Brownback, a republican representing Kansas, said he received a document issued by the Chinese Public Security bureau, which orders hotels to install spying equipment on their internet connections and threatens owners with “severe retaliation” – including the possibility of losing their operating licenses – should they fail to comply.

“These hotels are justifiably outraged by this order,” said Brownback at a news conference Tuesday, noting that it forces them into the “awkward position” of having to “craft pop-up messages” informing guests of their loss of privacy.

Brownback said he received a copy of the original document, translated from Chinese, from attorneys representing two different “foreign-owned” hotel chains. The companies want to remain anonymous so that they don’t face further reprisal. Several other international hotel chains confirmed the order.

An AP report said the Chinese embassy was unavailable for comment.

According to the memo, hotels were told that “all hotel rooms and offices” are considered subject to “on-site or remote technical monitoring at all times.”

With little more than a week remaining before the 2008 Summer Olympics begin in Beijing, Chinese hotel owners appear to have little choice. Despite their outrage, hotel companies are more concerned about the long-term repercussions of non-compliance – failure to obey could place an entire company’s operations in jeopardy, potentially locking them out of a lucrative, growing Chinese market.

Meanwhile, athletes and participants staying at the Olympic Village have a unique set of woes for their internet access: an IT contractor recently leaked a list of rates for DSL service charged by BOCOG (Beijing Organizing Committee of the 2008 Olympic Games), with the cheapest option being a 512/512 kilobit line available for 11,700 RMB ($1716.05 USD). 

“I just can't believe that not only do I have to deal with the Great Firewall of China, but also pay through the nose to use it!” wrote the anonymous contractor.

According to Australian newspaper The Age, the International Olympic Committee issued a formal apology Wednesday for “misleading” the world’s press about the China’s “open internet” pledge. Senior IOC member Kevan Gosper, who originally delivered the promise of “unfettered freedom to report in China,” said he was unaware of the apparently backroom negotiations with Chinese censors, which will keep a number of “sensitive sites” blocked from access.

Age reporters said they were unable to access a number of sites involving human rights discussions, Tibet, and the Falun Gong, with merely intermittent access to a larger portfolio of websites including the New York Times, BBC China, al-Jazeera, Radio Free Asia, and Taiwanese newspapers.

 BOCOG spokesman Sun Weide said that China promised journalists that they would “be able to use the internet for their work during the Olympic Games. So we have given them sufficient access to do that.”