Google Postpones Mobile Phone Launch After China Dispute

BEIJING, Jan. 19, 2010 — -- Google has postponed the launch of its mobile phone in China amid a dispute with the government about Internet censorship.

The formal launch of the phone scheduled for Wednesday was postponed, Google spokeswoman Marsha Wang said, declining to give a reason or say when it might take place.

The postponement came a week after Google announced it was considering pulling out of China after discovering that it had been the target of cyber-attacks aimed at accessing e-mail accounts of human rights activists in China and abroad.

At least two Gmail accounts of foreign journalists in Beijing, including one at Associated Press television, have also been hacked, according to the Foreign Correspondents Club of China.

The group said that the journalists' e-mails had "been forwarded to a stranger's address," and warned that "journalists in China have been particular targets of hacker attacks in the last two years."

Google is also reportedly investigating whether the cyber-attacks were facilitated by someone within Google's China offices. Google is not commenting on the allegations of an "inside job."

Some experts say that Google employees could have unwittingly participated in the hackings by being victims of the cyber-attacks themselves. Local Chinese media reported that some Google China staff members had been denied access to internal networks and other employees had been transferred to other offices in the Asia Pacific region.

Dan Brody, Google's first employee in China who now runs an Internet media investment company here, is skeptical of the reports of an inside job. "This was a public attack. Code is written to run a huge number of servers," Brody said. "This sort of hacking doesn't necessarily have anything to do with the code."

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Security analysts have said the malicious software (malware) is a modified Trojan horse that allows the hackers unauthorized access once inside. The hackers changed Gmail settings so that all messages would be forwarded to unfamiliar addresses.

They used the same tactics to hack the journalists' accounts as they used to access the accounts of human rights activists, including Teng Biao, a Beijing human rights lawyer, and Ai Weiwei, an outspoken artist and advocate of parents in the quake zone.

Talks between Google and the Chinese government are expected to begin this week. Google says that it will pull out of China unless it is allowed to run an uncensored search engine.

China's foreign ministry reiterated a commonly heard refrain here today at a regularly scheduled news briefing. "Foreign firms in China should respect China's laws and regulations and respect China's public customs and traditions, and assume the corresponding social responsibilities, and of course Google is no exception," Ma Zhouxu said.

Brody. who runs the Chinese investment company, said recent developments do not bode well for the industry in China. "Baidu will now be a monopoly player and that is not good for anybody," he said of the Chinese Internet search engine.

All the other large Internet players have already pulled out of China. "Google was the last man standing in terms of foreign Internet companies in China," Brody said.

"It's a shame. We looked at Google as a white beacon, a light of hope that such a company could succeed here. But it doesn't look like that is working out after all."

The Associated Press contributed to the reporting of this story.