Precisely how? I can't tell you the methods they specifically used, but when a computer or a device tries to connect to a network, broadly speaking, there are multiple steps of handshaking involved and continuous acknowledgement that the connection is still active. Most information is transmitted in the clear.
If you want to do something fun, get the program called Wireshark, then go to a public place, like a mall for example and run it. It looks like this:
That may look like greek to you, but to me, I see what websites everyone in the room is looking at.
Wireshark is a packet sniffer, which means (pasted from it's definition
http://internet.wonderhowto.com/how-...eshark-424506/
Where do people learn how to do this? Well it's easy and on the internet, but I learned how to do it in a class room, in school, from a professor, in an academic setting. He actually did it to my class, years ago, to illustrate how packets work. Wireshark is hardly a hackers tool, but it goes to show how easy it is. You just have to run it and be in a room and traffic, mostly unencrypted, is easily intercepted and analyzed.
That's why people concerned about privacy come off as so utterly backwards. The above facts are shocking to them, but it's inherent to the technology and always has been. If you've been using Wifi the past decade and change it's been on the consumer market, you've been basically putting up a billboard saying "I'm here! This is what I am reading", wherever you are. You really wanna be stupid? Use airport wifi, hotel wifi or public wifi. When I go to a hotel, I use their wired connection, because of exactly this.
Wirless means information can broadly be intercepted, period. It always has and it always will. People truly concerned about privacy will use wired, and have air gaps between their device and the host when not using it. And also not use a cellphone. Or GPS. You say "how the hell could they?". The truth is, the correct statement is "That is utterly unsurprising."
Here's some info on Russia and China's hostile environment:
http://www.nytimes.com/2012/02/11/te...ewanted=1&_r=0