If Google.cn Will Soon Disappear, Should Google “Burn Its Boats” On The Way Out?

March 13 2010 by in Baidu, Censorship, Cyberwar, Google, Policy, Regulation, US-China |View Comments

The Financial Times reported Saturday that Google is “99.9 percent certain” that it will shut its China search engine at Google.cn. It has been eight weeks since Google said it would no longer censor search in China.

The Chinese government has handled this much better than expected given, from their perspective, Google’s very public provocation. They did not do anything rash, like preemptively shutting Google.cn, possibly on the pretense of porn on Google.cn (which amazingly is still there if you look hard enough). Instead, they reiterated that all companies in China need to obey Chinese law and waited for Google to make a move. I have no specific knowledge of Google’s attempts to negotiate, though “negotiate” is probably not what the Chinese government was doing when it came to a discussion about providing unfiltered search results.

If Google, as the FT reports, has a plan for the closure of Google.cn, what is in it? Will Google go quietly, shutting the site while trying hard to retain other apects of their $300-350m/yr business, like a sales network for ads on Google.com and Android handset and developer relationships? Wouldn’t that open them to charges of partial “appeasement” and “still doing evil”? Or will Google go out in a blaze of glory (Chinese might use the proverb 破釜沉舟-”cut off all means of retreat; burn one’s boats”), taking the filters off and forcing the government to shut Google.cn?

As I understand it, Google has always been quite concerned about the safety of the legal representative (faren 法人) and shareholders of the PRC domestic firm that holds its key Internet operating licenses in China, and so those people (I think 4 in total) are outside the PRC as much as possible, it not permanently. If they were in the country and Google decided to try to run Google.cn without filters, those people could easily be arrested. But if they are not here, it is unclear who in the company would actually be in legal jeopardy according to Chinese law. (The government has probably figured this out, so expect a new regulation requiring that faren and shareholders be present in the PRC.)

It could be quite viscerally satisfying to see Google burn its bridges by forcing the government to take action against an unfiltered Google.cn and then publicly disclosing all sorts of information and issues that it had to deal with over the last few years. They probably will not do that, as they likely hope that they can salvage some vestiges of a business in China and a “working relationship” with the Chinese government.

The closure of Google.cn will damage China, from discrediting its soft power campaign to rattling foreign businesses to upsetting a key constituency of educated and white-collar Chinese. Google is naive if they think they can close or force the closure of Google.cn and still retain any sort of a positive relationship with the Chinese government.

From the perspective of its global business, Google may now have more to gain by “burning its boats” in China.

Please tell me what you think in the comments. You can also follow my much more frequent updates on Twitter @niubi.

See Related Posts:

What IP Was Stolen From Google, And Where Does Morality Come Into The Picture?

Will Secretary Clinton’s Speech On Internet Freedom Kill Google’s Hope For A Compromise in China?

Google, China and “Digital Combat”

“网瘾战争 War of Internet Addiction” — Are World of Warcraft’s Travails In China Much More Interesting Than Google’s?

Will Google, Facebook and Twitter Please Join as Sponsors of the USA Pavilion at the Shanghai World Expo 2010?

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  • colonel_bleep
    The Google/China relationship has been oil/water since Goog's formal entrance 4 years ago, so I don't think arrogance is at play here. IF the company's proprietary operations had been hacked or compromised by the Chinese gov't & individual e-mails stolen than I can see why Brin blew his stack. It may not have been the "right" approach but it is what it is. If China is not Google's cup of tea then there is no reason to attend that tea party. Who needs that gnawing, frustrating distraction when there are so many more fun - profitable things to work on.

    In terms of money, a lot of folks are thinking Google is throwing away the whole world, as if 300 million is going to turn into 300 billion in a year. It's bizarre. What if the easy work of internet access in China has already been accomplished? Will the next 30% / 400 million Chinese be as simple to get up and running as the first? Over half the population is rural. The Chinese gov't plans to alter that demographic from 720 million to 400 million...but over a 40 year time frame. In the meanwhile, how expensive is it to get internet service to the hinterlands? If even possible. Maybe max penetration is only a double from here, which would get Goog revs up to 600 mill (I'm just throwing out numbers here)? Is it worth the aggravation, partaking in something that irks you to hell for the sake of a fraction of your revenues.

