The Return of Fu Manchu - Chapter 1.5: Hackers and Spies

In a previous post, I pointed out how much hysteria and inaccurate reporting surrounds reports of Chinese spies (human, not digital). That continues unabated as well, and seems a close sibling of Heinous Hacker journalism. Consider FBI Goes On Offensive Against China's Tech Spies from USA Today, where the two examples actually involve an American (non-Chinese descent) stealing secrets to sell to a Chinese company, and another (with a Chinese sounding surname) stealing them while leaving for a UK firm. While the headline screams of Chinese spies, the articles information lends it far more to a general piece on how the Information Age lends itself easily to corporate espionage from people of any nationality or persuasion. It does, curiously, refer to an FBI statistic of 3,000 Chinese "technology brokers" operating in the U.S., some of whom are "front companies. Sounds like the infamous "3,000 front company" fake number has nine lives. It is heartening to know, however, that FBI agents are reading The World Is Flat.

Or there's Chinese Seek to Buy a U.S. Maker of Disk Drives in the New York Times. Like the Heinous Hackers, this quotes an anonymous insider:

“Seagate would be extremely sensitive,” said an industry executive who participates in classified government advisory groups. “I do not think anyone in the U.S. wants the Chinese to have access to the controller chips for a disk drive. One never knows what the Chinese could do to instrument the drive.”

I'm not an engineer. I have no idea what the ins and outs of controller chips are. But I do know that Seagate's largest facility in the world is in Wuxi and has been for 12 years, and that if you wanted to have access to controller chips, you would engage in the sort of corporate espionage mentioned above. Buying the company would seem a great way to advertise that you might be spying on people, which usually makes them run away. As for "one never knows what the Chinese could do...", that sounds like complete horseshit. It's a chip, not the Sword of Greyskull.

Three days later, the Seagate story was dead:

HONG KONG (Reuters) - Seagate Technology (STX.N), the world's largest maker of disk drives, has dashed speculation that a Chinese firm wanted to buy the firm, saying it had received no such offer and had no intention of selling.

This month The New York Times, citing an interview with Chief Executive William Watkins, reported that a Chinese technology firm had made overtures to Seagate.

But the U.S. company said on Tuesday that Watkins had in fact merely referred to growing interest in disk drives technology from companies in China, Japan and Korea in concert with their respective governments, which had made disk drive storage "a national agenda."

In fact, the only quote from CEO Watkins in the NYT story was:

“The U.S. government is freaking out"

They are apparently not the only ones.