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China Seeks to Control the Web and Your Business Is Caught in the Middle American businesses cannot stay neutral in what is clearly now an all-out war over the future of the worldwide Internet.

By Ray Hennessey Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.


There is a war going on over the soul of the worldwide Internet, and businesses will not be able to remain neutral for long.

China is rattiling its cyber-sabers, seeking to aggressively control the Internet. The Communist government there is "pushing to rewrite the rules of the global Internet, aiming to draw the world's largest group of Internet users away from an interconnected global commons and to increasingly run parts of the Internet on China's terms," according to The Wall Street Journal.

Chinese officials, the Journal wrote, hope for "a future in which governments patrol online discourse like border-control agents, rather than let the U.S., long the world's digital leader, dictate the rules."

This comes as China has decided that the cyber world is actually closer akin to its physical geography. Indeed, a recent cybersecurity law posted by the National People's Congress views cyberspace in terms of national sovereignty.

"National sovereignty" is what wars are made of, and China has acknowledged that it is in an active cyberwar with the United States. Earlier this year, China admitted it has a military command dedicated to cyberwarfare (just as the U.S. does), and China has routinely hacked or attacked both government and private-sector information. In fact, every time there is a major cyber attack in the U.S., like recent takedowns of United Airlines or the New York Stock Exchange, China is almost always seen to be the culprit, even if other explanations arise.

This is war. Plain and simple. A new battleground, yes, without the visible devastation of an Omaha Beach, Balaclava or Cemetery Ridge, but with an even deeper impact on people's lives worldwide.

Businesses will have to wake up to this, because it means that they will have to take sides.

China is a brass ring for many U.S. businesses, not just because it's a large market but also because its inexpensive labor ensures profitability for the companies that choose to manufacture there. There's no longer a stigma attached to using Chinese factories, despite poor working conditions and complaints from the weakened American labor movement. The Chinese are partners in American growth and progress, particularly for small businesses and startups that aren't yet in the position where they can gain economies of scale from making their products domestically. It's hard to concurrently view your partner as an enemy (at least until the divorce papers are delivered).

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But war, albeit undeclared, is being waged, not even covertly anymore. If China lobbed a few missiles at Los Angeles, American businesses wouldn't think of continuing to do business there. But the Chinese cyberwar, and Beijing's plans to make a worldwide landgrab on the Internet, are being met with silence. In fact, it is less an acceptance of the warfare we are in with the country than a tolerance of it. A cost of doing business.

Look at the major Internet companies. Google, LinkedIn, Twitter and Facebook have all scrambled to get a piece of the market and have tolerated, even collaborated in, censorship the Chinese government demands. Mark Zuckerberg famously showed off his own skills in Mandarin, but China has been better at showing off its skill in banning Facebook from its users. LinkedIn set up a Chinese subsidiary last year designed to cater to Chinese rules. "While we strongly support freedom of expression," LinkedIn told The New York Times, "we recognized when we launched that we would need to adhere to the requirements of the Chinese government in order to operate in China."

Those requirements go far beyond keeping dog licenses up to date every year. Just look at the recent sex-tape controversy. A randy couple filmed their assignation in a Beijing Uniqlo dressing room, and the video, unsurprisingly, went viral. The Cyberspace Administration of China deemed the dissemination of the footage as being counter to "socialist core values" and cracked down on Internet providers in the country. That is how different China's view of the Internet is than ours. Our sex tapes spawn Kardashians. Theirs result in the arrests of five people (so far).

China isn't alone in censoring and controlling the Internet. The Islamic world routinely censors information it finds offensive. Terrorist groups are also believed to be using the Internet to attack American economic interests.

But China is the only country actively in a state of war against the U.S. online, and it's also so intertwined with our own business community, in addition to being a major buyer of our government's growing debt. That makes dealing with this cyberwar an important priority for American business.

Protectionism isn't the answer. Forget that it's contrary to capitalism and would hurt our economic growth. A protectionist approach wouldn't solve the issue. While some talk about China's Internet grab as building a new Great Wall, it's the opposite, more of a dropping of the portcullis so China can more freely enter the rest of the cyberworld and pillage American interests, priorities and ideals. If a frenzied dressing room coupling is contrary "socialist core values," how do you think they view capitalism and free markets?

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Engagement is part of the solution. Indeed, LinkedIn, in bowing to Chinese rules, also suggested that the introduction of its service in the country could have a positive effect, rooted in the "belief that the creation of economic opportunity can have a profound impact on the lives of Chinese individuals, much as it has elsewhere in the world."

That's a great goal...one China precisely wants to crush. The Internet is a raging river of freedom, an untidy home to a diversity of ideas, speech, opinion, opportunity and free commerce. It is what capitalist America sees as such an opportunity for China, and what Communist China sees as such a threat from America. It is, in short, why we are at war, and it should the number-one focus of the government and private sector here.

Yes, engagement should continue, but an understanding of the political realities, in addition to the economic opportunities, means that American companies need to be more active in taking sides in this war. Rather than collaborate with China, American businesses need to see how they can help the homefront. In a way it's self-interest: For China to be successful in its cyberwar with us, it needs to damage our economic interests. That means addling the very companies now paying court to Beijing.

Hopefully change will occur in China and that country will open up further, realizing that free expression, and free markets, are agents of good not ill. Maybe even these words written here will change a mind or two. More likely, the Chinese censors, in an act of war, will censor them first.

Related: The Myth of the Have-Nots

Ray Hennessey

Former Editorial Director at Entrepreneur Media

Ray Hennessey is the former editorial director of Entrepreneur.

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