Well it took them four years but it seems Google has had enough, they are considering reviewing their business operations in China. A statement on their blog can be found here. So before we prepare ourselves for a standing ovation, lets ask a few questions:
Does Google help the Human Rights Cause by pulling out of China: Simple answer, NO. The Chinese government will continue its crackdown on the internet along with those it perceives as a national security threat. Google’s exit will not in any way hamper the govt efforts and if anything this move will do more harm than good. Google’s presence in China and its work ethos (Do No Evil etc.) exposes employees to the culture that promotes human ideas and respect for people. The proponents of Modernization theory (among others) understand the importance of ‘agents of change’ in the development of democracy.
Does Google help the Google Cause by pulling out of China: Simple answer, NO. Last time I checked Google was still trying to organize the world’s information, and it certainly will not help if it decides to pull out from a country which will replace the US in terms of internet usage and information output (remember I said information output not knowledge). On the products/services front, ignoring a country with more than a billion people makes very little economic sense (and not surprisingly little strategic sense as Google does not gain much…. or does it?).
Does Google help its Chinese and US competitors by pulling out of China: Another simple answer, Yes. Baidu is the current search leader in the country and will be more than glad to fill in the vacuum. The oldies bunch (Yahoo, Microsoft etc.) will view this move very pleasantly as well. Bing anyone?
Does Google help the Chinese government by pulling out of China: This one is a tricky answer and requires a deeper understanding of Chinese politics. One thing evident is the importance of control and sovereignty to the Chinese government. China in its dealing with other states on areas such as energy security does not interfere with local politics or place any political/democratic demands (unlike its western counterparts). This is the same approach that it expects from outsiders when dealing with the Mainland. The phenomenon of globalization and a global civil society has significant impacts on the International System, and technologies (especially those Google provides) are at the forefront of this evolution. It will be very interesting to see how states like China adapt to new paradigms. At the moment though, having control of the search market through local outfits helps further Chinese interests than dealing with foreign companies with “foreign agendas”.
So if on the face of it, the move makes little strategic sense, why would an almost $200 billion global company with a host of strategic advisers, analysts and investors (to keep happy) attempt to ‘increase the temperature‘ now?
The first and most obvious part of the answer may lie with Mr.Scoble. Goodwill generated by the western consumers (which includes me) goes a long way today and companies are increasingly realizing the powerful affects of the social networked movement. Now whether this is enough to precipitate a major strategic maneuver by Google is difficult to answer. Personally, I am far more interested in seeing how the Chinese living in China view this action from Google (assuming it does follow through). We in the west will more likely than not move on to other more interesting stories…
Another interesting but questionable hypothesis ponders whether part of Google’s frustration has something to do with its less than stellar share size in the Chinese search engine market. The pie chart below indicates Google’s market share in Q2 of the Chinese search engine market in 2009 ( a little lower than Q1).
Whatever the reasons are, I think Google’s recent actions are what we call in the political world “posturing“, meant to raise the temperature to ‘warm’ but never ‘boiling hot’. After all, unless this is part of a clever attempt to marginalize Google from China (and yes the Chinese are very proficient in this game), it makes little strategic or humanitarian sense for Google to close office and wind up its operations, infrastructure and investments in the People’s Republic of China. Either way we can rest assured that billions of dollars do offer one with access to the right sort of analysis and intelligence.
Update: Just read a very interesting Blog . Author doesn’t agree with me but he can back up his points in style!
– Danial Jameel www.twitter.com/danialj