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The Real Cyberthreat to U.S. Business: Chinese College Kids

American companies should be hoping that the recent cyberattacks against Google (GOOG) and dozens of other U.S. firms were in fact instigated by the Chinese government. Because the alternative is far scarier -- a loose collection of nationalist teenagers whose idea of a good time is sophisticated corporate espionage at an unprecedented level.

Hackers in China are completely different from their counterparts in the West. A 2005 Shanghai Academy of Social Sciences survey compared hackers to rock stars. Nationalism is cool and fame is cultivated through the Web. The study found that 43 percent of elementary-school children "adore" China's hackers. One third say they want to be a hacker when they grow up.

Shanghai's Jiantong University, where the Google hack originated according to the NSA, is ground zero for this culture. While the school has denied any official involvement, it's unlikely the hackers would have asked their dean for permission. A leading professor of computer security at Jiaotong told the NYT, "I'm not surprised. Actually students hacking into foreign Web sites is quite normal."

The line between students hackers, security professionals and government agents is porous on campus. Take Peng Yinan - aka coolswallow - who began life as an ordinary student at Jiantong. While there he formed a hacking group that claimed responsibility for attacks on several government and business websites -- including the 2001 takedown of After graduation he served briefly as a consultant for the Shanghai Municipal Bureau of Public Security. In March of 2008 he was one of three graduates invited back to give a career talk at Jiantong. OK, but these are college kids, right? They can't compete with top level cyber security. Well these aren't just any students. Students from Jiantong's computer science program just won IBM's international "Battle of the Brains", beating out top American schools like Stanford, Cornell and Columbia. The contest is more more military drill than spelling bee.

"The contest pits teams of three university students against eight or more complex, real-world problems, with a grueling five-hour deadline," says I.B.M.'s website. "Huddled around a single computer, competitors race against the clock in a battle of logic, strategy, and mental endurance."
In recent years China has stiffened laws that make hacking a crime, but a young hacker recently told the NYT that the rules are loosely enforced and that freelancing for the government is common. So what can American business do to protect itself? The rapid response from the NSA shows one potential path for U.S. firms, teaming up with the sophisticated defense operations of government agencies. Another might be to work at fostering cyber-security at the university level, as China is clearly doing. Of course, we could always try the end around. Microsoft and Intel have moved into a research park just off campus in the hopes of tapping some talent. And as winners of the Battle of the Brains, students from Shanghai Jiantong University have a guaranteed offer of employment or internship with IBM. Image by