Caixin
Feb 19, 2013 07:34 PM

In Depth: Dirty Business for China's Internet Scrubbers

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Flames of a public relations disaster were licking at the heels of a private equity firm when China's most notorious Internet-scrubbing company rode to the rescue.

Saving the Shenzhen-based firm's image was not cheap, and it took more than two months to douse the flames of Internet news reports and rumors claiming executives had used a Ponzi scheme to bilk investors.

From a technical standpoint, however, deleting every image-stinging accusation was relatively easy for a team of public relations specialists at Yage Time Advertising Ltd., which for a price deleted Internet postings of all kinds according to client specifications before a police crackdown on Internet scrubbing last year.

The company's founder, 30-year-old Gu Dengda, is awaiting trial on a variety of charges including bribery. He's one of at least 10 Internet clean-up specialists currently being detained by police. And Yage is one of several companies closed over the past year by authorities for turning China's website administration process into an illegal money machine.

The last vestiges of China's web-scrubbing industry were apparently wiped out in July when police raids targeted Yage and a related public relations firm in Beijing's Haidian District. More than 100 employees – even janitors – were detained. Authorities were so determined to leave no stone unturned that every uniformed officer in the district was dispatched for the raids, even a forensic examiner.

The Haidian clampdown had its roots in a national campaign launched three months earlier by four central government agencies – the Propaganda Department of the Communist Party's Central Committee, the Ministry of Industry and Information Technology, the Ministry of Public Security, and the State Administration for Industry & Commerce – aimed at uprooting website administrator bribery and other illegal, Internet-related public relations activity.

Targets included employees at public relations firms, major news portals such as Netease and Sohu, the Beijing-area news portal Qianlong, Internet search giant Baidu and local government Internet regulators.

A primary goal was to finally stop the moneymaking scheme that Gu started and Yage perfected before being imitated by other businesses across the country. His and other businesses rescued companies from image-damaging content on the Internet by paying website operators to delete posts and news articles. They would also arrange to beef up online reputations for companies and government officials.

Most of those detained during the Haidian raids were caught by surprise. While under interrogation, police said, several shook their heads "no" after being asked whether they knew that deleting web posts was against the law.

Wealth Track

Gu, whose name in Chinese means "reaching prosperity," found a shortcut to fortune in 2006 after learning how website operations work as a low-level staffer at China's largest search engine Baidu.

He decided money could be made based on the fact that at that time Internet users were posting more than 2 million messages on Baidu's public forums every day. In addition, news and information website readers were posting massive numbers of reader comments.

By deleting postings and comments that painted a negative picture of a company or individual, Gu decided he could make a decent living.

Gu's knowledge of Baidu's website-user rules worked to his advantage. He knew, for example, that the search engine's around-the-clock complaint department would work with website technicians to quickly remove any posts about which they received a Baidu-user complaint. At that time, blog posts, comments and other data could be scrubbed based entirely on a single complaint.

Moreover, Gu knew how to make direct contact with website administrators and their colleagues. This skill – coupled with his ability to grease palms and cultivate good relations with website staffers – proved to be the key to his business success.

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