Industrial espionage
Industrial espionage, economic espionage or corporate espionage is a form of espionage
Espionage or spying involves an individual obtaining information that is considered secret or confidential without the permission of the holder of the information. Espionage is inherently clandestine, lest the legitimate holder of the information change plans or take other countermeasures once it...

 conducted for commercial
While business refers to the value-creating activities of an organization for profit, commerce means the whole system of an economy that constitutes an environment for business. The system includes legal, economic, political, social, cultural, and technological systems that are in operation in any...

 purposes instead of purely national security
National security
National security is the requirement to maintain the survival of the state through the use of economic, diplomacy, power projection and political power. The concept developed mostly in the United States of America after World War II...

 purposes. Economic espionage is conducted or orchestrated by governments and is international in scope, while industrial or corporate espionage is more often national and occurs between companies or corporations.

Competitive intelligence and economic or industrial espionage

'Competitive intelligence
Competitive intelligence
A broad definition of competitive intelligence is the action of defining, gathering, analyzing, and distributing intelligence about products, customers, competitors and any aspect of the environment needed to support executives and managers in making strategic decisions for an organization.Key...

' describes the legal and ethical activity of systematically gathering, analyzing and managing information on industrial competitors. It may include activities such as examining newspaper articles, corporate publications, websites, patent filings, specialised databases, information at trade shows and the like to determine information on a corporation. The compilation of these crucial elements is sometimes termed CIS or CRS, a Competitive Intelligence Solution or Competitive Response Solution. With its roots in market research
Market research
Market research is any organized effort to gather information about markets or customers. It is a very important component of business strategy...

, 'competitive intelligence' has been described as the 'application of principles and practices from military and national intelligence to the domain of global business'; it is the business equivalent of open-source intelligence.

In theory, the difference between 'competitive intelligence' and economic or industrial espionage is clear. In practice, it is sometimes quite difficult to tell the difference between legal and illegal methods. Especially if one starts to consider the ethical side of information gathering, the border becomes even more blurred and elusive of definition.

Forms of economic and industrial espionage

Economic or industrial espionage takes place in two main forms. In short, the purpose of espionage is to gather knowledge about (an) organization(s). It may include the acquisition of intellectual property
Intellectual property
Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...

, such as information on industrial manufacture, ideas, techniques and processes, recipes and formulas. Or it could include sequestration of proprietary or operational information, such as that on customer datasets, pricing, sales, marketing, research and development, policies, prospective bids, planning or marketing strategies or the changing compositions and locations of production. It may describe activities such as theft of trade secrets, bribery
Bribery, a form of corruption, is an act implying money or gift giving that alters the behavior of the recipient. Bribery constitutes a crime and is defined by Black's Law Dictionary as the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official or...

, blackmail
In common usage, blackmail is a crime involving threats to reveal substantially true or false information about a person to the public, a family member, or associates unless a demand is met. It may be defined as coercion involving threats of physical harm, threat of criminal prosecution, or threats...

 and technological surveillance. As well as orchestrating espionage on commercial organizations, governments can also be targets —for example, to determine the terms of a tender for a government contract so that another tenderer can underbid.

Target industries

Economic and industrial espionage is most commonly associated with technology-heavy industries, including computer software and hardware, biotechnology
Biotechnology is a field of applied biology that involves the use of living organisms and bioprocesses in engineering, technology, medicine and other fields requiring bioproducts. Biotechnology also utilizes these products for manufacturing purpose...

, aerospace
Aerospace comprises the atmosphere of Earth and surrounding space. Typically the term is used to refer to the industry that researches, designs, manufactures, operates, and maintains vehicles moving through air and space...

, telecommunications, transportation and engine technology, automobiles, machine tools, energy
Electrical power industry
The electric power industry provides the production and delivery of electric energy, often known as power, or electricity, in sufficient quantities to areas that need electricity through a grid connection. The grid distributes electrical energy to customers...

, materials
Materiel is a term used in English to refer to the equipment and supplies in military and commercial supply chain management....

 and coatings and so on. Silicon Valley
Silicon Valley
Silicon Valley is a term which refers to the southern part of the San Francisco Bay Area in Northern California in the United States. The region is home to many of the world's largest technology corporations...

 is known to be one of the world's most targeted areas for espionage, though any industry with information of use to competitors may be a target.

Information theft and sabotage

Information can make the difference between success and failure; if a trade secret
Trade secret
A trade secret is a formula, practice, process, design, instrument, pattern, or compilation of information which is not generally known or reasonably ascertainable, by which a business can obtain an economic advantage over competitors or customers...

 is stolen, the competitive playing field is leveled or even tipped in favor of a competitor.
Although a lot of information-gathering is accomplished legally through competitive intelligence, at times corporations feel the best way to get information is to take it. Economic or industrial espionage is a threat to any business whose livelihood depends on information.

In recent years, economic or industrial espionage has taken on an expanded definition. For instance, attempts to sabotage a corporation may be considered industrial espionage; in this sense, the term takes on the wider connotations of its parent word. That espionage and sabotage
Sabotage is a deliberate action aimed at weakening another entity through subversion, obstruction, disruption, or destruction. In a workplace setting, sabotage is the conscious withdrawal of efficiency generally directed at causing some change in workplace conditions. One who engages in sabotage is...

