BEIJING - China told companies to back state control of the Internet on Thursday, showing no sign of giving ground on censorship after U.S. Internet giant Google threatened to quit the country.

Minister of the State Council Information Office, Wang Chen, said that online pornography, fraud and rumors were a menace. He said Internet media must help guide public opinion in China, which has the world's biggest number of Internet users at 360 million. He did not mention Google.

Wang's comments suggested little room for compromise in the Internet dispute that could stoke tensions between China and the United States, already at odds over the yuan currency, trade, climate change, and Taiwan.

If you look at the overall internet industry, it is becoming increasingly repressive, not just for Google for but the whole industry, said Elinor Leung, an industry analyst for CLSA in Hong Kong. The reason is the explosive Internet user growth, and the Chinese government wants to ensure control.

Internet companies should help China's one-party government steer the fast-changing society, said Wang, whose Information Office is the government arm of the China's propaganda system.

Our country is at a crucial stage of reform and development, and this is a period of marked social conflicts, said Wang, whose comments appeared on the Information Office's website. Properly guiding Internet opinion is a major measure for protecting Internet information security.

WON'T BOW TO U.S. DEMANDS

Google, the world's top search engine, threatened to shut its Chinese-language google.cn website and offices in China because of cyber-attacks from China on Chinese dissidents using its Gmail service and on dozens of foreign companies.

Cyber-experts said more than 30 firms were victims of attacks that used tailored emails to deliver malicious software that exploited vulnerabilities in the popular Adobe Acrobat and Adobe Reader software.

Wang said his country was the victim of hackers, and suggested his government would not bow to demands from the United States and other countries to loosen Internet restrictions.

Of the complaints received by the government about Internet pornography, the great majority concerned Internet sites and servers abroad, he added.

Hence, all countries in the world must be active in adopting measures to strengthen effective governance of the Internet.

Google's threat to pull out of China has ignited debate among Chinese people, divided between a thirst for free-flowing information and nationalist rancor against foreign criticism.

About a dozen Chinese fans of Google held an impromptu candlelight vigil at its Beijing headquarters late on Wednesday. Earlier, others had brought bouquets of roses and lilies.

He Ye, a woman at the vigil, said finding alternative news would become more difficult if Google pulled out.

If I cannot search for it through Google, I'd feel I lose a part of my life, she said.

A comment on the website of a Chinese-language tabloid, the Global Times, said Google was threatening to quit China because it had been beaten by the home-grown Baidu search engine.

Our largest Chinese search engine has thoroughly defeated the American leader, and we can again rejoice in the global arena, said the comment. It also shows that nowhere can we not match up to the United States.

SECURE COMMERCIAL ENVIRONMENT

A law firm representing a U.S. software maker that is suing China for code theft also said it had been targeted by hackers from within China.

U.S. Commerce Secretary Gary Locke urged China on Wednesday to ensure a secure commercial environment for U.S. companies.

The recent cyber intrusion that Google attributes to China is troubling to the U.S. government and American companies doing business in China, Locke said in a statement.

This incident should be equally troubling to the Chinese government. The administration encourages the government of China to work with Google and other U.S. companies to ensure a climate for secure commercial operations in the Chinese market, he said.

(Additional reporting by Melanie Lee in Shanghai and Jimmy Guan and Benjamin Kang Lim in Beijing; Editing by Bill Tarrant)

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