    While Goog's China revenues went from 0 to 600 mill 2006-'09, their US & worldwide revs jumped from 7 bill to 26 billion! During that time, despite announcing entry into China & the quad increase in revs & earnings the stock has gone up all of 100 pts, about 17% from 475 to 565.

    For Goog, it's time to move on to TV. They'll probably make more on that gamble in 5 years than 50 years in China.
  • Guest2
    Google PR team is pretty good at what it does, which is to hype and politicize this issue as much as it could. Media outlets such as this one just love to chew this crap up.

    If google is going to make a political point by shutting down its operations it would of done so already. MS is lined up already for the Chinese market. Most Chinese won't miss it. Those who do typically know enough English to use regular google hosted elsewhere. Without Chinese people actually using google, google's search engine for China will deteriorate. In the future when people search for anything practical on China they will probably use an alternative.

    Everyone will be happy. Google can pretend to be not evil again; Chinese government can worry less about political instability caused by Google searches; Microsoft and other players see a new business opportunity in a hot market. What is Google waiting for, just do what it has to do already.
  • They will still have Taiwan to work on their Chinese search algorithms.
  • Interesting point "Without Chinese people actually using google, google's search engine for China will deteriorate". I assume you mean without all the search data Google's algorithm for the Chinese web will "atrophy"?

    I agree about that Google's PR team good at what it does. I wish you had read my other post on Google China; I am quite clear that I am quite skeptical of what they have done, as you are. BTW, this is just a blog, not a media outlet, and with zero media affiliations of any kind.
  • guest
    Dude， 法人is not 人(person)，法人代表 is a person. You obviously know littel about Chinese law.
  • Thanks for your comment, sorry you seem to have such personal animus. I have actually been involved in the creation of close to a dozen companies in China, both WOFEs and 100% domestic firms. Technically you are correct, and if you were drafting a contract you would make that distinction. However, in normal conversation 法人代表 tends to get truncated to 法人. This is a blog, not a contract, and to people who understand these issues the meaning is very clear.

    Thanks again for reading.
  • Ah, I forgot to add: should Google "burn the boats?" In my opinion absolutely not. I don't think burning the boats is ever a good solution in business, and I don't think it would report so much benefit to G in the West. People would accuse Google of hypocrisy after 4 years of helping the Chinese to censor, and G might come to be seen as the executive arm of the US administration on the net.

    Quite apart from business considerations, I also think burning the boats is bad from a human perspective. It would only show an arrogance and a righteousness that is completely unwarranted in Google's leaders. Or do they seriously believe that the US is so much better than China and it doesn't ever commit crimes? Right.

    PS. It is impossible to open your disqus system from China, I only manage now that I have connected the VPN.
  • Thanks for the comments. There is a lot of downside for Google for burning the boats, and I highly doubt they will do it. But I think it is fantasy for them to believe that, after basically sticking their finger in the Chinese government's eye and bringing them an internal and external PR mess, they can still maintain a positive relationship with the government for the other businesses.

    I hear you about disqus. but so far the best spam killer by far I have found. What do you use?
  • For the spam, Akismet, without any doubt. It works just perfect for me. Very few spammers get past the filter.

    Regarding Google: Have you seen the article below? It is not China related, but it speaks of the kind of arrogance in Google's leadership that I refer to. IMO G is a great company, but it has a very short history, and the massive success of their search engine might be giving a distorted vision of reality to its leaders.

    Another Chinese chengyu: 不要迷恋G，G只不过是个公司 :)

    Ths link is: http://gawker.com/5491756/six-delusions-of-goog...
  • Yes, it is an interesting article. Given Google's success and power it is probably impossible not to become arrogant.

    They forget a rule that most Chinese businesses understand very well: when it comes to how the Chinese government views the world, everyone at then end of the day is still a "peasant".
  • Interesting perspective about the 法人. But I don't see it so clear, this solution of keeping them outside China. I mean, I am assuming those people are Chinese and they have their lives/families in China. Not everyone is a hero like Liu Xiaobo, are those guys going to be just fine with abandoning their country, and knowing they will be arrested the minute they set a foot back in their home town? I don't know many people who would do that for their company, much less 4 Chinese shareholders who probably have property and other things to lose if they abandon Beijing.
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