 (corporate or otherwise) have become more clearly associated with each other is also demonstrated by a number of profiling studies, some government, some corporate. The US Government currently has a polygraph examination entitled the "Test of Espionage and Sabotage" (TES, contributing to the increasingly popular, though not consensus, notion, by those studying espionage and sabotage countermeasures, of the interrelationship between the two. In practice, particularly by 'trusted insiders,' they are generally considered functionally identical for the purpose of informing countermeasures.

Agents and the process of collection

Economic or industrial espionage commonly occurs in one of two ways. Firstly, a dissatisfied employee appropriates information to advance their own interests or to damage the company or, secondly, a competitor or foreign government seeks information to advance its own technological or financial interest 'Moles
Mole (espionage)
A mole is a spy who works for an enemy nation, but whose loyalty ostensibly lies with his own nation's government. In some usage, a mole differs from a defector in that a mole is a spy before gaining access to classified information, while a defector becomes a spy only after gaining access...

' or trusted insiders are generally considered the best sources for economic or industrial espionage. Historically known as a 'patsy,' an insider can be induced, willingly or under duress to provide information. A 'Patsy' may be initially asked to hand over inconsequential information and once compromised by committing a crime, bribed into handing over material which is more sensitive. Individuals may leave one company to take up employment with another and take sensitive information with them. Such apparent behavior has been the focus of numerous industrial espionage cases that have resulted in legal battles. Some countries hire individuals to do spying rather than make use of their own intelligence agencies. Academics, business delegates and students are often thought to be utilized by governments in gathering information. Some countries, such as Japan, have been reported to expect students be debriefed on returning home. A spy may follow a guided tour of a factory then get 'lost'. A spy could be an engineer, a maintenance man, a cleaner, a insurance salesman or an inspector - basically anyone who has legitimate access to the premises.

A spy may break into the premises to steal data. They may search through waste paper and refuse, known as "dumpster diving". Information may be compromised via unsolicited requests for information, marketing surveys or use of technical support, research or software facilities. Outsourced industrial producers may ask for information outside of the agreed-upon contract.

Computers have facilitated the process of collecting information, due to the ease of access to large amounts of information, through physical contact or via the internet.

Personal computers

Computers have become key in exercising industrial espionage due to the enormous amount of information they contain and its ease of being copied and transmitted. The use of computers for espionage increased rapidly in the 1990s. Information has been commonly stolen by being copied from unattended computers in offices, those gaining unsupervised access doing so through subsidiary jobs, such as cleaners or repairmen. Laptop
A laptop, also called a notebook, is a personal computer for mobile use. A laptop integrates most of the typical components of a desktop computer, including a display, a keyboard, a pointing device and speakers into a single unit...

s were, and still are, a prime target, with those traveling abroad on business being warned not to leave them for any period of time. Perpetrators of espionage have been known to find many ways of conning unsuspecting individuals into parting, often only temporarily, from their possessions, enabling others to access and steal information. A 'bag-op' refers to the use of hotel staff to access data, such as through laptops, in hotel rooms. Information may be stolen in transit, in taxi
A taxicab, also taxi or cab, is a type of vehicle for hire with a driver, used by a single passenger or small group of passengers, often for a non-shared ride. A taxicab conveys passengers between locations of their choice...

s, at airport baggage counters, baggage carousel
Baggage carousel
A baggage carousel is a device, generally at an airport, that delivers checked luggage to the passengers at the baggage claim area at their final destination. Not all airports use these devices...

s, on train
A train is a connected series of vehicles for rail transport that move along a track to transport cargo or passengers from one place to another place. The track usually consists of two rails, but might also be a monorail or maglev guideway.Propulsion for the train is provided by a separate...

s and so on.

The Internet

The rise of the internet and computer networks has expanded the range and detail of information available and the ease of access for the purpose of industrial espionage. Worldwide, around 50,000 companies a day are thought to come under cyberattack with the rate estimated as doubling each year. This type of operation is generally identified as state backed or sponsored, because the 'access to personal, financial or analytic resources' identified exceed that which could be accessed by cybercriminals or individual hackers. Sensitive military or defense engineering or other industrial information may not have immediate monetary value to criminals, compared with, say, bank details. Analysis of cyberattacks suggests deep knowledge of networks, with targeted attacks, obtained by numerous individuals operating in a sustained organized way.

Opportunities for sabotage

The rising use of the internet has also extended opportunities for industrial espionage with the aim of sabotage. In the early 2000s, it was noticed that energy companies were increasingly coming under attack from hackers. Energy power systems, doing jobs like monitoring power grids or water flow, once isolated from the other computer networks, were now being connected to the internet, leaving them more vulnerable, having historically few built-in security features. The use of these methods of industrial espionage have increasingly became a concern for governments, due to potential attacks by terrorist groups or hostile foreign governments.


