Computerworld has a very interesting story about the Google/China flap.
Reporter Robert McMillan quotes an unnamed source:
...they [hackers] apparently were able to access a system used to help Google comply with search warrants by providing data on Google users, said a source familiar with the situation, who spoke on condition of anonymity because he was not authorized to speak with the press. "Right before Christmas, it was, 'Holy s***, this malware is accessing the internal intercept [systems],'" he said.
Google was already hosting a spy system that provided the Chinese government, and any other government with user data. They merely had to request that data through a warrant. That internal spy system became the weak spot in Google's security technology.
But why would the Chinese government try to hack into a system that was already providing it with user data?!
Clearly, the Chinese government was looking at collecting data on all other Google users, not just human rights activists. China was trying to spy on us all! And Google's internal spy system compromised all its users.