Thursday 24 Jan 2019 | 00:24 | SYDNEY
Thursday 24 Jan 2019 | 00:24 | SYDNEY

Beijing's online censorship stifles commerce and innovation



11 December 2014 14:58

Wuzhen, a pretty Chinese town of canals and bridges, was spiffed up for the inaugural World Internet Conference last month, with all the locals seemingly replaced by track-suited student volunteers. There was a Potemkin quality to the event, and many Western technology firms avoided showing up, fearing — rightly, as it turned out — an attempt by China to craft a new global governance agenda for the internet.

Jack Ma, Executive Chairman of Alibaba, at the World Internet Conference in Wuzhen, 19 November 2014.

Beijing unsurprisingly wants greater government control. This is yet another domain in which China (and other like-minded states) is challenging the rules established by the so-called Western liberal order. 

In many respects, Beijing has already won this battle. In its quest to 'have its voice heard' it commands attention if not grudging respect.

China has the world's largest internet population at 632 million users. Behind the Great Firewall, China has built the world's most comprehensive system of controls, with censorship of overseas sites and nearly real-time manual removal of unlawful or 'negative' content. Lu Wei at the State Internet Information Office is a confident regulator who seems to have transcended even the mighty Central Propaganda Department.

Lu reminds foreign firms they are guests in his realm. These firms have struggled in China, though whether that is due to regulatory interference or better local competitors is debatable. Meanwhile, China has sprung a highly active and dynamic indigenous internet sector. For every American web outfit there is at least one Chinese equivalent, and some have progressed from being copycats to being multi-vertical innovators in their own right. Chinese internet companies account for four of the world's ten most valuable. Foreign software firms have struggled mightily. Beijing charges the likes of Microsoft for monopoly and other transgressions, even as most Chinese use pirated Windows software (to be fair, the state itself uses authorised licenses). Fearing potential cybersecurity breaches, Beijing has campaigned against the 'IOE' (IBM, Oracle, and EM) tripartite and other multinationals, and seeks to replace them with domestic products and services.

Beijing equates internet security with national security. Its own offensive cyber capabilities are formidable. China has trumpeted mastery over quantum computing and advertises the world's fastest supercomputer.

The Party sees its legitimacy at stake, so it acts defensively too. A recent leaked instruction from the censors to Chinese editors covering Taiwan's elections reveals such insecurities: 'uniformly delete all content attacking the political system of the mainland.' Furthermore there has been a gradual ratcheting up of real-name identity requirements, a terrifying prospect for anonymous netizens. The privacy-versus-security debate, ongoing elsewhere too, leans heavily in China toward the state.

Thus it would appear, considering all the above, that Beijing is firmly prevailing in its ambition to create its Party-guided 'advanced information society.'

Not so fast, says Greg Austin at the EastWest Institute. In his book Cyber Policy in China, Austin acknowledges the extraordinary progress Chinese policymakers have made since 1987, when the first internet connection to China was established. For years Lu Wei's predecessors and their various agencies struggled to grapple with this new phenomenon. Meanwhile China has accumulated a legacy of pirated software, weak incentives for security and cutting-edge commercial innovation, and surprisingly low adoption in some respects. Business Software Alliance rates the country 19th out of 20 for readiness and reliability for cloud computing.

The Government itself reckons Chinese industrial control systems have 'grim' vulnerabilities. A separate assessment says 90% of Government websites are insecure. In building the the Great Firewall against foreign interference, Beijing may have neglected its domestic internet. Cybercrime reportedly is rife, costing Chinese companies and individuals at least as much as their American counterparts. Norton, a security firm, estimates smartphone hacks at double the global average rate. Fraud and counterfeiting are a major problem too.

The basic problem, Austin says, is obvious:

The leaders' use of advanced technologies and armies of censors to suppress errant statements, and their purveyors, appears to be 100% inconsistent with the information society ambition. The information ecosystem in China is anything but trusting and secure.

The problem with blatantly manipulating information is that citizens disbelieve everything on the internet, whether true or false. Censoring is also thought to slow down connection speeds. Scientists have difficulty accessing overseas resources. China's online community sees the internet as useful and entertaining but unreliable. Businesses are notably wary of it.

Austin foresees a fundamentally 'adversarial framing' of China's relationship with other countries: 'the US push for the technological frontier of cyber military power is aggravating (this) negative tendency...Chinese leaders feel obliged to participate in a cyber arms race they feel they didn't start...and feel they are losing.'

The tranquil waters and sunny smiles of Wuzhen's water town are deceptive. This is a fierce tussle for the future of the internet.

Photo courtesy of Reuters.

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