Virtual China: Information Technology - Press Reviews, August 1, 1999

Weekly Press Review

August 1, 1999

The Chinese government last week fought back against the worldwide meditation movement Falun Gong with not only its traditional tools - televisions, newspapers, and Communist Party 're-education' sessions - but, most notably, with the Internet.

Several webmasters in the U.S. and Canada who operate or host Falun Gong websites said their sites were attacked by hackers whose Internet addresses traced to Chinese government offices, according to reports by the Associated Press and Wired News.

Bob McWee, a Falun Gong follower from Middletown, Maryland, said that a website that he maintains, www.falunusa.net, was bombarded by electronic requests for service - a common hacking trick designed to disable a website.

McWee said he traced the Internet address of the requests to two Beijing telephone numbers. When an Associated Press reporter called those numbers they were told they had reached the Public Security Ministry's Internet Monitoring Bureau.

Furthermore, both McWee and another webmaster, Greg Alexander, an ISP operator in Burlington, Ontario, say they received phone calls from the U.S. Department of Transportation inquiring about uninvited attempts to contact servers there, including one at the Federation Aviation Administration.

Neither McWee or Alexander has initiated those contacts, they said, and further research revealed that another party, again tracing to a Beijing government office, had apparently made those contacts using McWee's and Alexander's web addresses as a cover.

The full import of these events was hardly clear by week's end, although nagging fears arose that they may herald cross-border Internet hacking as the newest means of Communist Party control. Within China, websites with information on the Falun Gong were shut down, and the e-mail accounts of some followers also were also apparently jammed.

Certainly, these events signal that Beijing remains, as it has been for the past several years, profoundly split on the Internet. On the one hand, it enthusiastically embraces the net as a technology to promote economic growth. On the other, the ability of the Internet to give outsider groups the means to organize and to disseminate information clearly gives Beijing a shudder.

Today it's the relatively benign Falun Gong that used the Internet to pull off the magic trick of suddenly materializing, en masse, at the doorstep of party headquarters in Beijing. What if, tomorrow, it is the international democracy movement, or disaffected student groups, or labor unions that grasp the Internet as their tool to challenge Beijing?

Elsewhere in China's Internet world last week, plenty of news proved that despite the unfolding of giant questions of governance and state control, the Internet industry continues to boom in China.

Both Chinese and foreign companies, and for that matter the government itself, continue to pour resources into new Internet companies and services.

Netscape released a new Chinese language browser, Communicator 4.51, and upgraded its Chinese-language services on ChinaNetcenter, a portal site, to include AOL's Instant Messenger service and some local news and feature stories.

Great Wall, one of China's biggest PC manufacturers, also announced last week that in future it will look not so much to the PC market as to Internet services for its major growth. It will kick off that commitment with a US$10 million investment in broadband satellite Internet services, according to Wang Zhirong, Great Wall's executive director and vice president.

For its part, Beijing announced the start of two new Internet services in China, one educational, the other for e-commerce. The Long-Distance College of Beijing University has recently started China's largest online University, with 31 remote classrooms across the country, according to the People's Daily newspaper. And the Liberation Daily newspaper reported the launch of a new online grocery delivery service in Shanghai, to be run by the Municipal Grain Stock and Transportation Company and the Shanghai Meilin-Zhengguanghe Group.

Finally, several bits of IPO news from China last week. Two Taiwan-based portals, yam.com and kimo.com, are "relatively certain" to go public, probably on the NASDAQ exchange, according to Asia Internet News.

Sina.com, the Chinese-language portal run from offices in Silicon Valley and Beijing, also said it plans to sell public shares within a year, according to South China Morning Post. Dong Yongji, the president of Stone Electronic Technology, the major shareholder in Sina.com, said the offering should raise nearly US$100 million.

And China.com, the Hong Kong-based Chinese language portal who three weeks ago held a tremendously successful offering of shares on NASDAQ, announced last week that it would indeed give employees the option to buy shares for US$13.27 per share, well below last Friday's closing price of US$44.93. China.com had raised some eyebrows after its IPO after word got out that it had no plans to reward employees with stock options, which is standard procedure at internet startup companies in the United States.

Current Review

October 22, 1999

Past Reviews

	September 10 19 24
	August 1 8 13 20 29
	July 12 19 26
	June 7 14 21 28
	May 3 10 24
	April 7 14 26
	March 3 10 17 24 31
	February 3 10
	January 6 13 20 27