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High-tech companies defend practices in China

Four U.S. high-tech companies on Wednesday found themselves branded collaborators with the Chinese government in suppressing dissent in return for access to a booming Internet market.

House members contended that Microsoft Corp., Yahoo Inc., Cisco Systems Inc. and Google Inc. sought to explain their business practices in China only after a recent crush of negative media and government attention.

"Your abhorrent actions in China are a disgrace," said Rep. Tom Lantos, the top Democrat on the House International Relations Committee. "I simply don't understand how your corporate leadership sleeps at night."

Yahoo's senior vice president and general counsel, Michael Callahan, said his company was "very distressed" at having to comply with Chinese law.

Rep. Jim Leach, R-Iowa, said Google seemingly had acted "as a functionary of the Chinese government. . . . This is astonishing."

Analysts say U.S. high-tech companies trying to tap a market of more than 110-million Internet users also must worry about the perception they are helping China harass dissidents.

To do business, U.S. companies must satisfy a government in Beijing that polices Internet content. Policies include:

+ Filters that block objectionable foreign Web sites.

+ Regulations banning what the Chinese consider subversive and pornographic content.

+ Requiring Internet service providers to enforce government censorship.

Microsoft's associate general counsel, Jack Krumholtz, said his company was committed to staying in China because of the Internet's potential for allowing free access to information. "We think the benefits far outweigh the downside, in terms of promoting freedom of expression," he said.

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