Chinese government

In an international Internet drama, Google seems closer to ending operations in China after threatening two months ago to pull out of the market. Google's Chinese-language search engine is the only major foreign competitor in the communist nation.

According to The Wall Street Journal, a person familiar with the situation said Google is likely to take action within weeks. Meanwhile, Chinese government officials told state news outlets that Google's Chinese site is likely to close, and that if Google exits, those news outlets are required to publish only government accounts.

Google Inc.'s CEO said Wednesday the Internet search company is in active negotiations with the Chinese government and expects some resolution in its dispute with Beijing soon.

Speaking at a media conference in the Middle East, Eric Schmidt declined to provide specifics or predict how long the discussions would last, saying that the company has decided not to publicize details of the talks.

Evidence is accumulating that the Chinese government was in fact behind attacks on Google and other major U.S. companies, investigators say. The New York Times reported the attacks have been traced to two schools in China, one of which has close ties to the Chinese military. The attacks likely originated in April, months earlier than previously believed, the sources said.

Government officials continue to put pressure on U.S. technology companies to stop censorship in China. Sen. Dick Durbin (D-Ill.), chairman of the Senate Judiciary Committee's Subcommittee on Human Rights and the Law, is joining other government officials to fight censorship in China and other countries.

Google might think Chinese censorship of the Internet is unacceptable, but Bill Gates says it's not that bad. In an interview with George Stephanopoulos on ABC's Good Morning America, Gates called China's attempts to censor the Internet "very limited," and said its controls are not much different than other countries' policies.

Even if Google's stand against censorship leads it to close its search engine in China, the company still hopes to maintain other key operations in the world's most populous Internet market.

Google Inc. is in delicate negotiations with the Chinese government to keep its research center in China, an advertising sales team that generates most of the company's revenue in the country and a fledgling mobile phone business.

Both sides are torn by conflicting objectives.

China is building its cyberwarfare capabilities and appears to be using the growing technical abilities to collect U.S. intelligence through a sophisticated and long-term computer attack campaign, according to an independent report.

Released Thursday by a congressional advisory panel, the study found cases suggesting that China's elite hacker community has ties to the Beijing government, although there is little hard evidence.

China Mobile, the world's largest cellular operator, has an answer for Chinese consumers impatient to get their hands on Apple's iPhone. The market has plenty of pirated and smuggled iPhones but Apple hasn't concluded a deal with a Chinese carrier to carry legitimate versions of the hot handset. So China Mobile, which had negotiated unsuccessfully with Apple to launch the iPhone, has an offer for its users: Can't wait for the iPhone? Try the OPhone instead.