Another of the ciphers used to secure traffic on 3G GSM networks has been cracked. It’s not clear whether it can break actual traffic or whether it s useful operationally. Related-key attacks are a form of cryptanalysis that showed up about 10 years ago, but they re rare in the real world because you need the related keys. Schneier: This isn t an attack that should make everyone throw their 3G phones in the ocean. Instead of using the existing cipher, they decided to modify it and by modifying it, they broke it.
Source: https://threatpost.com/four-questions-bruce-schneier-gsm-cipher-crack-011210/73361/