Google is considering moving its operations out of China, after discovering a cyberattack Tuesday on its computers in the country.
David Drummond, Google corporate development and chief legal
officer, wrote in a blog post that it had uncovered a "highly sophisticated and targeted attack on our corporate
infrastructure originating from China."
The Mountain View, Calif. company says it has evidence that suggests the attacker's primary goal was accessing the Gmail accounts of Chinese human rights
activists. Only two Gmail accounts appear to have been accessed, and activity was limited to account information, such as the date the account was created, and subject line, rather than the content of
emails themselves.
It also has evidence that Gmail accounts held by dozens of advocates of human rights in China based in the United States, China and Europe appear to have been routinely
accessed by third parties. These accounts have not been accessed through any security breach at Google, but most likely through phishing scams or malware placed on computers.
Google was not the
only company targeted. At least twenty other large companies from a range of businesses -- including Internet, finance, technology, media and chemical sectors -- were similarly targeted, too, Drummond
explained. "We are currently in the process of notifying those companies, and we are also working with the relevant U.S. authorities," he wrote.
J.P. Morgan Analyst Imran Khan estimates that
Google will generate about $600 million in revenue from China in 2010. However, if Google is not allowed to operate in China, beyond the immediate revenue loss, this could potentially have a
far-reaching impact on the company's overall long-term growth rate," according to a research note. "If Google shuts down Google.cn, we believe Baidu would likely benefit from better user experience,
because Google.com servers located outside China will likely have larger latency; and local advertisers more likely to increase marketing budget with Baidu given lack of large-scale advertising search
alternatives."
But Baidu had its share of problems, too. Baidu reported that the same group that defaced Twitter in December took China's leading search engine offline for four hours on Tuesday.
The domain name registration in the United States was tampered with. The group that defaced Baidu claims to have ties to Middle Eastern countries.