Tech Thursday: Google v China

I started Tech Thursday with a Google-themed post - even a Google v 'X' post - so it's fitting my 4th post returns to Google (wait...what? why is that fitting?). Google and China have not been getting along lately. We all know this; we also all know it's gotten bad enough that Google has "shut down" it's servers, and is redirecting all users to I enjoyed Wired's brief FAQ article today primarily due to it's snarkiness, but it also does a good job of summing up the current state-of-affairs for the issue.

This whole situation is an interesting issue to me for 2 reasons:

1) Google and its internal battle over being a successful company and doing-no-evil. China is a HUGE opportunity for Google as a company - it, sans hyperbole, has hundreds of millions of potential RGUs that would help Google maintain its search dominance. One small problem: Google does no evil. How does the company that situates itself as the leading consumer-oriented company self-censor its searches to gain profits balance this against it's do-no-evil mantra and it's quest to bring the world's information to the fingertips of the world's population?

2) China and its internal battle over control and international respect. China showed great promise, economically at least, in becoming a modern power, yet the government never showed any intent to open up politically and/or socially - the unlikely fiscal liberal-social conservative (yes, small sample - blah blah blah) if you will. I don't anyone in their right mind could say they doubted China's desire to be a main cog in all world affairs - something I think we'll see before our generation cedes control to our children. However, how they get there remains to be seen. Will they remain stubborn and do so through soft-force (e.g. "you'll have to work with us since we posses much political/economic power."), or will they open up and emerge through collaboration?

My guess as to how this plays out: Google tried to meet China on their terms (self-censorship and soft-force), yet China showed no reciprocity over the past 4-5 years. Google has emerged from this first act in better light than China - also a result of outside factors affecting China's reputation. I agree with Zachary Karabell and expect China to maintain it's current world-stance, and for other businesses to attempt to work with China - again, on their terms - in order to realize potential profits. However, I expect China's social/political stances to weaken in the long-run (read: decades) due precisely to the power of the internet. This will eventually lead to re-opening (completely uncensored) before the end of the decade.


  1. Before I get into the two core points that Scott talks about, I have a question:

    What's the deal with Hong Kong?

    So Google can move its search service to its servers on Hong Kong, and that magically makes it okay? Even though Hong Kong is now China? And I understand that China still blocks the objectionable results via the Great Firewall, but dang... that seems like a difference of semantics (or .com extensions, to be exact) more than anything...

  2. You know, I never did answer my own question of whether freedom of speech is a cultural norm or an unassailable right? Although we tried really hard. Does that mean I outsmarted myself? Or that I'm not smart enough to keep up with myself?

  3. As for Google v. China, Google is in a significantly stronger position because it is a business that exists entirely online, not a country. The absolute worst that China can do to Google is prevent Google from doing business in China. China can't physical harm or shut down Google (you know, without bombing Mountain View and declaring war on the US).

    That puts the burden on China to respond to whatever Google decides (and then Google can choose how and if to respond to China's response).

    Google can simply declare it will not censor anything, meaning China will probably not allow them to do business in China. Google can take a passive-aggressive role, basically saying "Ok, we'll do what you want." then replying "Oops" every time the Chinese government realizes that Google isn't actually censoring anything. Or they can simply say that they are in business to make money and agreeing to the Chinese government's wishes helps their shareholders.

    I'm not really concerned about Google moving forward. With or without China, they will be one of the stronger tech companies over the next couple decades.

  4. Hong Kong represents the whole "1 China, 2 Systems" deal.

    The issue isn't about what people in China can see, as what Google can 'host' in China. is hosted on servers in China - servers that the Chinese government can control w/out violating any laws, etc. (as far as I can tell). is hosted on servers in Hong Kong - servers that fall under the Hong Kong government, which fall outside the realm of Chinese law.

  5. Scott, then I think Aaron's point is a fair one - if Google is accessible on the internet no matter where it's hosted, don't they ultimately sit in the strongest position? Who cares if their hosting is on Chinese servers?

  6. Ok, let's say Google refuses to censor and is not doing business in China. Who takes over the search functions in China?

    The two most likely answers that come to mind are Bing (or for the sake of argument, any other multinational corporate search engine) or a new search engine created by a Chinese company. For them to be doing business in China, they must be censoring on behalf of the Chinese government.

    It would seem that if Bing agreed to censor so that it could do business in China after Google refused to censor, this would probably help gain Bing a large market share in China, but they would lose even more throughout the rest of the world in the ensuing public relations fiasco. For a Chinese company, they also would suffer around the world and probably not develop any strong business outside of China...which seems to counter China's goal of growing as a world economic power.

    Although if one of these companies actually proves itself (in the eyes of the public/consumers) to be superior to Google, than it is always possible they can censor in China and no one else will really care. Everyone else will just use whatever provides better searches.

  7. Baidu already dominates the China search scene, and they are highly proactive in self-censoring their Chinese site. I expect this situation to be the norm moving forward (not sure how quickly Google got to their 14.1% share in December, 2009).

    I'm curious as to what sort of response you expect from China in the coming months. It's not as if they'll be hurting from Google leaving, but many outside influences (exchange rates, Tibet, etc.) appear to slowly be pushing downward on their current position.