American companies are at war, but don’t ask them why. They won’t tell. They’re besieged not by one another, but by hackers who target their intellectual property and confidential information. Just how deep this cyberwar goes is largely unknown to all but the companies being targeted. That’s because they are staying silent in an effort to not aggravate the countries in which they are being hacked. China is the site of the most cyber-aggression, and in many instances, the biggest opportunity for many businesses. Companies are turning the other cheek in an attempt to turn another check.
If the companies are not talking, how do we know it’s happening? Because the U.S. government has noticed. On Tuesday, The New York Times ran a piece highlighting the link between anti-U.S. cyberattacks and the Chinese military. In the Washington Post last week, word leaked that the United States has put out a National Intelligence Estimate that “identifies China as the country most aggressively seeking to penetrate the computer systems of American businesses and institutions to gain access to data that could be used for economic gain.”
This is the front in the U.S. cyberwar that we’re not winning. We know the U.S. does fine when it comes to its sovereign cyber-warfare, waged on a state-to-state platform. Take Stuxnet — the US/Israel initiative to destroy Iranian nuclear centrifuges through a complex cyberattack (not to mention an odd follow-up that purportedly blasted AC/DC’s ”Thunderstruck” at odd hours). But when it comes to corporate sabotage and espionage, the United States is far less experienced than China. Blame free-market capitalism: The U.S. government does not intervene on the private sector’s behalf to obtain information that would benefit the economy. China, however, is far more adept at this because of its use of state capitalism (a system in which the state uses markets to create wealth that can consolidate its hold on power).
Yes, Obama announced some cyber-security proposals in his State of the Union address. But any broad initiative to combat corporate cyber-espionage will have to come from corporate entities themselves. So why haven’t we heard about such efforts? Swaths of companies are getting hit, as the leaked elements of the National Intelligence Estimate imply, but they fear losing business from the world’s second-largest economy and its largest trader (in terms of value of goods and services sold).
We’ve seen at least one company push back against China’s repressive policies in the past: Google famously moved its Chinese searches to a Hong Kong URL so it could avoid Chinese Web censorship. But Microsoft saw Google’s exit as an opportunity. Referring directly to Google’s decision to leave, Microsoft’s chief research and strategy officer proclaimed, “Microsoft is committed to stay.” Google has paid a price: Its share of search in China is down from about a third to somewhere around 5 percent, lagging far behind its Chinese competitor, Baidu, which controls the majority. Baidu, of course, has close ties to the Chinese government.