Cisco Systems Inc, the giant network equipment supplier, has denied accusations of conducting illegal monitoring activities in China, as well as participating in the US surveillance program that whistleblower Edward Snowden has revealed.

In a statement sent to China Daily on Tuesday, Cisco said, "PRISM is not a Cisco program and Cisco networks did not participate in the program."

Further, Cisco does not monitor communications of private citizens or government organizations in China or anywhere in the world, the statement added.

PRISM is a clandestine Internet surveillance program operated by the US National Security Agency.

Cisco's response came as the Chinese media questioned whether the company represented a threat to China's national security.

Snowden, a former NSA contractor, revealed in an interview with the South China Morning Post that he believes there has been more than 61,000 NSA hacking operations globally, including hundreds in Hong Kong and on the Chinese mainland.

Since Cisco has played an active role in building major network projects in China, covering fields such as governments, army, finance and railways, Chinese media have expressed concern that the US-headquartered company could be used as a US government tool to steal critical information from China.

After entering the Chinese market in 1994, Cisco's business has grown fast, and it now employs more than 3,400 staff nationwide, according to its website.

John Chambers, Cisco's chairman and chief executive officer, has highlighted the Chinese market as one of its three main growth engines, along with India and its home market.

Using two networks operated by China Telecom Corp Ltd and China Unicom (Hong Kong) Ltd, which shoulder more than 80 percent of China's Internet traffic, Cisco is said to have built a 70 percent share of the country's leading network projects, a Securities Times report said.

A Beijing-based industry insider, who asked to be anonymous, said, "There is a terrible security threat in China from US-based technology companies including Cisco, Apple and Microsoft."

When China first installed its networks, users had no choice but to buy Cisco's equipment since domestic companies did not own certain technologies, he added.

"Cisco was to the networking industry what Boeing or Airbus were to aircraft manufacturing. The situation only gradually changed as Chinese players like Huawei Technologies Co Ltd and ZTE Corp grew in recent years," he said.

Xu Qi, a Beijing telecom industry expert, said the Chinese authorities should conduct investigations into Cisco's network in China.

"Based on sound evidence, market restrictions should be adopted, if it truly represents a threat," he said.

Chinese telecom equipment giants Huawei and ZTE have been banned from selling their products to major US carriers after being accused of posing a potential threat to US national security. Both have denied the allegations.

(China Daily USA 06/19/2013 page15)