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Upon discovering that it had been hacked by China, the Canadian government’s scientific-research body did digital damage control on an enormous scale. Firing up its vintage fax machines, it jettisoned scores of computer servers, bought its staff hundreds of new laptops and drew up a list of about 20,000 corporate partners in Canada whose secrets risked being collateral damage.

Records newly released to The Globe and Mail reveal these and other details about the extensive fallout from this nightmare at the National Research Council. The hack of the NRC was highlighted in July 2014, when the then-Conservative government blamed China, making it the only cyber-espionage campaign that Canada has ever pinned on a specific state adversary.

While hacks of government departments occur relatively routinely, the NRC could be considered a more valuable target than most. For decades, it has been routing tax dollars to fund cutting-edge research in agriculture, engineering and computer science. Placing bets on Canadian companies helps the NRC work to ensure future prosperity, and its staff gets a glimpse of emerging technologies and proprietary business plans. 

That’s why the Canadian government was alarmed when federal officials announced two years ago that they had “detected and confirmed a cyber intrusion” within the NRC by “a highly sophisticated Chinese state-sponsored actor.”

But while prime minister Stephen Harper's government took the unprecedented step of allowing officials to make the controversy public, it remains unknown how or when Chinese hackers first infiltrated the NRC’s computer systems, or what drew them to it in the first place.

The records released to The Globe under the Access to Information Act show only the aftermath. Job No. 1 at the agency was to warn the “clients” – corporations, academics, entrepreneurs – via phone calls and mailed letters that they were at risk. “The NRC has been the target of a cyber intrusion. As a result the information held in our systems from your organization may have been compromised,” one form letter reads.

One version of this letter in the NRC files was accompanied by a spreadsheet of more than 20,000 Canadian firms, most of them apparently engaged in government-sponsored research.

“As a precautionary measure, NRC informed all clients and research partners involved in business relationships and research activities of the cyber intrusion,” spokesman Guillaume Bérubé said in reply to questions about this list.

Several of the companies that were contacted by The Globe said they felt that the fallout was minimal because they were careful, even before the hack, about sharing trade secrets with the agency. Their biggest gripe with the NRC was that correspondence and payments became frustratingly slow in 2014. “It wasn’t back to the buggy, but it was pretty close,” said one entrepreneur, who asked not to be named.

This was because staff at the scientific agency had been told not to use computers to communicate. E-mail “must not be used to transmit secure, sensitive or confidential information,” one memo read. “The preferred way of transferring confidential information … is paper (fax, mail, courier),” another said.

Clients were to be told that “if you must share sensitive information with the NRC, the best practice is to do it via physical media” – meaning on paper or via USB sticks.

As the hack was announced publicly, one enterprising NRC employee wrote that he found a stash of safe digital devices. “I’ve dug up a box of brand new McAfee USB keys that we bought a few years ago,” he told colleagues in an e-mail. Calling them “state of the art” for their encryption capability, he said they could serve as a “stopgap, at least until NRC gets in more for everyone.”

Even the act of plugging a smartphone into an NRC computer was deemed risky. “Instead of using your computer to charge your phone, charge it through a wall outlet,” one memo says.

The agency started to pull the plug on almost all of its existing computer architecture as it created the data equivalent of an airlock. The hope was to move electronic files from the NRC’s legacy “black” environment to a blank slate of new machines dubbed the “green” environment.

The in-between step was the “grey zone,” a locked-down “scrubbing” station with no external network connectivity and which banned unfamiliar digital devices and outsiders. “The process of scrubbing data to be taken out of the Grey Zone can take a long time. We have seen up to 40 minutes to scrub 1 GB [gigabyte] of data,” one employee complained.

The NRC’s initial hope was to have fully rebuilt systems within a year. Most are in now place, but the Canadian Press recently reported that some parts will not be ready until July 2018.

Early this summer, the NRC announced that it had embarked on a partnership with its scientific counterparts in a foreign country.

That country is China. This new joint venture with Guangdong province aims to better fund collaborative Canadian and Chinese research projects.

The NRC was asked by The Globe why it would want to do business with a country that allegedly stole from it just two years ago.

Mr. Bérubé said simply that “global collaboration is a competitive necessity to generate new business opportunities.” The NRC spokesman added in his e-mailed reply that “the government of Canada is committed to deepening our trade relationships with established and emerging markets, including China.”

Over the years, the NRC has engaged in several foreign partnerships, and has done business with China before.

But Peter Phillips, a University of Saskatchewan professor who specializes in agriculture and innovation, suggests that several motivations could be at play in the new partnership.

“There’s an old adage that if you can’t beat them, join them,” he quipped.