One of the means of perpetrators conducting industrial espionage is by exploiting vulnerabilities in computer software. Malware
Malware, short for malicious software, consists of programming that is designed to disrupt or deny operation, gather information that leads to loss of privacy or exploitation, or gain unauthorized access to system resources, or that otherwise exhibits abusive behavior...

 and spyware
Spyware is a type of malware that can be installed on computers, and which collects small pieces of information about users without their knowledge. The presence of spyware is typically hidden from the user, and can be difficult to detect. Typically, spyware is secretly installed on the user's...

 as 'a tool for industrial espionage,' in 'transmitting digital copies of trade secrets, customer plans, future plans and contacts'. Newer forms of malware include devices which surreptitiously switch on mobile phones camera and recording devices. In attempts to tackle such attacks on their intellectual property, companies are increasingly keeping important information off network, leaving an 'air gap,' with some companies building '"Faraday cages"' to shield from electromagnetic or cellphone transmissions.

Distributed denial of service (DDoS) attack

The distributed denial of service (DDoS) attack uses compromised computer systems to orchestrate a flood of requests on the target system, causing it to shut down and deny service to other users. It could potentially be used for economic or industrial espionage with the purpose of sabotage. This method was allegedly utilized by Russian secret services, over a period of two weeks on a cyberattack on Estonia in May 2007, in response to the removal of a Soviet era war memorial..

Origins of industrial espionage

Economic and industrial espionage has a long history. The work of Father Francois Xavier d'Entrecolles
Francois Xavier d'Entrecolles
Francois Xavier d'Entrecolles was a French Jesuit priest, who discovered the Chinese technique of manufacturing "true" or hard-paste porcelain through his investigations in China at Jingdezhen with the help of Chinese Catholic converts between 1712 and 1722, during the rule of the Kangxi...

 in Jingdezhen, China
Jingdezhen , is a prefecture-level city, previously a town, in Jiangxi Province, China, with a total population of 1,554,000 . It is known as the "Porcelain Capital" because it has been producing quality pottery for 1700 years. The city has a well-documented history that stretches back over 2000...

 to reveal to Europe the manufacturing methods of Chinese porcelain
Chinese porcelain
Chinese ceramic ware shows a continuous development since the pre-dynastic periods, and is one of the most significant forms of Chinese art. China is richly endowed with the raw materials needed for making ceramics. The first types of ceramics were made during the Palaeolithic era...

 in 1712 is sometimes considered an early case of industrial espionage.

Historical accounts have been written of industrial espionage between Britain
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

 and France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...

. Attributed to Britain's emergence as an 'industrial creditor,' the second decade of the 18th century saw the emergence of a large-scale state-sponsored effort to surreptitiously take British industrial technology to France. Witnesses confirmed both the inveigling of tradespersons abroad and the placing of apprentices in England. Protests by those such as iron workers in Sheffield
Sheffield is a city and metropolitan borough of South Yorkshire, England. Its name derives from the River Sheaf, which runs through the city. Historically a part of the West Riding of Yorkshire, and with some of its southern suburbs annexed from Derbyshire, the city has grown from its largely...

 and steel workers in Newcastle
Newcastle upon Tyne
Newcastle upon Tyne is a city and metropolitan borough of Tyne and Wear, in North East England. Historically a part of Northumberland, it is situated on the north bank of the River Tyne...

, about skilled industrial workers being enticed abroad, led to the first English legislation aimed at preventing this method of economic and industrial espionage.

During the Cold War

With Western restrictions on the export of items thought likely to increase military capabilities to the USSR, Soviet
Soviet Union
The Soviet Union , officially the Union of Soviet Socialist Republics , was a constitutionally socialist state that existed in Eurasia between 1922 and 1991....

 industrial espionage was a well known adjunct to other spying activities up until the 1980s.

"Operation Brunnhilde"

Some of these activities were directed via the East German Stasi
The Ministry for State Security The Ministry for State Security The Ministry for State Security (German: Ministerium für Staatssicherheit (MfS), commonly known as the Stasi (abbreviation , literally State Security), was the official state security service of East Germany. The MfS was headquartered...

 (Ministry for State Security). One such operation, known as "Operation Brunnhilde" operated from the mid-1950s until early 1966 and made use of spies from many Communist Bloc countries. Through at least 20 forays, many western European industrial secrets were compromised. One member of the "Brunnhilde" ring was a Swiss chemical engineer
Chemical engineer
In the field of engineering, a chemical engineer is the profession in which one works principally in the chemical industry to convert basic raw materials into a variety of products, and deals with the design and operation of plants and equipment to perform such work...

 called Dr Jean Paul Soupert, also known as 'Air Bubble,' living in Brussels
Brussels , officially the Brussels Region or Brussels-Capital Region , is the capital of Belgium and the de facto capital of the European Union...

. He was described by Peter Wright
Peter Wright
Peter Maurice Wright was an English scientist and former MI5 counterintelligence officer, noted for writing the controversial book Spycatcher, which became an international bestseller with sales of over two million copies...

 in Spycatcher
Spycatcher: The Candid Autobiography of a Senior Intelligence Officer , is a book written by Peter Wright, former MI5 officer and Assistant Director, and co-author Paul Greengrass. It was published first in Australia...

 as having been 'doubled' by the Belgian
Belgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...

 Sûreté de l'État
Belgian State Security Service
The Belgian State Security Service, known in Dutch as Veiligheid van de Staat, or Staatsveiligheid , and in French as Sûreté de l'État , is a Belgian intelligence agency...

