Google Not Only Target of China Hackers

Google logo, and China Flag-map with code
In cyberspace this week, there's a heavyweight battle pitting China against Google, as well as American businesses. CBS News correspondent John Blackstone has more.

At first it seemed to be a cyber attack aimed at those who organized protests against China's control of Tibet. Still Tenzin Seldon, a student at Stanford, was surprised when Google told her someone in China was reading her e-mail.

"Actually there is a saying in our community that if you're not being watched by the Chinese government, you are probably not doing the best you can," Seldon said. "These hackers had to use some kind of high tech things which they could have access to my password."

But Google discovered this was much more than an attack on the e-mail of one Chinese human rights activist. Not only was Google itself a target of the cyber-spies, but so were at least 20 other major corporations.

"This is not a Google story," said Peter Navarro, author of "The Coming China Wars." "It is a story about industrial espionage, coming from China, attacking American business and our economy."

Navarro says the companies believed to have been attacked include Dow Chemical and Northrop Grumman.

"When they hack American business enterprises, it is a covert act of war on our economy at a time when their economy is growing at over 10 percent and we have a 10 percent unemployment rate," Navarro said.

At a place where they battle hackers every day, the computer security company McAfee, George Kurtz says the attacks were sophisticated and precisely targeted, "designed to get in, cover its tracks and steal corporate secrets and get out."

And for the companies involved, those secrets are valuable.

"Think about the amount of money they spend on [research and development] on a yearly basis -billions of dollars," Kurtz said. "Having trade secrets and potentially source code taken can be very damaging to them.

"One of the huge drivers of Chinese economic growth over the last several decades has been the forced technology transfer from America to China," Navarro said.

While there is no proof the Chinese government itself was involved in the attacks, Tenzin Seldon says American companies hoping to profit in China should beware.

"It is not them that has owned China; it is China that has owned them," Seldon said.

As others now look to protect themselves from Chinese hackers, China itself strictly censors the Internet behind what's been called "the Great Firewall."