He added that 2014 will be remembered as a painful year at the NRC. “Everything was down to hard copy, paper, and fax machines at best,” he said. “And this is our largest research organization in the country.”

Source : http://www.theglobeandmail.com/news/national/records-show-extensive-fallout-from-chinese-hack-of-national-research-council/article31695327/

Categorized in Internet Technology

People have often referred to Google, Facebook and Twitter as cases where foreign tech companies are blocked in China. In reality, while Facebook and Twitter were indeed blocked, Google chose to withdraw because they didn’t want to comply with Chinese censorship regulations.

It’s important to note that most foreign tech companies were not blocked, and companies like eBay, Amazon, Viadeo and, of course, Apple and Samsung all entered and competed in China.

EBay was beaten by Alibaba more than a decade ago. Amazon entered China through the acquisition of a local company, Joyo, in 2004, but was never able to build a commanding position in China the way they did in the U.S. Viadeo withdrew in 2015 due to a lack of market traction mostly because of the entry of LinkedIn.

On the other hand, Apple and Samsung have done well in China, despite increasing competition from the Chinese who are chipping off pieces of their pies. More recently, Uber China and Didi Chuxing reached a mutually beneficial deal, though some see it as Uber essentially surrendering the China market to Didi Chuxing.

This all seems to beg the question: Can foreign tech companies win in China?

Clearly, China’s regulatory regime regarding the internet, in particular social media, is far more restrictive than that of the U.S. and many other western countries in general. The “Great Firewall” has proven itself repeatedly to be a thorn in the side of foreign companies, and not all have been able to overcome this hurdle. Most have tried, but with varying degrees of success.

It all comes down to the company’s mindset and willingness to adapt. Some firms decided they didn’t want to play in such a context, like Google, and withdrew their operations. Some want to play but got blocked, like Facebook, yet continue to lobby the government for access. Some were allowed to play but couldn’t quite get their act together (for whatever reason), like Amazon, Viadeo and perhaps even Airbnb. There was also Yihaodian, which was Walmart’s online business, but eventually Walmart sold it to JD.com in exchange for some of JD’s shares.

China is not easy. It’s tough for everyone, no matter if one is foreign or not.

But there are some who seem to “get it,” like LinkedIn (at least for now). They entered the China market in 2014 with a dedicated Chinese site, Lingying, and within two years grew their user base to 20 million subscribers and counting. How did they manage such a feat where several others failed? They adapted to the China context. Not only did they localize by conforming to restrictions on content, they partnered with local firms Sequoia China and China Broadband Capital to further understand the China market.

LinkedIn also created local leadership by hiring a president for LinkedIn China, giving the team more autonomy to integrate and cater to local needs. Examples include collaborating with Tencent’s WeChat so users could link profiles, launching a Chinese business social networking app “Chitu” and planning to release a Chinese version of its Pulse news reader app.

Another such example is Evernote. They, too, found success through a focus on meaningful localization. Not only did they hire locally, they employed localized marketing strategies by leveraging local social media like Weibo and WeChat, and had localized customer service, which supports real-time customer support on the mentioned platforms. They did thorough market research before entering in 2012, and looked to solve the “pain points” of the Chinese consumer, mainly security and privacy. Lastly, they had an easy-to-recall Chinese name (Yinxiang Biji) with a memorable pun. This strategy paid off; within the first year after launch they had 4 million users in China, and by 2015 their user base reached 17 million.

The notion that lower-quality clones sprung up because of foreign tech companies being blocked is only partially right. One could argue that the major Chinese social websites of Baidu, Ren Ren, Sina Weibo and Youku Toudu are clones of Google, Facebook, Twitter and YouTube, respectively. While the likes of Ren Ren weren’t able to replicate Facebook-like success in China, others have evolved beyond being clones to having their own unique, innovative ecosystems.

One such example is WeChat. Though it was originally inspired by Kik, and had similar features to WhatsApp, it evolved from mere messaging to becoming an integral part of the Chinese connected lifestyle. WeChat users can now link their bank cards to WeChat Pay, make in-store payments, transfer money to peers, buy movie tickets, hail taxis, pay for utility bills and so on. In fact, the list is practically endless, and shows how WeChat’s business model has become so powerful, and has grown from being a simple messaging app like WhatsApp (which, incidentally is also not blocked in China, but cannot hope to compete on WeChat’s scale).

Foreign tech players tend not to be as extensive in ecosystem building.

Importantly, Chinese innovators are developing new intellectual capital. They are crafting innovative business models and reaching new frontiers of business strategy and organization. Prime examples include Alibaba and LeEco. Jack Ma has built Alibaba into a sprawling internet business through “multiple jumping” from one business area to another, while building its capabilities along the way through a combination of self-built and collaborative partnerships. This disrupted the conventional “core competence” approach that has ruled modern business for the past 30-odd years.

