Stuart Loory, Lee Hills Chair in Free-Press Studies, Missouri School of Journalism: For the past month, cyberwarfare has been an issue between Google, the huge American company that runs the most popular search engine in the world, and the government of China. Google claims hackers from China broke into Google servers and monitored the Google e-mail accounts of several Chinese citizens. Google has threatened to close its offices in China and shut down its Chinese-language search operation to avoid censorship. Chinese officials said the country is not doing anything wrong and that organizations operating in China must obey Chinese law. Secretary of State Hillary Clinton criticized China’s attempts to control the Internet. China replied that it is the greatest victim of cyberwarfare. Is China behind these attacks?
Kathleen McLaughlin, correspondent, Global Post; Beijing: I think at this point no one knows. The Chinese government was fairly silent in the first few days after Google made their announcement on their official blog, and now the Chinese government has really come out swinging. What makes it so interesting is that American companies who do business in China often agree to do things like censor Internet search results or allow the Chinese government to monitor e-mail accounts. Google made a big deal of saying we’re not going to give over specific information, and on our Chinese language site, we’re going to tell people that the information is censored. What it did is increase awareness about censorship. When a Chinese user would use Google.cn, they get search results that have a disclaimer on them that said these results were filtered according to government regulations. The question for Chinese Internet users is: What happens if Google does leave? It’s like a page-turner novel.
Loory: What does it look like from the United States? How serious is Google in saying that it may pull out?
Mike Swift, technology reporter, San Jose Mercury News; Palo Alto, California: I think Google is very serious about leaving China. Originally, it was seen here as a very altruistic move, but I think the narrative has shifted. There has been a growing awareness that this attack really threatened the heart of Google’s business model. The fact that somebody in China was able to use a very sophisticated attack using malicious software to penetrate Google’s core systems to access these accounts really threatens Google’s feelings of security.
Loory: But hackers around the world break into servers all the time, yet it doesn’t seem to become a big issue except that it happened in China.
Swift: This was an attack that penetrated Google’s core system. The hackers exploited a vulnerability in Microsoft Internet Explorer, and they didn’t only target Google. There are reports that as many as 34 companies were affected by this very sophisticated attack. It exposed how vulnerable a lot of these systems are. I think that is what made this attack different — not so much that it came from China. Google said they do not have ironclad evidence that the Chinese government was behind the attacks. A hack like this is very difficult to find the original fingerprints for who initiated it. However, Google officials met with Clinton, and within 48 hours, she said we’re looking to the government of China for an explanation.
Loory: Does this attack concern the Taiwanese government?
Joyce Huang, deputy business editor, Taipei Times; Taipei, Taiwan: Something like this attack is absolutely inexcusable for Taiwan because Taiwan went through its own censorship many years ago. We transitioned from an authoritarian regime to a democratic government. We put a high emphasis on the free flow of information. I would say that anyone here in Taiwan is unlikely to take part in the cyberattack, but technology-wise this island has the capacity to do so.
Loory: This story is of great interest around the world, including in Europe. What is all the excitement about in Europe?
Wilfried Ruetten, director, European Journalism Centre; Maastricht, Netherlands: I think it changed from a technology story to a political story, and Google is showing everyone else how challenging Chinese censorship should be done. Google is interested in its business, yet they have more leverage than the whole press corps.
McLaughlin: Part of the reason the story is shocking is because Western companies doing business in China simply don’t criticize the Chinese government. For a company of Google’s size and power to really criticize poor policies in China was shocking and fascinating. Keep in mind that Yahoo took a huge image blow in China when it turned over confidential e-mail information to the Chinese government and a Chinese journalist was jailed because of that information. I can’t imagine that Google would want to be in cahoots with the Chinese government in possibly putting someone in jail.
Loory: When Google started in China a few years ago, it accepted the idea that it had to practice some censorship. Is it backing down on censorship at the present time?
Swift: Eric Schmidt, Google’s chief executive officer, said Google remains very committed to doing business in China and would like to stay there. However, Schmidt said Google will turn off censorship on its search engine in a reasonably short time. There is some speculation that there may be conflict between the three people who run Google — the two founders, Larry Page and Sergey Brin, and Eric Schmidt, the CEO. Brin’s family came from the Soviet Union, and he has a very visceral reaction to government censorship. He was not very happy about accepting the terms of doing business in China. There is some speculation that there may be discord between Schmidt, who sees the business possibilities of staying in China, and Brin, who is less willing to accept the devil’s bargain of staying there.
Loory: The Chinese search engine Baidu has more clients in China than Google. Is Google excited about what’s going on because it is not competing as well as it wants to?
McLaughlin: Baidu has a two-thirds market share in China, and Baidu has been around a lot longer. It is a domestic company, and they might know the Chinese audience better. Google is more appealing to intellectuals and progressive thinkers who want different kinds of information. Google is the hipster search engine.
Swift: Google is very much a distant second to Baidu in China. Google’s revenues in China are estimated to be no more than $300 million, which is a drop in the bucket of their $22 billion annual revenue. Right now, China is not a hugely lucrative market for Google. The question is: What will be in the future, especially with Google now moving into mobile Internet technology?
Loory: How does Google make its money?
Swift: Google is essentially the most successful advertising platform in history. About 97 percent of their revenue comes from an auction they hold on keywords. People who want their site to get hits through Google bid to purchase a keyword, whether it’s "garbage disposal" or "umbrellas" or whatever. You pay Google so your site moves up, and you’re more likely to get a hit when someone searches for that term. Google is hoping in the future to gain a lot more money from mobile searches, especially in countries like China where a greater proportion of Internet users access the Internet through a mobile phone.
Loory: This way of selling advertising is hurting conventional news organizations and entertainment organizations, not only in the U.S. but also in Europe, correct?
Ruetten: Correct. How can you beat free? If you give something away for free, there is no business model left for anybody else to make any money. Audiences are becoming smaller and more marginalized. It’s not the big show and everyone is listening to it — there are hundreds of thousands of voices. This is especially threatening for the aggregators who bundle the voices to make money. May I make one remark about this government involvement in hacking? Every country is attacking every other country’s infrastructure. The U.S., Russia, France, Germany, Israel and China all do it. I thought what Clinton said was a little awkward because everybody is constantly attacking everybody else. Why make a big fuss out of it now?
Loory: So do we now have to add the term "cyberwar" to hot war, Cold War and war on terrorism as an international threat? And is the world and warfare of science fiction now becoming fact?
Producers of Global Journalist are Missouri School of Journalism graduate students Youn-Joo Park, Angela Potrykus, Melissa Ulbricht, Timothy Wall and Megan Wiegand. The transcriber is Pat Kelley.