. He revealed information about industrial espionage conducted by the ring, including the fact that Russian agents had obtained details of Concorde
Aérospatiale-BAC Concorde was a turbojet-powered supersonic passenger airliner, a supersonic transport . It was a product of an Anglo-French government treaty, combining the manufacturing efforts of Aérospatiale and the British Aircraft Corporation...

's advanced electronics system. He testified against two Kodak employees, living and working in Britain, during a trial in which they were accused of passing information on industrial processes to him, though they were eventually acquitted.

Soviet spetsinformatsiya system

A secret report from the Military Industrial Commission (VPK), from 1979–80, detailed how spetsinformatsiya could be utilised in twelve different military industrial areas. Writing in the Bulletin of the Atomic Scientists
Bulletin of the Atomic Scientists
The Bulletin of the Atomic Scientists is a nontechnical online magazine that covers global security and public policy issues, especially related to the dangers posed by nuclear and other weapons of mass destruction...

, Philip Hanson detailed a spetsinformatsiya system in which 12 industrial branch ministries formulated requests for information to aid technological development in their military programs. Acquisition plans were described as operating on 2 year and 5 year cycles with about 3000 tasks under way each year. Efforts were aimed at civilian as well as military industrial targets, such as in the petrochemical industries. Some information was garnered so as to compare levels of competitor to Soviet technological advancement. Much unclassified information was also gathered, blurring the boundary with 'competitive intelligence'.

The Soviet military was recognised as making much better use of acquired information, compared to civilian industry, where their record in replicating and developing industrial technology was poor.

The legacy of Cold War espionage

Following the demise of the Soviet Union and the end of the 'Cold War
Cold War
The Cold War was the continuing state from roughly 1946 to 1991 of political conflict, military tension, proxy wars, and economic competition between the Communist World—primarily the Soviet Union and its satellite states and allies—and the powers of the Western world, primarily the United States...

,' commentators, including the US Congressional
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....

 Intelligence Committee, noted a redirection amongst the espionage community from military to industrial targets, with Western and former communist countries making use of 'underemployed' spies and expanding programs directed at stealing such information.

The legacy of 'Cold War' spying included not just the redirection of personnel but the use of spying apparatus such as computer databases, scanners for eavesdropping
Covert listening device
A covert listening device, more commonly known as a bug or a wire, is usually a combination of a miniature radio transmitter with a microphone. The use of bugs, called bugging, is a common technique in surveillance, espionage and in police investigations.A bug does not have to be a device...

, spy satellites, bugs
Covert listening device
A covert listening device, more commonly known as a bug or a wire, is usually a combination of a miniature radio transmitter with a microphone. The use of bugs, called bugging, is a common technique in surveillance, espionage and in police investigations.A bug does not have to be a device...

 and wires
Covert listening device
A covert listening device, more commonly known as a bug or a wire, is usually a combination of a miniature radio transmitter with a microphone. The use of bugs, called bugging, is a common technique in surveillance, espionage and in police investigations.A bug does not have to be a device...


France and the United States

In 1991 Air France
Air France
Air France , stylised as AIRFRANCE, is the French flag carrier headquartered in Tremblay-en-France, , and is one of the world's largest airlines. It is a subsidiary of the Air France-KLM Group and a founding member of the SkyTeam global airline alliance...

 was accused of helping its spy agency garner corporate secrets through installing microphones in its seats. Between 1987 and 1989, IBM
International Business Machines Corporation or IBM is an American multinational technology and consulting corporation headquartered in Armonk, New York, United States. IBM manufactures and sells computer hardware and software, and it offers infrastructure, hosting and consulting services in areas...

 and Texas Instruments
Texas Instruments
Texas Instruments Inc. , widely known as TI, is an American company based in Dallas, Texas, United States, which develops and commercializes semiconductor and computer technology...

 were also thought to have been targeted by French spies with the intention of helping France's Groupe Bull
Groupe Bull
-External links:* * — Friends, co-workers and former employees of Bull and Honeywell* *...

. In 1993, US aerospace companies were also thought to have been targeted by French interests. During the early 1990s, France was described as one of the most aggressive pursuers of espionage to garner foreign industrial and technological secrets. France accused the U.S. of attempting to sabotage its high tech industrial base. The government of France has been alleged to have conducted ongoing industrial espionage against American aerodynamics and satellite companies.


In 1993, car manufacturer Opel
Adam Opel AG, generally shortened to Opel, is a German automobile company founded by Adam Opel in 1862. Opel has been building automobiles since 1899, and became an Aktiengesellschaft in 1929...

, the German division of General Motors
General Motors
General Motors Company , commonly known as GM, formerly incorporated as General Motors Corporation, is an American multinational automotive corporation headquartered in Detroit, Michigan and the world's second-largest automaker in 2010...

