you are trying to hide your traffic content. And they will be able to find users, because eventually the servers accepting steg'd traffic, which the population are using, will become known.
So, while I think it'd be very hard to remove the ability to send small amounts of text data, from the Internet, I think it'd be possible to make private communication unworkable, in practice, for most people.
I don't see how this would be worked around, without building a massive distributed network of computers that all accepted and routed steg'd communication; something like if every webserver would accept, and onion-route, incoming steg'd traffic.
That doesn't exist, so I think their initiative will work, if they push it enough; hopefully rules like this remain isolated to relatively repressive regimes, and not gain widespread adoption; the widespread commercial use of encrypted communications is probably the best defence against global crypto bans.
Let us remember that normal HTTP traffic follows a power-law, with relatively few sites getting the majority of the traffic, so there might be a way, if many of the high-traffic sites on the internet collaborate, of making "covert" traffic look just like "innocent" traffic.
that's simply not good enough to use, in a regime where the secret police can arrest you if they suspect you are trying to hide your traffic content
Even if we accept the premise of undetectable steganography, which is not possible by any possible means today, the arrests will continue to happen. However, I hope they will tend to happen less, as the large number of false-positive arrests would certainly cause high commotion in the general population.
* So, while I think it'd be very hard to remove the ability to send small amounts of text data, from the Internet, I think it'd be possible to make private communication unworkable, in practice, for most people.*
You are correct. Under the current situation, it'll be hard to make all your communication private under the restrictions imposed by, for instance, the Pakistani government, but dissidents don't need all communication to be private, and small amounts of text data might be all that's needed.
Only in the sense that "Crypto is breakable."
The entire point of steganography is that it isn't detectable. If it can be detected, you need a better algorithm.
If you're encrypting your steganographic messages, you're increasing the entropy of the plaintext message you're concealing it in.
Looks like you're getting the hang of it: good steganography relies on having better statistical models than the opposition.
Things are weighted in favour of the concealer, however, as (unlike the attacker) he doesn't have to worry about false positives/negatives
Furthermore, hiding even an unencrypted message still adds entropy, since you're encoding more information in the same amount of space.
No. It is perfectly possible to have steganographic keys, in the same way that you have cryptographic keys.
Trivial example: If the key is 7, the hidden message can be extracted by combining the least significant bits of every 7th pixel of an image. (Incidentally, that hidden message could also be, and indeed probably should also be, encrypted.)
For an example that's only slightly more complex but might actually be useful, replace "7" with a seeded CSPRNG.
you're increasing the entropy of the plaintext message you're concealing it in.
Yes. But you should still be able to conceal a low-bitrate secret message inside a high-entropy covertext/envelope/whatever-you-call-it without a significant chance of being detected.
Trivial example: With a good algorithm and a stick full of 1MB JPEGs, it shouldn't be possible for an attacker to determine which files contain a concealed (140-byte) tweet and which don't.
What I know is that, as https is so easy to use, there are plans to make it serve covert traffic. So you would make a request to https://www.friendlyproxy.com with an extra header somewhat like What-I-Want: http://www.bannedsite.com and have "friendlyproxy.com" serve you the document you originally wanted.
I forgot the name of the project, though. I believe it was from an American university
Besides, with this new wave of government carrying MITM attacks, I don't know how useful this techniques will be.
EDIT: I was able to find a link explaining the Telex project from University of Michigan: http://ns.umich.edu/htdocs/releases/story.php?id=8505