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Google Warns of China Exit Over Hacking
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Google Warns of China Exit Over Hacking - 01-12-2010, 07:28 PM

Cyber Attack Targeted as Many as 34 Firms, Email of Human-Rights Activists; Investigators Probe Link to Chinese Government

I previously posted a thread ("The U.S. is under attack!" - 12-18-2009, 08:11 AM at http://forums.azbilliards.com/showthread.php?t=168263 ) discussing the current level of Chinese organized and unorganized hacking I have professionally witnessed from 200 remote systems I curreently manage around the U.S. on a slew of networks and the many cyber attacks going on throughout the WWW. Some here dismissed it as no biggie talking about the pentagon based secure grids etc,etc, but my point was this war isn't over the military industrial complex's grid... it is over the WWW and other networks we all rely on to do our everyday business. We are being attacked from a country that has over a billion people and everyday they could be adding 1000s more to the ranks of their nationalist hackers. We all know that once the Chinese have the technology they want, they could gut us on the internet by sheer volume alone and move on. .... Apparently Google is getting close to being done with them before they are done with Google.


Cyber Attack Targeted as Many as 34 Firms, Email of Human-Rights Activists; Investigators Probe Link to Chinese Government

Google Inc. said it may leave China after an investigation found the company had been hit with major cyber attacks it believes originated from the country -- a move that would amount to one of the highest-profile rebukes yet of China by a major U.S. firm.

The attack targeted as many as 34 different companies or other entities, according to two people familiar with the investigation, which has been under way for weeks.

Investigators are probing whether the attack is linked to the Chinese government or intelligence services, one person familiar with the investigation said. The attack has piqued the interest of U.S. intelligence agencies, including the National Security Agency, this person added.

Google said it believed the attackers were trying to access the Gmail accounts of Chinese human-rights activists. A company spokesman declined to identify the other companies affected, saying only that it was in the process of notifying the companies and working with U.S. authorities.

For Google to withdraw from China would be an extremely rare repudiation by a Western company of what is almost universally seen in big business as one of the world's most important markets. Even the public suggestion that it is considering such a move is likely to infuriate Chinese authorities.

Google said it will be talking with the Chinese government in coming weeks about how it might operate in China without censorship, long a thorn in the side of Western Web concerns operating there. "We have decided we are no longer willing to continue censoring our results" on its China Web site, Google.cn," the company's chief legal officer, David Drummond, said in the post.

"We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China," Mr. Drummond wrote.

Chinese officials couldn't immediately be reached for comment. The government in the past has repeatedly defended its handling of the Internet, and has rejected accusations that China is responsible for cyber attacks against foreign entities.

Google launched its Chinese-language search engine in 2006, agreeing to censor some of its results, a move that sparked sharp criticism from human-rights groups and Web-industry officials who are critical of any restrictions on the Internet.

Tensions between Google and the Chinese government began soon, escalating in 2009 when Chinese officials reprimanded Google and accused it of having pornography on its sites; several Google services were temporarily inaccessible in China. Google's video-sharing site, YouTube, has also been inaccessible within China for the past number of months, and has been periodically banned in the past.

Google's move comes as the company has been in negotiations with Chinese officials over various Google services in China. Last year, it agreed to remove some foreign-language links on its China homepage to placate Chinese officials.

Google said yesterday it was making its move because it detected a "highly sophisticated and targeted attack on our corporate infrastructure originating from China" in mid-December. Google said the attack resulted in "the theft of intellectual property from Google." The company said that only two Gmail accounts appeared to have been accessed.
"These attacks and the surveillance they have uncovered -- combined with the attempts over the past year to further limit free speech on the Web -- have led us to conclude that we should review the feasibility of our business operations in China," Google's Mr. Drummond wrote.

The perpetrators launched the attacks from at least six Internet addresses located in Taiwan, which is a common strategy used by Chinese hackers to mask their origin, said James Mulvenon, director of the Center for Intelligence Research and Analysis at Defense Group Inc. a national-security firm.

They also hijacked the Internet address of a San Antonio-based firm, rackspace.com, which is one of the largest data warehouses in the U.S. They siphoned off the stolen data from Google and other companies to the San Antonio site before sending it overseas, Mr. Mulvenon said.
Much of the data stolen from Google was its "core source code," Mr. Mulvenon said. "If you have the source code, you can potentially figure out how to do Google hacks that get all kinds of interesting data." Among the data, would be the information needed to identify security flaws in Google's systems, he said.
The attackers used at least seven different types of attack code to identify and steal data from Google, said Rafal Rohozinski, a principal at the SecDev Group, a Canadian security consulting firm that discovered a major Chinese spying operation on the Dalai Lama last year.

Google's revenue in China is relatively small, with analysts estimating that only a few percentage points of Google's company's nearly $22 billion in 2008 revenue came from the nation. But the country's massive number of Internet users has made it strategically important for Google, as it tried to extend its dominance in search and search advertising around the globe.

Google has struggled to gain search-market share in China, against local Chinese company Baidu Inc., which leads the market. Google's share of China's search market by revenue has been growing and stood at 29% in the second quarter of 2009, according to research firm Analysys International. Baidu's share stood at 61%.

Google's main Chinese competitors, especially Baidu, are seen as far more ready to comply with government-censorship rules, and have avoided the periodic blocking and official criticism that Google has experienced.

Google suffered another setback in September when Kai-Fu Lee, the high-profile former Microsoft Corp. executive it had hired in 2005 to lead its China operation, left to work on his own Chinese Internet venture.

Google may go the way of other Internet companies, such as eBay Inc. and Yahoo Inc., which abandoned expansion plans in China in recent years -- although none of them in the publicly critical way that Google is suggesting. Both transferred their China businesses to local players in exchange for equity stakes.

Foreign Internet companies have all struggled in China both against tough commercial competition and also government regulation and censorship.

The common assumption, however, is that no matter how onerous the limitations and challenges faced by foreign companies in China, the market is too big and important to walk away from.

That calculation has forced a number of foreign firms to accept conditions in China that they might not tolerate elsewhere. The country has 338 million Internet users as of June, more than any other country.

Google would be the most high-profile Western company in recent years to draw a line under the kind of compromises it is prepared to make and walk away from China.

It would be an extremely rare case of a foreign company taking a stand on human rights, and placing that issue over commercial considerations. A number of foreign companies exited China after the Chinese army crushed student protesters around Tiananmen Square in 1989. But they mostly came back in the following years.

A Google withdrawal would also be an implicit rejection of the argument made by many technology companies that their presence in China overall helps expand access to information for Chinese citizens, despite censorship.

—Andrew Browne contributed to this report.


Last edited by our_auctionguy; 01-12-2010 at 07:43 PM.
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