WASHINGTON—The Obama administration faces a major impediment in tackling Chinese cyberspying: It must convince the Chinese there's a key line between government spying and corporate spying.
While nations often spy on one another, the U.S. wants to draw a hard line at governments spying on the private sector. That's a difficult concept to present to leaders of a country where many companies are government-directed.
FORTUNE -- Thursday night, after the Guardian broke news of Verizon's involvement in a massive domestic spying operation by the National Security Agency, the Washington Post and the Guardian both revealed the existence of a program called PRISM -- a means by which the gov