, accused Volkswagen
Volkswagen is a German automobile manufacturer and is the original and biggest-selling marque of the Volkswagen Group, which now also owns the Audi, Bentley, Bugatti, Lamborghini, SEAT, and Škoda marques and the truck manufacturer Scania.Volkswagen means "people's car" in German, where it is...

 of industrial espionage after Opel's chief of production, Jose Ignacio Lopez, and seven other executives moved to Volkswagen. Volkswagen subsequently threatened to sue for defamation, resulting in a four-year legal battle. The case, which was finally settled in 1997, resulted in one of the largest settlements in the history of industrial espionage, with Volkswagen agreeing to pay General Motors $100 million and to buy at least $1 billion of car parts from the company over 7 years, although it did not explicitly apologize for Lopez's behavior.

Hilton and Starwood

In April 2009 the US based hospitality company Starwood
Starwood may refer to:* Starwood Hotels & Resorts Worldwide* Starwood Amphitheatre* Starwood Club of Los Angeles, California* Starwood Festival...

 accused its rival Hilton
Hilton Hotels
Hilton Hotels & Resorts is an international chain of full-service hotels and resorts founded by Conrad Hilton and now owned by Hilton Worldwide. Hilton hotels are either owned by, managed by, or franchised to independent operators by Hilton Worldwide. Hilton Hotels became the first coast-to-coast...

 of a "massive" case of industrial espionage. After being purchased by private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....

 group Blackstone
Blackstone Group
The Blackstone Group L.P. is an American-based alternative asset management and financial services company that specializes in private equity, real estate, and credit and marketable alternative investment strategies, as well as financial advisory services, such as mergers and acquisitions ,...

, Hilton employed 10 managers and executives from Starwood. Under intense pressure to improve profits, Starwood accused Hilton of stealing corporate information relating to its luxury brand concepts, used in setting up its own Denizen hotels. Specifically, former head of its luxury brands group, Ron Klein, was accused of downloading "truckloads of documents" from a laptop to his personal email account.


GhostNet is the name given by researchers at the Information Warfare Monitor to a large-scale cyber spying operation discovered in March 2009. The operation is likely associated with an Advanced Persistent Threat...

 was a 'vast surveillance system' reported by Canadian researchers based at the University of Toronto
University of Toronto
The University of Toronto is a public research university in Toronto, Ontario, Canada, situated on the grounds that surround Queen's Park. It was founded by royal charter in 1827 as King's College, the first institution of higher learning in Upper Canada...

 in March 2009. Using targeted emails it compromised thousands of computers in governmental organisations, enabling attackers to scan for information and transfer this back to a 'digital storage facility in China'.

Google and Operation Aurora

On January 13, 2010, Google Inc. announced that operators, from within China, had hacked into their Google China operation, stealing intellectual property and, in particular, accessing the email accounts of human rights activists. The attack was thought to have been part of a more widespread cyber attack on companies within China which has become known as Operation Aurora
Operation Aurora
Operation Aurora was a cyber attack which began in mid-2009 and continued through December 2009. The attack was first publicly disclosed by Google on January 12, 2010, in a blog post. In the blog post, Google said the attack originated in China...

. Intruders were thought to have launched a zero-day attack, exploiting a weakness in the Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...

 Internet Explorer
Internet Explorer
Windows Internet Explorer is a series of graphical web browsers developed by Microsoft and included as part of the Microsoft Windows line of operating systems, starting in 1995. It was first released as part of the add-on package Plus! for Windows 95 that year...

 browser, the malware used being a modification of the trojan
Trojan horse (computing)
A Trojan horse, or Trojan, is software that appears to perform a desirable function for the user prior to run or install, but steals information or harms the system. The term is derived from the Trojan Horse story in Greek mythology.-Malware:A destructive program that masquerades as a benign...

 Hydraq. Concerned about the possibility of hackers taking advantage of this previously unknown weakness in Internet Explorer, the Government of Germany, then France, issued warnings not to use the browser.

There was speculation that 'insiders' had been involved in the attack, with some Google China employees being denied access to the company's internal networks after the company's announcement. In February 2010, computer experts from the U.S. National Security Agency
National Security Agency
The National Security Agency/Central Security Service is a cryptologic intelligence agency of the United States Department of Defense responsible for the collection and analysis of foreign communications and foreign signals intelligence, as well as protecting U.S...

 claimed that the attacks on Google probably originated from two Chinese universities associated with expertise in computer science, Shanghai Jiao Tong University
Shanghai Jiao Tong University
Shanghai Jiao Tong University or SJTU), sometimes referred to as Shanghai Jiaotong University , is a top public research university located in Shanghai, China. Shanghai Jiao Tong University is known as one of the oldest and most prestigious universities in China...

 and the Shandong Lanxiang Vocational School
Shandong Lanxiang Vocational School
The Shandong Lanxiang Vocational School is a vocational school in the Tianqiao District of Jinan, Shandong, China.The school was founded in 1984 and is said to have been established with support from the People's Liberation Army.The school admits about 20,000 students per year and offers courses...

, the latter having close links to the Chinese military
People's Liberation Army
The People's Liberation Army is the unified military organization of all land, sea, strategic missile and air forces of the People's Republic of China. The PLA was established on August 1, 1927 — celebrated annually as "PLA Day" — as the military arm of the Communist Party of China...


Google claimed at least 20 other companies had also been targeted in the cyber attack, said by the London Times
The Times
The Times is a British daily national newspaper, first published in London in 1785 under the title The Daily Universal Register . The Times and its sister paper The Sunday Times are published by Times Newspapers Limited, a subsidiary since 1981 of News International...

