Google leaving China?

Just to capture one of those defining moments in the whole complex mix-mash of big business, political correctness and respect (or lack of) for another nation’s value system, culture and sovereignty being played out by Google’s decision to leave China.

Google’s Threat Echoed Everywhere, Except China
January 14, 2010, The New York Times Company
By ANDREW JACOBS, MIGUEL HELFT and JOHN MARKOFF

BEIJING — Google’s declaration that it would stop cooperating with Chinese Internet censorship and consider shutting down its operations in the country ricocheted around the world Wednesday. But in China itself, the news was heavily censored.

Some big Chinese news portals initially carried a short dispatch on Google’s announcement, but that account soon tumbled from the headlines, and later reports omitted Google’s references to “free speech” and “surveillance.”

The only government response came later in the day from Xinhua, the official news agency, which ran a brief item quoting an anonymous official who was “seeking more information on Google’s statement that it could quit China.”

Google linked its decision to sophisticated cyberattacks on its computer systems that it suspected originated in China and that were aimed, at least in part, at the Gmail accounts of Chinese human rights activists.

In a statement, the United States secretary of state, Hillary Rodham Clinton, expressed “serious concerns” about the infiltration of Google.

“We look to the Chinese government for an explanation,” Mrs. Clinton said.

Outside the company’s gleaming offices in Beijing, a trickle of young people laid floral bouquets and notes at the multicolored sign bearing the Google logo. As daylight faded, two 18-year-old law students approached with a bottle of rice liquor and lit two candles. One of the students said that she wanted to make a public gesture of support for Google, which steadily has lost market share to Baidu, a Chinese-run company that has close ties with the government.

“The government should give people the right to see what they want online,” said the woman, Bing, who withheld her full name for fear that it might cause her problems at school. “The government can’t always tell lies to the people.”

Since arriving in 2006 under an arrangement with the government that purged its Chinese search results of banned topics, Google has come under fire for abetting a system that increasingly restricts what can be read online.

Google said the attacks took place last week and were directed at about 34 companies or entities, most of them in Silicon Valley in California, according to people with knowledge of Google’s investigation. The attackers may have penetrated elaborate computer security systems and obtained crucial corporate data and software source codes, though Google said it did not itself suffer losses of that kind.

While the scope of the hacking and the motivations and identities of the hackers remained uncertain, Google’s response amounted to an unambiguous repudiation of its five-year courtship of the Chinese market, which most major multinational companies consider crucial to growth. It is also likely to enrage the Chinese authorities, who deny that they censor the Internet and are accustomed to having major foreign companies adapt their practices to Chinese norms.

On Wednesday afternoon, the software maker Adobe Systems, announced that it, too, had endured a cyberattack. While it did not provide details about the assault, which took place earlier this month, the company said was investigating.

If news of Google’s threat to quit China was largely muffled, there was some back-and-forth on message boards and a torrent of Twitter commentary — accessible only to those able to circumvent the Great Firewall.

“It’s not Google that’s withdrawing from China, it’s China that’s withdrawing from the world,” read one message.

While many comments mourned the prospect of Google’s departure, others, including Rao Jin, the founder of the Web forum Anti-CNN.com, expressed suspicion over the announcement.

Mr. Rao, known for defending China’s stances on issues like Tibet and Xinjiang against Western media criticism, said he thought Google made its decision under pressure from Mrs. Clinton, who met with Google’s chief executive last week as part of an effort to promote Internet freedom around the world.

“I think Google’s departure from Chinese market would be a big loss to Google, though not as big a loss to China because Baidu and other search engines are still rising,” Mr. Rao said in an interview. “Any company in China has to abide by Chinese rules, even though there are some times when the rules may not be not so reasonable.”

Hecaitou, a prominent blogger based in Beijing, also applauded the company’s announcement, although for different reasons. The possibility of Google leaving China, he said, would send a message to Chinese leaders intent on imposing greater restrictions online. Or at least he hoped it would.

“In the short term, the Internet environment will be very cold,” he said. “But for the government to close the door and revert to 30 years ago is hard to imagine. If they want to go forward on the information highway, they’ll have to listen to others.”

If Google does leave, it would be an unusual rebuke of China by one of the largest and most admired technology companies, which had for years coveted the country’s 300 million Web users. Google said it would try to negotiate a new arrangement to provide uncensored results on its search site, google.cn. But that is highly unlikely in a country that has the most sweeping Web filtering system in the world. Google said it would otherwise cease to run google.cn and would consider shutting its offices in China, where it employs about 700 people, many of them well-paid software engineers, and has an estimated $300 million a year in revenue.

Google executives would not discuss in detail their reasons for overturning their China strategy. But despite a costly investment, the company has a much smaller share of the search market here than it does in other major markets, commanding about one in three searches by Chinese.

Google executives have privately fretted that the decision to censor the search results on google.cn, to filter out topics banned by Chinese censors, was out of sync with the company’s motto, “Don’t be evil.”

“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,” David Drummond, senior vice president for corporate development and the chief legal officer, said in a statement.

Wenqi Gao, a spokesman for the Chinese Consulate in New York, said he did not see any problems with google.cn. “I want to reaffirm that China is committed to protecting the legitimate rights and interests of foreign companies in our country,” he said in a phone interview.

In China, search requests that include words like “Tiananmen Square massacre” or “Dalai Lama” come up blank. In recent months, the government has also blocked YouTube, Google’s video-sharing service.

While Google’s business in China is small, analysts say that the country could soon become one of the most lucrative Internet and mobile markets, and a withdrawal would significantly reduce Google’s long-term growth.

“The consequences of not playing the China market could be very big for any company, but particularly for an Internet company that makes its money from advertising,” said David B. Yoffie, a Harvard Business School professor.

Mr. Yoffie said advertising played an even bigger role in the Internet in China than it did in the United States. At the time of its arrival, Google said that it believed that the benefits of its presence in China outweighed the downside of being forced to censor some search results, as it would provide more information and openness to Chinese citizens. The company, however, has repeatedly said that it would monitor restrictions in China.

Google’s announcement Tuesday drew praise from free speech and human rights advocates, many of whom had criticized the company over its decision to enter the Chinese market.

Rebecca MacKinnon, a fellow at the Open Society Institute and an expert on the Chinese Internet, said that Google had endured repeated harassment in recent months and that by having operations in China it potentially risked the security of its users in China. She said many Chinese dissidents used Gmail because its servers are hosted overseas and that it offered extra encryption.

“Unless they turn themselves into a Chinese company, Google could not win,” she said. “The company has clearly put its foot down and said enough is enough.”

In the past year, Google has been increasingly constricted by the Chinese government. In June, after briefly blocking access nationwide to its main search engine and other services like Gmail, the government forced the company to disable a function that lets the search engine suggest terms. At the time, the government said it was simply seeking to remove pornographic material from the search engine results.

Some Google executives suggested then that the campaign was a concerted effort to stain the company’s image. Since its entry into China, the company has steadily lost market share to Baidu.

Andrew Jacobs reported from Beijing, and Miguel Helft and John Markoff from San Francisco. David Barboza contributed reporting from Shanghai, Jonathan Ansfield from Beijing, and Bettina Wassener from Hong Kong.

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