Military warns of 'increasingly active' cyber-threat from China

As Google, Go Daddy reconsider China, will other businesses think again?

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University of Notre Dame professor John D'Arcy, who conducts research on information security and computer ethics, says Google decisions puts a little pressure on China, and said if U.S. firms feel any pause at all in dealing with that country, it is because more and more cyber attacks are being linked back to China.

"Companies would be a little bit suspicious because in general the Chinese government has not done anything to curb this activity," he said.

But China's importance to U.S. firms is huge, and Dell Inc. is only the most recent company to illustrate why.

There was a brief eye-opening moment this week when it appeared as if the Google's exodus from China was about to escalate in a big way.

India's Prime Minister, Manmohan Singh, was reported to have said in speech that Dell was planning to shift some production out of China because it wanted safer environment. CEO Michael Dell had recently met with Singh.

The statement came from account distributed by the India Press Information Bureau, according to various press reports. But David Frink, a Dell spokesman said in an interview, that was a "misinterpretation of his remarks."

Dell has 5,000 employees in China and two manufacturing facilities. In a statement released by Dell, the company said in that in its meeting with Singh, they discussed "ways of building India's hardware manufacturing eco-system."

In this context, Mr. Dell said that the company spends about $25 billion annually on sourcing components from its suppliers in China. With the right kind of progress, Mr. Dell said that he believes India also has an "opportunity to become a hardware manufacturing hub, generating employment and adding to that country's impressive growth."

Patrick Thibodeau covers SaaS and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at  @DCgov or subscribe to Patrick's RSS feed . His e-mail address is

Copyright © 2010 IDG Communications, Inc.

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