, to have been part of an 'ambitious and sophisticated attempt to steal secrets from unwitting corporate victims' including 'defence contractors, finance and technology companies'. Rather than being the work of individuals or organised criminals, the level of sophistication of the attack was thought to have been 'more typical of a nation state'. Some commentators speculated as to whether the attack was part of what is thought to be a concerted Chinese industrial espionage operation aimed at getting 'high-tech information to jump-start China’s economy'. Critics pointed to what was alleged to be a lax attitude to the intellectual property of foreign businesses in China, letting them operate but then seeking to copy or reverse engineer their technology for the benefit of Chinese 'national champions'. In Google's case, they may have (also) been concerned about the possible misappropriation of source code or other technology for the benefit of Chinese rival Baidu
Baidu, Inc. , simply known as Baidu and incorporated on January 18, 2000, is a Chinese web services company headquartered in the Baidu Campus in Haidian District, Beijing, People's Republic of China....

. In March 2010 Google subsequently decided to cease offering censored results in China, leading to the closing of its Chinese operation.

CyberSitter and 'Green Dam'

The US based firm CyberSitter announced in January 2010 that it was suing the Chinese government, and other US companies, for stealing its anti pornography software, with the accusation that it had been incorporated into China's Green Dam program, used by the state to censor Chinese citizens' internet access. CyberSitter accused Green Dam creators as having copied around 3000 lines of code. They were described as having done 'a sloppy job of copying,' with some lines of the copied code continuing to direct people to the CyberSitter website. The attorney
A lawyer, according to Black's Law Dictionary, is "a person learned in the law; as an attorney, counsel or solicitor; a person who is practicing law." Law is the system of rules of conduct established by the sovereign government of a society to correct wrongs, maintain the stability of political...

 acting for CyberSitter maintained “I don't think I have ever seen such clear-cut stealing".

USA v. Lan Lee, et al

The United States charged two former NetLogic Inc. engineers, Lan Lee and Yuefei Ge, of committing economic espionage against TSMC and NetLogic, Inc. A jury acquitted the defendants of the charges with regard to TSMC and deadlocked on the charges with regard to NetLogic. In May 2010, a federal judge dismissed all the espionage charges against the two defendants. The judge ruled that the U.S. Government presented no evidence of espionage.

Dongxiao Yue and 'Chordiant Software, Inc'

In May 2010, the federal jury convicted Chordiant Software, Inc., a U.S. corporation, of stealing Dr. Dongxiao Yue's JRPC technologies and used them in a product called 'Chordiant Marketing Director'. Dr. Yue previously filed lawsuits against Symantec corporation for a similar theft .

Stuxnet Worm

Stuxnet is a computer worm discovered in June 2010. It initially spreads via Microsoft Windows, and targets Siemens industrial software and equipment...

 is a computer worm
Computer worm
A computer worm is a self-replicating malware computer program, which uses a computer network to send copies of itself to other nodes and it may do so without any user intervention. This is due to security shortcomings on the target computer. Unlike a computer virus, it does not need to attach...

 which affected Iran's
Iran , officially the Islamic Republic of Iran , is a country in Southern and Western Asia. The name "Iran" has been in use natively since the Sassanian era and came into use internationally in 1935, before which the country was known to the Western world as Persia...

 Bushehr nuclear power plant
Bushehr Nuclear Power Plant
The Bushehr Nuclear Power Plant is a nuclear power plant in Iran southeast of the city of Bushehr, between the fishing villages of Halileh and Bandargeh along the Persian Gulf. The plant is located at the junction of three tectonic plates....

 in September 2010. Designed to target weaknesses in Siemens
Siemens may refer toSiemens, a German family name carried by generations of telecommunications industrialists, including:* Werner von Siemens , inventor, founder of Siemens AG...

 electronic industrial systems, it is thought to be capable of seizing control of industrial plants and to be the first 'worm' created for this purpose. The complexity of its design and targeted purpose left Western computer experts suggesting it could only have been the product of a "nation state". (Some security experts suggested Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...

; others suggest the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...

; still others suggest a combined effort of the two.) Mahmoud Liayi, from Iran's Ministry of Industries, is quoted as saying, "an electronic war has been launched against Iran". As well as targeting nuclear power stations, it is also capable of attacking systems which manage water supplies, oil rigs and other utilities.

According to the British
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

 Daily Telegraph
The Daily Telegraph
The Daily Telegraph is a daily morning broadsheet newspaper distributed throughout the United Kingdom and internationally. The newspaper was founded by Arthur B...

 a video played at the retirement party of the former Israel Defence Forces (IDF) chief of staff, Gabi Ashkenazi
Gabi Ashkenazi
Gavriel "Gabi" Ashkenazi , was the Chief of General Staff of the Israel Defence Forces from 2007 to 2011.- Background and early life :...

, claimed the worm as one of his "operational successes".

Operation Payback

Distributed Denial of Service (DDoS) attacks were utilised by a network of hackers
Hacker (computer security)
In computer security and everyday language, a hacker is someone who breaks into computers and computer networks. Hackers may be motivated by a multitude of reasons, including profit, protest, or because of the challenge...

