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What Google is Trying to Do in China

Gambling for Free Speech, and Losing
13 January 2010

by Daniel Michaeli

GoogleGoogle’s decision yesterday to begin reviewing “the feasibility” of its business operations in China has reverberated around the world, particularly in the high tech sector. Responding to the hacking of its corporate network and the accounts of Chinese human rights activists, Google is threatening to leave the Chinese market entirely, and says it is no longer willing to censor its search results on Google.cn.

What is Google’s strategy here? And what happens next?

Google’s statement reads, to me, like pure frustration and anger, not strategy. Human rights advocates are heartened by this move, which suggests finally that Western countries can stand up to Chinese authorities; but the outcome of this mess is likely to be bad for Google’s corporate interests and detrimental to the goal of developing freedom of speech in China.

Google obviously has much more to lose in departing this market than the Chinese government: it currently has about 36% of the Chinese search engine market and numerous other efforts in China in the online advertising, mobile (Android), and music spaces. Chinese and Indian markets provide Google with the greatest potential opportunities in the long term, and re-entering the Chinese market after leaving could prove very difficult. Leaving China would make it even more difficult for Google to prevent Chinese companies from gaining in the Chinese market by stealing from Google outright.

From the Chinese perspective, less Google means more space for domestic players to grow. With its massive domestic market, China can ignore the argument that weaker international competition means less domestic innovation. Google’s departure would give the government even more direct control of search results and algorithms through Chinese companies, and–most dangerous of all–it would send a message to all other international companies that they must play by China’s rules, or else.

For the Chinese government to cave in and begin allowing Google to display uncensored search results is inconceivable for many reasons. Here are two: First, Chinese authorities have long seen a “marketplace of ideas” as incompatible with the long-term maintenance of one-party rule, which is non-negotiable. Second, the communist party, particularly under Hu Jintao, seeks to build internationally competitive companies by sheltering them from foreign competition in the domestic market and helping them undercut competitors abroad with state financing and government contracts. Google’s departure would open up tremendous opportunities for local companies willing to play by the government’s rules.

The principle of freedom should be a guiding factor here. But will Google’s move improve freedoms in China? Exiting the Chinese market would not stop Chinese authorities from attempting to hack into the Gmail accounts of dissidents. And it would have a chilling effect on other foreign companies that might have been aiming to push the envelope more gradually, the approach Google itself was following.

Google has yet to end its censorship of search results. As of today, a search for Tiananmen on Google.cn still produces heavily skewed results, with the note “据当地法律法规和政策,部分搜索结果未予显示” displayed below the results (roughly: “In accordance with the local laws and regulations, a portion of search results are not allowed to be displayed.”).

Last year, Chinese netizens were able to reverse China’s decision to mandate the installation of the “Green Dam” Internet filter on individual computers. But that success was only possible because the Chinese government maintains many other mechanisms for censoring the Internet. Giving in to Google here would mean giving up all of those mechanisms. Instead, China will call Google’s bluff.

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