LeEco is, broadly speaking, a “lifestyle” company, with a diverse ecosystem of infotainment content, smart devices and internet-connected mobility. Many commentators by now have pointed out that Chinese innovators are fast, agile and adaptive. However, these are merely phenomenological observations. At heart, the best and brightest of these innovators are deeply reflective on what the new frontiers of business are, focusing on “how can we get it right and do it well?”

Of course, China’s market for tech companies has evolved significantly for over a decade and a half. When Alibaba was competing with eBay more than a decade ago, China’s tech market was pretty primitive. Alibaba merely used guerrilla warfare tactics based on its grit to defeat a major foreign player. Today, both the market and the players are much more sophisticated and their business approaches are much more refined. The leading Chinese innovators are digital ecosystem players building scale and creating customer stickiness through their entire ecosystem. Foreign tech players tend not to be as extensive in ecosystem building.

To “win,” foreign tech companies need to adapt to the China context and deeply understand the key factors of success. Local leadership is critical and appropriate empowerment by the global headquarters to the local leadership to do the right things is essential. While for some, the market is not open or they are not welcome, for many, the opportunities are right there. China is not easy, but why should it be? It’s tough for everyone, no matter if one is foreign or not. And no one can be sustainably successful if they don’t observe, learn and adapt.

LinkedIn China’s Chitu, for instance, is struggling to get market traction. Evernote, while achieving early success in China, seems to be facing some challenges for sustainable growth, mainly due to lack of premium paid users and growing competition from Chinese startups. In fact, drawing a line on “who’s Chinese and who’s not” is also somewhat artificial, given that Alibaba’s and Tencent’s largest respective shareholders are not Chinese, and some of LinkedIn China’s and Uber China’s key shareholders are Chinese. (Sequoia China, whose parent is a Silicon Valley-headquartered VC fund, has its operations led by Chinese venture capitalist Neil Shen, who has a deep understanding of the China context.)

As China’s digital business grows, it’s going to provide more opportunities for many players. Who “gets it” and who doesn’t will certainly not only be a function of “being blocked or not,” but equally (or even more importantly) those who have the right mindset and approach to the China context (and for that matter, China for the world). To this end, it’s a real test of the leadership and capabilities of the companies, as well as the capital behind them.

Source : https://techcrunch.com/2016/08/28/can-foreign-tech-companies-win-in-china/

Categorized in Others

China's search engine giants Baidu and Sogou, have been investigated by Shanghai authorities under suspicion for illegal commercial promotions.


This comes after the implementation of China's new Internet advertising regulations, which for the first time ever have defined paid-for search results on search engines as advertisements.

Baidu and Sogou are being investigated for promoting unqualified hospitals. The hospitals involved in the case, are also under investigation.

Baidu, the biggest Internet search engine in China, has been in hot water since April this year, as its search results influenced a 22-year-old college student's choice of medical treatment leading to his death

In July, Baidu was caught up in another scandal for its late-night promotion of gambling sites

These incidents have created a stir across China, and accelerated amendments of China's Internet advertising regulations and laws.

The newly-amended Internet advertising regulations of China came into effect on September 1rst, 2016.

 

Source : http://english.cri.cn/12394/2016/09/03/4201s939253.htm

Categorized in Search Engine

Chinese search engine Baidu, which opened its India office in Delhi last year, wants to expand its services in India through an ad platform and a localised marketplace.


Josh Fenn of Baidu Inc’s Global Business Unit speaks to BrandWagon’s Ankita Rai on the company’s India strategy, its focus on app developers and building a digital ecosystem.


Baidu has so far launched only niche utility applications in India, while in other markets it is also present in online to offline (O2O) and search spaces. What is the India strategy?


In India, the focus is on mobile and mobile-related products because there is a global shift towards mobile. It was in 2008 that we started bringing our products outside China. India is our newest market.


Between 2008 and 2013, we launched some of our popular products here such as DU Battery Saver, DU Speed Booster, Baidu Browser, MoboMarket, ES File Explorer and input app Simeji.


The marketplace MoboMarket was first launched in Indonesia and shortly afterwards in India. MoboMarket has 4.5 million active monthly users each in India and Indonesia. In India, MoboMarket is available in Hindi, Tamil, Marathi, Bangla, Marathi and Urdu, with Telugu launching soon. Developers can launch their apps on this platform and get more eyeballs in the domestic market and monetise through our DU Ad Platform. There are eight million monthly active users for DU Battery Saver and Du Speed Booster in India, while ES File Explorer has 10 million monthly active users.


