http://www.wired.com/threatlevel/2008/05/leaked-cisco-do/
and
http://www.nytimes.com/cfr/international/slot1_021606.html
If China got their gear through shell companies in the West that would be one thing but to find outright proof that Cisco (and Juniper Networks) knew the destination of the hardware they sold and were cooperating with the Chinese authorities on this is unforgivable.
Their excuse is that 'other companies would do the same thing if they didn't do it'.
Selling hardware with deep packet inspection capabilities to repressive regimes should be against the law.
And maybe DPI should have never been added as a feature to begin with, the downsides of a feature like that are much larger than the upsides.