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NetQin denies claims that it uploads malware with its antivirus software

Matt Hamblen, Computerworld | March 25, 2011
NetQin Mobile on Friday denied reports that claimed it had deliberately installed viruses on customers' mobile phones along with its antivirus software and then charged customers to remove the malware.

NetQin offers mobile security products as well as mobile productivity and intelligent cloud services, primarily for smartphone users. About 35% of NetQin's revenues in 2010 came from subscribers outside of China. Frost & Sullivan has reported that NetQin had 67% of China's mobile security market at the end of 2010.

NetQin was founded in 2005 in Beijing; it established a presence in the U.S. in November 2010.

NetQin's 161-page IPO prospectus notes on page 17 that China Central Television (CCTV) ran a report of complaints of fraudulent practices against NetQin. One practice the TV report claimed NetQin engaged in was the uploading of viruses to imported mobile phones to promote NetQin's security products.

The uploading of viruses was reported to have been done by Beijing Feiliu, a company one-third owned by NetQin, but NetQin said in the prospectus that it does not believe it has committed any wrongdoing, and it said it would publicly explain its practices.

However, NetQin further said in the prospectus that because CCTV "has wide coverage and perceived authority, such negative publicity has adversely and severely damaged our brand, public image and reputation, which may seriously harm our ability to attract and retain users and result in material adverse impact on our results of operations and prospects."

One security Web site, reported, has more details about the connections between Beijing Feiliu and NetQin, including claims that NetQin does remove the Feiliu app for a small fee.

One analyst, Jack Gold of J.Gold Associates, said in an interview that NetQin had not specifically said in its statement this week or in the prospectus that it never uploaded malware, directly or indirectly, with its legitimate software.

"Maybe I am getting too skeptical in my old age, but NetQin didn't actually say that they didn't load a malware stub on the product and then make people pay to get it removed."

Gold said it would be interesting to hear Research In Motion's reaction to the antivirus software for BlackBerry that NetQin announced this week. RIM did not respond to a request for comment.


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