Sprint Has to Hang Up On Softbank

Chinese hackers, many of whom collect their paychecks from the People’s Liberation Army, may be having a big celebratory bash soon. Their jobs will likely get a whole lot easier.

That’s because Sprint, one of the major owners and operators of broadband internet infrastructure in the U.S., may be on the verge of inking a deal to sell off a major chunk of its network to Softbank. Softbank is a Japanese company that relies heavily on its ties to the Chinese telecommunications industry for parts and support. The Japanese company offered Sprint $20 billion for a 70 percent stake in Sprint Nextel.

Chinese telecom is not a private industry like here in the U.S. In China, the telecom industry — like most of the country’s industries — is a quasi-government entity; it’s been the Chinese government which is behind the PLA’s hacker unit’s recent ferocious launch of cyber-attacks against the U.S.

Allowing Sprint to go through with the sale would potentially give the PLA the keys to critical high-speed networks here in the U.S. Such a sale would make it a cakewalk for Chinese hackers to breach and infect U.S. broadband networks.

Here’s what Sprint will be giving away in the proposed sale: more broadband spectrum than any other telecom company in the U.S.; 40,000 miles of high-speed optical network that forms much of the critical backbone for public and private networks; service contracts with the Department of Defense and the Government Services Administration; and secure PIP, peerless networks isolated from the public internet, that the U.S. government uses for highly secure communications.

It’s true — and a concern — that many American telecom companies use components from China in their systems, but it is far more difficult for U.S. cyber-security officials and regulators to keep tabs on a Japanese company using Chinese equipment than it is to investigate an American company.

As it is, Chinese hackers have committed serious breaches of U.S. computer systems. Security experts have pointed the finger at the PLA’s cyber unit 61398 as the group that has stolen vast amounts of data from U.S. companies and Federal agencies. Recently, it was revealed that Chinese hackers stole data in 2011 from Google servers that would identify which Chinese operatives were under surveillance by the FBI and other law enforcement agencies. The FBI had asked Google to tag certain users for
surveillance. A similar breach hit Microsoft’s servers at the same time. This month, for the first time, the U.S. Defense Department cited Chinese cyber-attacks on the U.S. in a report on Chinese military capacities.

According to security experts, hacking damage from the PLA runs into hundreds of millions of dollars a year. A report compiled by the Financial Times put the figure at $873 million in 2011 alone. Companies have had their intellectual property stolen, and their networks crashed under attack from Chinese hackers. Hackers have ransacked the corporate secrets of such American firms as Lockheed, Boeing and Apple.

Virtually no U.S. institution, corporation, media outlet or government agency has gone without being cyber-blitzed by the Chinese. They have attacked Bank of America, The New York Times and The Wall Street Journal. Richard A. Clarke, former White House terrorism adviser and cyber-espionage expert, said that the Chinese are “stealing our intellectual property. They’re getting our research and development for pennies on the dollar.” According to Clarke, Chinese hackers also have the capability to hit the critical computers that run our infrastructure: they can throw a cyber-wrench into our power plants, satellites and subways. Wall Street traders could one day be staring at blank screens, courtesy of a cyber-attack from an IP address in Beijing.

China has also unleashed its army of hackers to disrupt web sites that don’t agree with its policies. They have lifted data from sites that support Tibet, hacking into databases of e-mail addresses and donors. In 2008, hackers traced back to China got their sticky fingers
on data from the Save Darfur Organization’s databases. The organization had been trying to pressure China to lean on the Sudanese regime to stop the mass killings in Darfur. China is Sudan’s largest trading partner.

Sen. Charles Schumer (D-NY) has been very vocal about his concern over the sale. In a letter to the Federal Communications Commission and the Federal Trade Commission, Schumer wrote, “I have real concerns that this deal, if approved, could make American industry and government agencies far more susceptible to cyber-attacks from China and the People’s Liberation Army.”

Until China backs down from its ferocious and criminal intrusions on U.S. computer systems, it’s vital that we make it as difficult as possible for hackers to penetrate our networks. Sprint has to put its business interest aside in the interest of protecting our critical infrastructure.