, led by the self styled group 'Anonymous
Anonymous (group)
Anonymous is an international hacking group, spread through the Internet, initiating active civil disobedience, while attempting to maintain anonymity. Originating in 2003 on the imageboard 4chan, the term refers to the concept of many online community users simultaneously existing as an anarchic,...

', in orchestrating what was termed Operation Payback
Operation Payback
Operation Payback is a coordinated, decentralized group of attacks on opponents of Internet piracy by Internet activists using the "Anonymous" moniker - a group sometimes affiliated with the website 4chan. Operation Payback started as retaliation to distributed denial of service attacks on torrent...

, in December 2010. This was aimed at sabotaging the websites of corporations such as Mastercard
Mastercard Incorporated or MasterCard Worldwide is an American multinational financial services corporation with its headquarters in the MasterCard International Global Headquarters, Purchase, Harrison, New York, United States...

, Visa and Paypal
PayPal is an American-based global e-commerce business allowing payments and money transfers to be made through the Internet. Online money transfers serve as electronic alternatives to paying with traditional paper methods, such as checks and money orders....

, who had stopped Wikileaks
WikiLeaks is an international self-described not-for-profit organisation that publishes submissions of private, secret, and classified media from anonymous news sources, news leaks, and whistleblowers. Its website, launched in 2006 under The Sunshine Press organisation, claimed a database of more...

 donors using their financial services, allegedly under pressure from the United States Government. Thousands of people participating in the attacks did so through downloading the readily available open source
Open source
The term open source describes practices in production and development that promote access to the end product's source materials. Some consider open source a philosophy, others consider it a pragmatic methodology...

 LOIC (Low Orbit Ion Cannon) DDoS tool, leading to some commentators to note that, rather than worrying whether their credit card numbers had been hacked, parents should be concerned as to whether their teenage child was an amateur 'hackitivist'
Hacktivism is the use of computers and computer networks as a means of protest to promote political ends. The term was first coined in 1994 by a member of the Cult of the Dead Cow hacker collective named Omega...

, possibly 'participating in a co-ordinated global attack on major financial institutions'. With Wikileaks founder Julian Assange
Julian Assange
Julian Paul Assange is an Australian publisher, journalist, writer, computer programmer and Internet activist. He is the editor in chief of WikiLeaks, a whistleblower website and conduit for worldwide news leaks with the stated purpose of creating open governments.WikiLeaks has published material...

 in Wandsworth prison
Wandsworth (HM Prison)
HM Prison Wandsworth is a Category B men's prison at Wandsworth in the London Borough of Wandsworth, south west London, England. It is operated by Her Majesty's Prison Service and is the largest prison in London and one of the largest in western Europe, with similar capacity to Liverpool...

 on charges of sexual assault
Sexual assault
Sexual assault is an assault of a sexual nature on another person, or any sexual act committed without consent. Although sexual assaults most frequently are by a man on a woman, it may involve any combination of two or more men, women and children....

, the hackers threatened to bring down United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

 Government websites, should he be extradited
Extradition is the official process whereby one nation or state surrenders a suspected or convicted criminal to another nation or state. Between nation states, extradition is regulated by treaties...

 to face charges in Sweden
Sweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....

. However, 'Security experts' derided the idea that 'Operation Payback' was in any way comparable to cyber warfare, claiming attacks of this kind were very common, and relatively harmless, only reaching the news in this case due to the association with Wikileaks.

Chengdu J-20 stealth fighter jet

When it was unveiled in January 2010, the Chinese engineered Chengdu J-20
Chengdu J-20
The Chengdu J-20 is a purported fifth-generation, stealth, twin-engine fighter aircraft prototype developed by Chengdu Aircraft Industry Group for the Chinese People's Liberation Army Air Force . In late 2010, the J-20 underwent high speed taxiing tests. The J-20 made its first flight on 11...

 stealth fighter
Stealth Fighter
Stealth Fighter is an action film released in 1999. The film stars Ice-T, Costas Mandylor, Erika Eleniak, Sarah Dampf, William Sadler, Ernie Hudson, and Andrew Divoff.-Film synopsis:...

Jet aircraft
A jet aircraft is an aircraft propelled by jet engines. Jet aircraft generally fly much faster than propeller-powered aircraft and at higher altitudes – as high as . At these altitudes, jet engines achieve maximum efficiency over long distances. The engines in propeller-powered aircraft...

 was speculated by Balkan
The Balkans is a geopolitical and cultural region of southeastern Europe...

 military officials and other experts as having been reverse engineered from the parts of a US F-117 Nighthawk stealth fighter shot down over Serbia
Serbia , officially the Republic of Serbia , is a landlocked country located at the crossroads of Central and Southeast Europe, covering the southern part of the Carpathian basin and the central part of the Balkans...

 in 1999. It was the first time such an aircraft had been hit. When the US jet was shot down, Chinese officials in the country were reported as having travelled around the region buying up parts of the aircraft from farmers. Representing 'dramatic progress' into cutting edge military technology for the Chinese, the Chengdu J-20 stealth fighter was thought to potentially pose a challenge to US air superiority. President Milosevic was known to have routinely shared captured military technology with Russian and Chinese allies. The Russian Sukhoi T-50 prototype stealth fighter, unveiled in 2010, is likely to have been built from knowledge based on the same source .

