Recently, the Guardian released a very interesting article about the upcoming ban on VPNs in China. To summarize, under the current communist regime, the Chinese population faces a greater incidence of internet and media censorship than other parts of the world. In fact, it is widely regarded as one of the strictest and largest censorship systems in the world, blocking access to many mega-sites like Google and Facebook, amongst other extremely popular social media outlets. This curtails the news and opinions that are available to Chinese citizens through the internet, and is collectively known as “The Great Firewall.” Much of the population has circumnavigated this firewall with the use of VPNs, which allow them access to private, encrypted, and expensive networks. Many of the VPNs being utilized are foreign, something the Chinese government has never condoned. The government’s new Cybersecurity Law dictates where companies can move data generated in China, and it requires foreign firms to store data within the country. All of this is part of the government’s effort to restrict cross-border data flow.

Recently, the government ordered its state-owned telecom companies, China Unicom, China Telecom, and China Mobile, to block access to VPNs by February of 2018. This comes on the heels of an announcement to increase internet sovereignty, a move which could upset not only the part of the population that uses these services to access content, but also foreign businesses that rely on VPNs for data security in their overseas locations.

Businesses with locations or hardware in China often rely on VPNs for data security and communication between locations, business partners, and suppliers overseas. If they can no longer utilize VPNs, it is likely that operation costs will go up significantly in an effort to find another route with which to move data. Depending on what level of enforcement eventually gets passed into permanence, it could disrupt the operations of the industry to the point that businesses would have to remove their Chinese locations, or greatly reduce their dependence on them.

In addition to the repercussions this will have on the telecom industry, other consumer industries will be feeling the effects as well. Hotels that offer VPN use to guests will have to stop the service, making it close to impossible for foreigners to access any of their personal data while they are in the country. The decision will also further hurt universities and other scholastic organizations in China, as it will further restrict their access to foreign research, methods, and archived journals. Many universities also rely on code hosted outside of China for their websites, which would make their websites unnavigable once the crackdown takes effect. Some foreign companies are rushing to comply with this new rule, hoping to preemptively ease relations with the country. Apple announced this summer that it is building its first data center in China to comply with the restrictions, and it has removed VPNs from its Chinese iOs appstore. Likewise, the company that runs Amazon’s cloud services in China has agreed to no longer support VPN use.

The only real alternative for foreign businesses to abide by the new restrictions is encryption, which can be done with software or hardware. This can get very expensive, depending on the resources available to the company, as the hardware route can drive costs up more than the software route. There is a leased special circuit, available from state-owned telecom providers, that would allow a direct connection between their Chinese and overseas operation. However, such a service could cost upwards of $1000 per month, on top of other potential operating costs. Also, because these routes are provided by Chinese-owned firms, they will still be “controlled.” While these circuits have this level of control, there is no guarantee that they will remain private.

It is evident that companies operating at any level in China could benefit from help planning their network routes. This is a complication that will require expertise in network planning specific to global data — even more specifically, to data transport and storage in China. Many companies would be smart to leverage subject matter experts who can help them plan an alternative to their current situation if they are presently utilizing a VPN to conduct their business.

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