Google vs. China – Moral Stand or Calculated Business Move

Posted on Monday, January 18th, 2010 by Print This Post Print This Post

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After experiencing what it called a “highly sophisticated and targeted attack” in China, Google told the largest Internet market in the world to take a hike this week. According to The Official Google Blog, the cyber attack targeted Google’s corporate infrastructure, and the primary objective of the attackers was “accessing the Gmail accounts of Chinese human rights activists.” Wired reported that more than 30 other large companies were also targeted in the attack. Increased concerns over security and censorship have prompted the world’s biggest search engine to reconsider its place in the Chinese market. “We have decided we are no longer willing to continue censoring our results on Google.cn, and so over the next few weeks we will be discussing with the Chinese government the basis on which we could operate an unfiltered search engine within the law, if at all,” the company said. “We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.” Hours after announcing their new stance on China, Google started relaxing their self-censoring on Google.cn. There have been reports that Google’s Chinese employees were put on paid leave, and Google’s fans in China have left flowers, candles and cards of support. Google’s new China approach has been met with mixed reaction across the globe. Some have praised the move as “a victory for freedom and free enterprise.” Hillary Clinton wants a response from the Chinese government. “We have been briefed by Google on these allegations, which raise very serious concerns and questions,” she said. “We look to the Chinese government for an explanation.” In one of the few responses to come from the Chinese government, Jiang Yu, a spokeswoman for the Chinese Foreign Ministry, said that “China welcomes international Internet companies to conduct business within the country according to law.” Others have said that Google’s decision to talk tough about human rights and take the moral high ground on censorship is really more of a business decision than anything else. According to Analysis International, Baidu, China’s top search engine, owned 63.9 percent of the market share in the third quarter of last year. Google claimed 31.1 percent. With Google unlikely to dominate search in the country, walking away from the Chinese market, as massive as it is, may still be a wise business move. Google’s been battling China on a host of issues lately, from restricted access to Gmail and Google Docs to accusations of digital library copyright infringement and even a porn crackdown back in June. When Google first entered the Chinese market in 2006, the company’s position was that “the benefits of increased access to information for people in China and a more open Internet outweighed our discomfort in agreeing to censor some results.” So is this an example of Google championing their cause to not be evil or is the decision more about the company’s bottom line? What do you think?

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3 Responses to “Google vs. China – Moral Stand or Calculated Business Move”

  1. Ted Ives says:

    I suspect the IP theft is really what’s driving Google’s response (human rights has always been an issue).

    China and France are both well known in Competitive Intelligence circles to have business cultures in which unethical competitive behavior is far more likely to occur (a good source for info on how to protect your company is the Society of Competitive Intelligence Professionals – http://www.scip.org). At a SCIP gathering some years back, an expert on Competitive Intelligence in China related to me that in China, placing an employee inside a competitor’s organization happens far more often than one might think.

    It’s stunning to imagine that any major US firm would locate critical IP in China at all after the many high-profile incidents, even back here in the states, that have occurred…search on any of these for some interesting incidents:
    [Quantum3D source code theft]
    [netlogic blueprints prosecution]
    [boeing economic espionage]

  2. Richard says:

    I agree with Ted. Though I would say it is probably a bit of business influencing their decision too. If they keep playing the censorship game then they will keep trailing that Chinese search engine. If they play rebellious then it perhaps they will get more “street cred” in China. You’ve got to stand out and this is the right time to ride that PR wave.

  3. IMHO this is 90% business decision and the moral stand is a nice PR win by-product.

    Not questioning the morality of Google (how dare I!) and their overall desire to do good, I would however question the timing, insistent indignation and complete avoidance of bottom line rational in their explanations on the pull out.

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