Chinese commentators contested claims this technology had somehow been stolen. A test pilot claimed that the J-20 was a "masterpiece" of home-grown innovation and that the F-117 technology was "outdated" even at the time it was shot down; although it was reported that one of the wheels of the J-20 actually fell off the aircraft during a demonstration. This raises the question, is this aircraft really a masterpiece? An unnamed Chinese defence official protested to the official English language mouthpiece of the Chinese Communist Party, the Global Times
Global Times
The Global Times is a daily Chinese tabloid under the auspices of the official Chinese Communist Party newspaper, the People's Daily, focusing on international issues...

, "It's not the first time foreign media has smeared newly-unveiled Chinese military technologies. It's meaningless to respond to such speculations."

United States

A recent report to the US Government, by aerospace and defense company Northrop Grumman
Northrop Grumman
Northrop Grumman Corporation is an American global aerospace and defense technology company formed by the 1994 purchase of Grumman by Northrop. The company was the fourth-largest defense contractor in the world as of 2010, and the largest builder of naval vessels. Northrop Grumman employs over...

, describes Chinese economic espionage as comprising 'the single greatest threat to U.S. technology'. Joe Stewart, of SecureWorks
SecureWorks, Inc Headquartered in Atlanta, Georgia, SecureWorks, Inc. is a U.S.-based managed security services provider that provides information security services and protection of computer, network and information assets from malicious activity or cybercrime for its customers...

, blogging on the 2009 cyber attack on Google, referred to a 'persistent campaign of "espionage-by-malware" emanating from the People’s Republic of China (PRC)' with both corporate and state secrets being 'Shanghaied' over the past 5 or 6 years. The Northrup Grumann report states that the collection of US defense engineering data through cyberattack is regarded as having 'saved the recipient of the information years of R&D and significant amounts of funding'. Concerns about the extent of cyberattacks on the US emanating from China has led to the situation being described as the dawn of a 'new cold cyberwar'.

United Kingdom

In December 2007 it was revealed that Jonathan Evans, head of the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

's MI5
The Security Service, commonly known as MI5 , is the United Kingdom's internal counter-intelligence and security agency and is part of its core intelligence machinery alongside the Secret Intelligence Service focused on foreign threats, Government Communications Headquarters and the Defence...

 had sent out confidential letters to 300 chief executives and security chiefs at the country's banks, accountants and legal firms warning of attacks from Chinese 'state organisations'. A summary was also posted on the secure website of the Centre for the Protection of the National Infrastructure, accessed by some of the nation's 'critical infrastructure' companies, including 'telecoms firms, banks and water and electricity companies'. One security expert warned about the use of 'custom trojans
Trojan horse (computing)
A Trojan horse, or Trojan, is software that appears to perform a desirable function for the user prior to run or install, but steals information or harms the system. The term is derived from the Trojan Horse story in Greek mythology.-Malware:A destructive program that masquerades as a benign...

,' software specifically designed to hack into a particular firm and feed back data. Whilst China was identified as the country most active in the use of internet spying, up to 120 other countries were said to be using similar techniques. The Chinese government responded to UK accusations of economic espionage by saying that the report of such activities was 'slanderous' and that the government opposed hacking which is prohibited by law.


German counter-intelligence experts have maintained the German economy is losing around €53 billion or the equivalent of 30'000 jobs to economic espionage yearly. The main perpetrator was thought to be China, though Russia was also considered "top of the list," with a variety of espionage methods being used, from old fashioned spying, phone tapping and stealing laptops, to internet based methods, such as the use of Trojan email attacks. The target of these attacks included not just information about technology but also management techniques and marketing strategies. As well as accessing intellectual property on-line, state sponsored hackers were also considered, by German counter intelligence officer Walter Opfermann, as capable of "sabotaging huge chunks" of infrastructure such as Germany's power grid.

See also

  • Business intelligence
    Business intelligence
    Business intelligence mainly refers to computer-based techniques used in identifying, extracting, and analyzing business data, such as sales revenue by products and/or departments, or by associated costs and incomes....

  • Competitive intelligence
    Competitive intelligence
    A broad definition of competitive intelligence is the action of defining, gathering, analyzing, and distributing intelligence about products, customers, competitors and any aspect of the environment needed to support executives and managers in making strategic decisions for an organization.Key...

  • Cyber spying
    Cyber spying
    Cyber spying or Cyber espionage is the act or practice of obtaining secrets without the permission of the holder of the information , from individuals, competitors, rivals, groups, governments and enemies for personal, economic, political or military advantage using illegal exploitation methods on...

  • The American Economic Espionage Act of 1996
    Economic Espionage Act of 1996
    The Economic Espionage Act of 1996 was a 6 title Act of Congress dealing with a wide range of issues, including not only industrial espionage , but the insanity defense, the Boys & Girls Clubs of America, requirements for presentence investigation reports, and the United...

  • Trade secret
    Trade secret
    A trade secret is a formula, practice, process, design, instrument, pattern, or compilation of information which is not generally known or reasonably ascertainable, by which a business can obtain an economic advantage over competitors or customers...

External links

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