Watchful Eyes On Web's New Markets

By CBSNews.com's Christine Lagorio

Twenty-five mostly U.S.-based companies, foundations and religious groups announced Monday they will monitor the practices of Internet-sector firms in repressive countries.

This push for intellectual freedom comes in the wake of a storm of criticism of Yahoo for allegedly providing the Chinese government with information on Chinese journalist Shi Tao, who was arrested after being accused by the government of posting "state secrets" on a U.S. Web site. He has been serving a 10-year sentence since April.

As China's Internet infrastructure expands, U.S. companies such as Yahoo and Cisco Systems are working with the Chinese government to set up censored search engines and ensure that anti-government sentiment doesn't end up online, Julian Pain of the global free-speech advocacy group Reporters Without Borders said Monday at a conference in New York.

"We've been monitoring what Yahoo's been doing in China for three years. If you type 'human rights' plus 'China' in the Chinese Yahoo search engine, you get no results," Pain said.

Yahoo hasn't commented recently on its work in China, but in the past has said it had to comply with an order from the Chinese government in the case of Tao.

Two stockholding groups, Boston Common Asset Management and Domini Social Investments LLC, joined in as primary players in the new push by Reporters Without Borders to support freedom of expression in China and other repressive countries.

Although neither firm — both are known for their "socially conscious" investment philosophy — owns stock in Yahoo or Google, both deal shares of Cisco, which does business with China's government. Boston Common and Domini together drafted a shareholder proposal that will be voted upon Nov. 15 asking that the company not implicate itself in any human rights violations.

Cisco, the world's biggest maker of computer networking equipment, provided most of the equipment for the country's main Internet, ChinaNet. Groups such as Reporters Without Borders have questioned whether Cisco helps the Chinese government come up with ways to censor and monitor Internet use. But Cisco says the software it sells China is sold around the world.

Chinese government policy not only dictates formal censorship online there, but also prompts Internet users, from corporations to individuals, to censor their own online use for fear of punishment, panel members said Monday.

Such was the case for Shi Tao, who was charged with treason for allegedly forwarding government e-mail about the anniversary of the Tiananmen Square massacre. The Chinese government had previously banned all communications about the anniversary.

A second case gained widespread Western media attention recently: the case of scholar Yang Zili, who was arrested on April 20, 2001, for posting pro-Democratic ideas on his personal Web site called "Yang's Garden of Ideas." Zili is now known as a cyber-activist, though his site closely resembled today's personal blogs. It contained primarily long academic-style essays, which explored issues including urban poverty and the Chinese government's push against the Falun Gong movement.

Zili was sentenced to eight years in prison.

"In China, television, broadcast … any kind of media, are controlled by the authorities. The Internet has afforded the citizens in China space to speak freely," said Zili's wife, Lu Kun, through a translator. "However, these cases have shown that doing so is not safe."

Kun spoke Monday against the fears such censorship brings — also calling attention to the inhumane treatment her husband said he received after being arrested by the Beijing State Security Bureau.

Zili told the court it was "physically intolerable and mentally draining," Kun said. "They talked about how their chins were burned ... (and they were) hit with electric tongs."

Kun said she was not allowed contact with her husband for three years. She lost her job and apartment at the hand of the government and was told she was not allowed to speak about her husband's arrest, she said.

But Kun told her story Monday, and said she morally supports the 25 groups' push for more intellectual freedom in China.

For investors, the issue is complex. China has a booming population of Internet users numbering more than 100 million, but is a known human rights violator. Adam Kanzer, Domini's director of shareholder advocacy, said that while his company won't stop doing business with Cisco, Domini is concerned that Cisco may be implicating itself into human rights violations.

"Democracy provides the best possible environment for investment. When companies are acting against Democratic principles, that's a major concern," Kanzer said. "This creates an obligation for us to speak."

Dawn Wolfe, social research and advocacy analyst at Boston Common, agreed: "There's a lot more the companies can do that would make them not complicit in human rights violations there."

And intellectual freedom online makes good business sense, too, because censorship limits the future capacity of the Internet in repressive countries.

"Anything that quells demand threatens the future of Internet companies," Wolfe said. "As Internet traffic grows, it unequivocally benefits U.S. companies who draw profits from Internet use."

By Christine Lagorio