An Economic Analysis of China’s Internet Censorship

September 28, 2006 at 11:00 pm (China, Internet, Politics)

China Digital Times has a delicious story on China’s Internet censorship told by an inside man.

China’s government spends tons of money, the tax payers’ money, on monitoring and controlling the online behaviors of tax payers. More over, Internet surveillance and control have been a lucrative source of profits and budgets to some government administrations, most prominently the Ministry of Public Security and the Ministry of Information Industry, two powerful administrations that often compete fiercely on state budget.

Internet censorship is a special market, where the suppliers are a few administrations and their conspirators–those facility and technique suppliers. And the buyers are, well, not the tax payers, but the communist party.

So it’s a market with competitive suppliers but only one buyer. Definitely a buyer’s monopolistic market.

I strongly recommend economists to join in the research on China’s internet censorship, where human rights activists and academics from political, social and technical circles have invested huge amounts of time.

With my shallow economic knowledge, what I observed is that in a buyer’s market, suppliers will make their best endeavors to seduce buyer’s attention. And their services will be increasingly solid, cutting-edge and even breath-taking. That’s why the lives of China’s Internet users are getting worse.

Hopefully we will have a counter-censorship market that could be as monopolistic as the censorship market is. Unfortunately, in the counter-censorship market, there are a slew of demands but only sprinkling supplies. To make things worse, buyers in this market are usually penniless, and suppliers are largely voluntary.

Since Mao’s “marvelous” people’s communal economy, when was the last time you witnessed a durable voluntary economy?


Story from China Digital Times (translated by CDT):


I am a network manager of a telecom company (sorry I don’t dare to disclose the name of our company).

I can confirm that the operating unit which is responsible for blocking and filtering the national gateways belongs to the Ministry of Information Industry. Before we can expand our bandwidth, we have to ask for their permission, and tip them a “surveillance and control fee.” They are shameless.

Additional administrations are involved in the surveillance and control of our provincial and municipal networks, including the Ministry of Public Security, the Ministry of State Security, the Commission for Discipline Inspection, the Army, etc. Their operations often stress the limits of our capacity.

A few days ago, a deputy director of the Bureau of Internet Monitoring of the Ministry of Public Security, whose name is Gu Jian (顾坚), had a conversation with us about renting our bandwidth. He said the state government allocated a large amount of funds for the use of the online information surveillance and control project.

How could a Bureau of Internet Monitoring have this huge amount of money? We were suspicious. We managed to unearth the truth using our connections with the Information and Telecom Bureau and the Golden Shield Project of the Ministry of Public Security. They were surprised too, and said it was impossible because leasing bandwidth is the business of the Information and Telecom Bureau.

Later on we discovered that the project Gu Jian was talking about has nothing to do with bandwidth leasing. What the project really needs is an interface on our network for monitoring purposes. Gu, however, was asking to rent our commercial use bandwidth, which is not related to interface monitoring.

The undisclosed aim of the Bureau of Internet Supervision and Beijing Municipal Department of Internet Supervision (a director named Yu Bing (于兵) from the municipal department joined Gu Jian in the visit) was to use the excuse of information monitoring to lease our bandwidth with extremely low prices, and then sell the bandwidth to business users with high prices to reap lucrative profits. How avaricious they are!

There is no doubt that the name of the chief of the Bureau of Internet Monitoring is Li Zhao (李昭). According to what Gu Jian said, chief Li is known for his political savvy. He used to be the deputy chief of the Bureau of Political Security (政保局). After he was promoted to the chief of Internet Monitoring, he reshaped the bureau, which was originally a small organization with merely 20 to 30 staffers, to a big one with as many as 200 people. The bureau used to work on anti-virus projects, and was on the brink of being disbanded. Li shifted the bureau’s function to Internet political security, and turned Internet Monitoring into a 24-hour online alarm bell (This makes the bureau something like an online Ministry of Public Security).

According to what Gu told us: Li’s political savvy won him acknowledgement and recognition from Minister of Public Security and other state leaders. He may soon be promoted to the Minister of Public Security!

We joked with Gu Jian: since Li ascended to be the minister, you could be the deputy minister.

Gu dismissed the joke indifferently, saying that his parents and relatives all worked as ministers. The former minister, whose surname is Tao, was the underling of his father, he said. The incumbent minister Zhou Yongkang, who is also the deputy secretary of the Committee of Political Science and Law, always paid respect to his parents during new-year holidays and other festivals. And the deputy ministers are his buddies. So it doesn’t matter whether he can be the minister.

The administration in charge of China’s Internet gatway access restriction is a bureau under the Ministry of Information Industry, its full title is “National Management Center of Internet and Information Security” 国家计算机网络与信息安全管理中心. It is located at a building 1000 meters northeast of Madian Bridge, third north ring road, in Beijing. The head is Fang Binxing, (方滨兴) who used to be a teacher at the Internet center of Harbin Institute of Technology, and was picked up by the ministry’s Zhang Chunjiang to manage Internet censorship.

The so-called “Information Gateway” they are working on consists of a large number of servers sitting on the international interfaces of China’s Internet. The gateways monitor the information flow, and send out fake TCP packages to cut the TCP connections as soon as specific keywords are detected.

The organizations executing the gateway project are a few companies owned by Harbin Institute of Technology. Another company called VenusTech Ltd.” (启明星辰信息技术有限公司) is also involved in the manufacture of a set of backup facilities.

It is said that Fang is applying for the membership of China Academy of Sciences. He is well credited for the huge, billion-yuan Internet censorship project.

Witnessing the remarkable accomplishments and benefits of Ministry of Information Industry’s Information Gateway project, the Ministry of Public Security has been getting jealous. It then considered imposing monitoring on all provincial and municipal Internet interfaces and on the interfaces of large-scale IDCs. The ministry invested a huge amount of money on their own project. A friend of mine recently attended one of their tests on IDC monitoring facilities.

A PhD from the Ministry of Public Security asked our company to submit a project proposal which involves building a high group computing power (hundreds of thousands billion times per second) with several thousands Tara Bits storage capacity.


According to what I know, our boss has presented two versions of the proposals. He is also in close contact with that PhD’s boss. It seems our company is confident in winning the contract. The Bureau of Internet Monitoring has been engaged in a wide range of search for experts and companies able to design a billion-yuan system.

As soon as the system is put into service, all behaviors of Chinese Internet users will be recorded in the huge storage. Your online account, password, and conversation records will be under tight surveillance. And your online behavior can be traced back up to a year.

A few days ago, after the PhD from the Ministry of Public Security stopped by our company and asked for the technical solution of the immense-capacity, immense-capability system, our boss told us privately that in the future, there will be no online privacy anymore. Don’t use the Internet, he said. At that time we all thought he was only joking.

It was also said that the fund supporting this project is not from the Golden Shield Project. It’s directly from the federal fiscal budget.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: