(BN) Google Said to Have Tried to Get Support Over Attack

[Dave Farber <dave () farber net>]

Begin forwarded message:

> From: "CONNIE GUGLIELMO, BLOOMBERG/ NEWSROOM:" <cguglielmo1 () bloomberg net 
> >
> Date: January 15, 2010 1:13:16 PM EST
> To: dave () farber net
> Subject: (BN) Google Said to Have Tried to Get Support Over Attack

> Another story you might be interested in...
>
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> Google Said to Have Tried to Get Support Over Attack (Update2)
> 2010-01-15 14:37:38.419 GMT
>
>
>     (Updates share price in 10th paragraph.)
>
> By Ari Levy, Brian Womack and Rochelle Garner
>     Jan. 15 (Bloomberg) -- Google Inc. approached other
> companies to seek their help drawing attention to a cyber attack
> from China last month and was frustrated by their reluctance to
> come forward, according to a person familiar with the matter.
>     Google announced this week that it was one of at least 20
> companies targeted in a “highly sophisticated” computer attack
> and wanted others to talk about the incident, the person said.
> The companies refused, and Google made the announcement by
> itself, the person said.
>     Since then, three other companies, Adobe Systems Inc.,
> Juniper Networks Inc. and Rackspace Hosting Inc., have said they
> were targeted by cyber attacks. The reluctance of companies to
> join Google in its initial announcement illustrates the pressure
> on them to protect their business in China, the world’s third-
> largest economy, said Barry James, who helps manage $2 billion
> at James Investment Research in Xenia, Ohio.
>     “Companies are not going to be cutting off their nose to
> spite their face,” James said. “It’s an underlying problem
> that exists in terms of dealing with a country where they don’t
> necessarily follow all the same rules that we do. More
> experienced firms have a better grip on how to navigate that.”
>     In disclosing the attacks, Google said it plans to stop
> censoring Web-search results in China, a move that may lead to
> the closing of its Chinese site and offices in the country.
> Mountain View, California-based Google said the attacks were
> directed at e-mail accounts of human-rights activists.
>     Jill Hazelbaker, a spokeswoman for Google, declined to
> comment on how the company handled the matter.
>
>                          China Revenue
>
>     Google probably can afford to leave China, said Marshall
> Meyer, a professor of management at the University of
> Pennsylvania’s Wharton School.
>     “If they were making a lot of money, I don’t think they’d
> do this,” said Meyer, who teaches an MBA course on how
> companies operate in China. “You have to cultivate good
> relationships with the government -- no way around it.”
>     Less than 2 percent of Google’s $21.8 billion in revenue
> came from China last year, according to Jefferies & Co. By
> comparison, China accounted for 13 percent of Intel Corp.’s
> sales in 2008, the last time the company disclosed results from
> the country. Cisco Systems Inc. made 11 percent of its revenue
> from the Asia Pacific region, excluding Japan, in the most
> recent quarter.
>     Google rose $1.87 to $591.72 at 9:32 a.m. New York time on
> the Nasdaq Stock Market. The stock has almost doubled in the
> past year.
>
>                       ‘All About Profit’
>
>     Dan Slane, chairman of the U.S.-China Economic and Security
> Review Commission, a federal agency, said he was surprised more
> companies aren’t standing up with Google.
>     “It’s all about profit, and I understand where the silence
> is coming from, but they are missing the long-term picture,”
> Slane said in an interview. Chinese leaders’ “end game is to
> extract as much technology out of American companies as they
> can, transfer that to their own companies and, when they feel
> those companies have reached a level of technical maturity, show
> the American companies the door.”
>     Google co-founder Sergey Brin pushed the company’s
> executives to take a stand against the attacks and end its
> censorship of Web-search results in China, according to another
> person familiar with the matter. As part of the discussion,
> Google executives analyzed the financial effect of the company
> leaving China, the person said.
>     Yahoo! Inc., the second most used U.S. search engine, was
> also among the companies targeted by the attack in China, a
> person familiar with the matter said this week. Yahoo, which
> said it “stands aligned” with Google in condemning Chinese
> cyber attacks on users, said that it doesn’t generally disclose
> attacks on its computer systems.
>
>                       Microsoft’s Stance
>
>     Technology companies such as Microsoft Corp. and Intel have
> spent years building businesses in China, the world’s largest
> Internet and mobile-phone market.
>     Microsoft Chief Executive Officer Steve Ballmer said
> yesterday in an interview with Bloomberg Television that his
> company intends to stay in China and wants to be “part of the
> solution” in the country.
>     Intel, the world’s biggest chipmaker, said there is no
> change in its view of the Chinese market and it hadn’t seen
> evidence of a “broad-based attack” on its systems.
>     “We have nothing to say concerning other companies’
> views” of the Chinese market, said Chuck Mulloy, a spokesman
> for the Santa Clara, California-based company.
>     Cisco, the world’s largest maker of networking equipment,
> said it’s closely following discussions of censorship in China.
>     “As Cisco is not a service or content provider and doesn’t
> participate in the censorship of information by any government,
> we cannot comment regarding the specifics of any of our industry
> peers,” the San Jose, California-based company said in a
> statement.
>
> For Related News and Information:
> For Google’s sales: GOOG US <Equity> PGEO CHART <GO>
> For Google’s shares: GOOG US <EQUITY> COMP <GO>
> For top technology stories: TTOP <GO>
> For the top U.S. technology companies:
> S5INFT <INDEX> RV <GO>
>
> --With assistance from Ian King in San Francisco. Editors:
> Jonathan Thaw, Jeffrey Taylor, Stephen West
>
> To contact the reporters on this story:
> Brian Womack in San Francisco at +1-415-617-7218 or
> bwomack1 () bloomberg net;
> Rochelle Garner in San Francisco at +1-415-617-7136 or
> rgarner4 () bloomberg net;
> Ari Levy in San Francisco at +1-415-617-7133 or
> alevy5 () bloomberg net
>
> To contact the editor responsible for this story:
> Jonathan Thaw at +1-415-617-7168 or
> jthaw () bloomberg net



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