Under Its Threat, Google Would Abandon a Lucrative Market

NY Times:

Under Its Threat, Google Would Abandon a Lucrative Market

SAN FRANCISCO — Google threatened on Tuesday to pull out of China after it learned of immense security attacks and attempts to gain access to the Gmail accounts of Chinese dissidents and human rights activists.

In addition, the 20 or so other companies that may also have been attacked, many of them American, are now in the difficult position of deciding whether to follow Google, whose business in China is small. While it has several hundred employees in China, Google lags far behind the home-grown search engine [Baidu]("http://topics.nytimes.com/top/news/business/companies/baiducom-inc/index.html?inline=nyt-org"). 

But Google and other companies like Microsoft of Cisco have plenty to lose if they were to abandon what is rapidly becoming one of the most lucrative technology markets.

Duncan Clark, chairman of BDA, a consulting firm in Beijing that advises major telecommunications and technology companies, said many other multinational companies faced serious challenges in China. As nationalism and protectionism builds in China, he said, many technology companies have scaled back their ambitions there, particularly regarding content.
He cited recent crackdowns on Web sites and an attempt to force all PC makers to install software that censors the Internet.
“This has ramifications far beyond this case,” he said. “There have been a raft of decisions and unpredictability, a kind of unpleasantness about what’s happening here. There’s been this received wisdom that no one can afford not to be in China. But that is being questioned now.”

I stopped using Google when they cooperated with the Chinese government before on a similar issue. If they reject the restrictions being demanded by the Chinese and walk away I’d be happy to come back. Problem is, I’m the gnat and China is the herd of elephants. Still, there used to be a time when it was easier to choose between doing the right thing and doing the profitable thing.


This is big news. Not just for Baidu, which is having a field day at the moment, but for other corporations that have been chaffing at the People’s Republic’s restrictions. Maybe other American or multi-national companies will follow this precedent and pack up and leave?

This is big news in Chinese language news as well - I’ll see if I can’t find a good example later.

Apparently, besides making demands that search engines censor the searches, there are other problems when tech companies do business in China, such as having company technology stolen, servers hacked, and privacy violated.

Gotta admit. China scares the crud outta me.

Just when I was getting used to online banking and online shopping, I am now becoming worried that my information may end up in the hands of the Chinese bureaucrats or spies.

With so many Chinese overseas now, China may just find that trying to control information in the digital age is an impssible battle. they may just find it easier to control the floods of the Yellow River easier than the flood of information that the internet will provide more and more

I disagreed with Google’s choice to cooperate with China’s censorship policy but I can’t say that I blame them; it’s just business and it’s harmless. I will say that Google did a brave and noble thing by telling the Chinese government, after these incidents, that they will no longer comply with the censorship policy and will not allow their product to be used to commit human rights violations.

Does this tie in with China’s cyber attacks on the United States?

According to Google; yes. Google has stated that the cyber attack involved hacking the accounts of Chinese human rights activists.

And China has also been cyber-attacking the Pentagon.


[damage control by omission] [tch tch tch]

Well, according to some sources this has little to do with human rights and more to do with money. If it was someone acting on behalf of the chinese government to hack those gmail accounts then that would mean the chinese government has figured out google’s source code. That would be problematic since the source code is considered google’s “intellectual property” and a chinese competitor could use it to take on google in the chinese market.

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