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BEIJING, China (CNN) -- Individual computer users in China may choose whether to install a controversial content filtering system, but the system will be installed on computers in any public place, China's minister of Industry and Information Technology said Thursday.
People sit at a wireless cafe in Beijing, using their laptop computers.

People sit at a wireless cafe in Beijing, using their laptop computers.

China announced earlier this year that it planned compulsory installation of the Green Dam-Youth Escort software, ostensibly meant to protect young online users from pornography.

The installation was postponed on June 30. Minister Li Yizhong said Thursday that his ministry was still working on its plans and that the Green Dam software was also being upgraded, China's state-run news agency Xinhua reported.

"Installation is intended to block violent and pornographic content on the Internet to protect children," Li said, according to Xinhua. "Any move to politicize the issue or to attack China's Internet management system is irresponsible and not in line with reality."

Businesses and computer users complained that the software left computers open to cyber attacks, while others worried that the software represented government interference in the free flow of information.

Trade groups representing the largest international businesses in China sent a letter directly to Premier Wen Jiabao on June 26. Read more about business concerns over Green Dam

The software requirement "raises serious concerns for us and poses significant questions in relation to security, privacy, system reliability, the free flow of information and user choice," the EU Chamber of Commerce, which also signed the letter, said in a statement.
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Companies such as Intel, Microsoft and Yahoo built their business on transparency and free flow of information. Yet for all the capitalistic reforms since 1979, public information in China is still tightly controlled and government decision-making is opaque.

At stake is a market of about 300 million Internet users, according to the China Internet Network Information Center.

Green Dam is produced by Jinhui Computer System Engineering Co., which is said to have ties to China's military and security ministry. Zhang Chenmin, general manager of Jinhui, told the state-run news agency Xinhua that his company had received more than 1,000 harassing calls and death threats since news of the requirement and Jinhui's role were first reported in The Wall Street Journal in June.

Besides angry Chinese computer users, Jinhui faces accusations from California software maker Solid Oak that Green Dam copies code from its Cybersitter software for parental Internet-access control. Jinhui has denied the claim. Learn more about how China filters the Internet »

Corporations, typically reticent to publicly squabble with Beijing, are drawing a line on Green Dam because the software "is buggy. ... It's ineffective for its advertised purpose" of filtering pornography, but also can be easily manipulated so computers can be remotely accessed by unknown third parties, said Thomas Parenty, an IT security consultant in China and a former U.S. National Security Agency programmer.

Criticism of the new policy was rampant abroad, at home and even on China's own state-run media, a sign that officials may disagree about it internally.

The software dispute is the latest in a line of controversies between Western companies and the Chinese government.

In 2000, the government backed down on laws restricting importation of encryption software that would have banned Web browsers such as Microsoft Explorer, which include encryption functions.

In 2004, the government backed down on developing its own wireless Internet standard when Intel threatened to ban sale of its chips in China as a result.

More recently, Web browsing companies have had a complicated relationship with Chinese censors.
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Early last month, Google blocked search results for Tiananmen Square in China. In late June, it was reported that Google service in China was interrupted after government claims that it was contaminating the country with pornography. In 2005, Yahoo released user information that led to the arrest and 10-year sentence of a Chinese journalist.

Technology companies say they are obeying local laws concerning Internet use in China, but the companies have been criticized by members of the U.S. Congress for bowing to pressure from Beijing.