In India, we are focussed on building a strong foundation of internet services that will help to build the ecosystem.


The first phase of the India strategy was launched in 2013-2014 aimed at building a user base for our products here.
The second phase was to introduce more developer facing platforms and grow the ecosystem. That’s where MoboMarket comes into play. The marketplace aims to enable local developers find the right audience for their apps and get more downloads. The third phase is aimed at enabling developers make more money out of it. That’s where the DU Ad Platform comes into play.


As Baidu looks to capitalise on opportunities outside China, what kind of markets are you targeting?
If you look at all the countries that we have offices in apart from the US — Brazil, Egypt, India, Thailand, Indonesia and Japan — Japan stands out, being the most developed market. The rest are emerging countries and have similar characteristics such as lower smartphone and internet penetration, but are fast growing. We
observed a similar trend in China a few years ago.


Now China has 52 per cent internet penetration. It has over 700 million internet subscribers across PC and mobile. So yes, we are looking for countries similar to China that are in the early phases of mobile internet. Second, we have a localised strategy for each market instead of rolling out generic products.


We have been operating in China for 16 years. We have developed unique ways to bridge the technology gap. For example, we have made our search more humanised and help people who don’t know how to interact with technology.


For instance in hinterlands, people write long queries when searching something online. We understand how to bridge this gap between rural and urban population and we are planning to bring this expertise in India and other countries too.
A majority of Baidu’s revenues comes from search advertising. But the whole idea of search is changing. Users can now get news, weather updates or even search for flights on platforms like Facebook or even in the Chinese context, on WeChat. Is the market for search saturating with competition coming from non-traditional players?


The search market has evolved quite a bit since 2014. There are different entry ways for people to find information they are looking for, such as Facebook, WeChat, e-commerce portals or through O2O services. In China, we have a very strong position in search due to integration of machine learning technology.


In mobile search, our market share is over 75 per cent. We have 660 million monthly active users on our mobile search platform in China. The search market is not narrowing down but our focus is building foundational services for the internet ecosystem here in India.


Baidu launched a search engine in Brazil in 2014. As you expand globally, do you plan to launch search in other countries? Given Baidu’s experience in the O2O business model in China, do you plan to replicate similar offerings in other markets?
Baidu is present in information, search, app platforms, AI and machine learning technologies. We previously launched search in Brazil, Thailand, Egypt and Japan. But we are now more focussed on mobile products and services. Search is just one way of looking at things. We are integrating machine learning in O2O services. We are diversifying into other entry ways of search.


For example, you can integrate machine learning into group buying platforms. We have 1.6 billion users outside China. In terms of user numbers, the biggest markets are Indonesia, India and the US. In 2014, we acquired Brazil’s biggest deal platform, Peixe Urbano. The company has 70 per cent of the domestic market share. We take a localised approach in each market. In India, we don’t have any plans right now in the O2O space, but it is a possibility.


Baidu launched its ad platform for advertisers and publishers in India this year. How will it help small app developers?
In case of an app ecosystem, it is important to support the small developers. This is what we learnt in China and aim to implement it in other countries such as India.

 

The DU Ad Platform, launched in March, helps small app developers in monetisation. It provides advertisers with intelligent targeted ads and publishers with efficient monetisation solutions. We have 1.6 billion users for all of our apps outside China.

 

Source : http://www.financialexpress.com/industry/companies/face-off-baidu-takes-a-localised-approach-in-each-market-says-baidus-josh-fenn/348219/ 

Categorized in Search Engine

Microsoft announced last week that the default search engine on Microsoft Edge browser in Windows 10 will be Baidu, not Bing.

The announcement read:

Together, we will make it easy for Baidu customers to upgrade to Windows 10 and we will deliver a custom experience for customers in China, providing local browsing and search experiences. Baidu.com will become the default homepage and search for the Microsoft Edge browser in Windows 10. Baidu’s new Windows 10 distribution channel, Baidu “Windows 10 Express” will make it easy for Chinese Internet users to download an official Windows 10 experience. Additionally, Baidu will deliver Universal Windows Applications for Search, Video, Cloud and Maps for Windows 10.

We remain deeply committed to delivering Bing around the world and we’re also committed to offering locally relevant experiences - like Baidu in China - to provide great Windows 10 experiences.

This is a pretty big deal for Microsoft and honestly makes a statement.

The obvious point, as engine said in WebmasterWorld, "there's an interesting fact there that is worth highlighting - Microsoft drops Bing as default search for Baidu in China."

Source : https://www.seroundtable.com/baidu-default-edge-browser-20952.html 

Categorized in Search Engine
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