Google vs. China — Who's Got the Most To Lose?

Barence writes "Google looks set to pull out of China, but who will suffer most? The search engine or China? At last week's South by Southwest conference, Kaiser Kuo, a former director of digital strategy for the Ogilvy & Mather advertising agency in China, gave an illuminating talk that examined the history of Google and other Western internet firms in China, their relationship with the Chinese Communist Party (CCP), and the likely outcomes of the current stalemate. Kuo explained that Google had earned the respect of the tech-savvy urban elite by protecting users, making censorship clear and by protecting its employees in China. That means Google is walking away from a 35% market share, which contains a far wealthier demographic than local provider Baidu. The Government, meanwhile, which has been very pro-competition, is about to hand a complete monopoly to Baidu, harm its international standing and the development of net technologies in the country. Is it a lose-lose situation?"

Comments

Breaking news!

[Zocalo]

Not even a link to a story yet, but the ticker on the BBC News home page is reporting that Google has announced that it has stopped censoring its search engine in China. Since China has already made her position clear on this eventuality I suppose this must mean that Google believes that it might as well be hanged for a wolf, than a lamb.

I'm nipping out for some popcorn; the next couple of days are going to be really interesting...

Re:Breaking news!

[phantomfive]

It is a brilliant move that takes advantage of Hong Kong not having speech restrictions, yet also being a part of China. They are redirecting all their traffic to the google.com.hk website.

The great thing is that China has based their entire argument on the fact that 'Google must obey the law,' and if they don't, they are not upholding the harmony of the country. Now Google has found a solution that is 100% legal. They are drawing attention to the fact that Hong Kong doesn't need censorship, and yet they are still able to maintain 'harmony'. The government is going to have to come up with a new argument for why they should censor Google's search engine. It will be interesting to see what they do.

Re:Google

[Ephemeriis]

Google has the most to lose because they are a company and China is a country.

Google will make its profit, but not as much as if it would have if it stayed in China.

Of course Google also gets to look like the good guy... Tried to stand up for freedom and was smacked down by the mean ol' Chinese government... May actually get them some new customers that they might not have had before. At the very least all this press is good advertising.

You're probably right... They're losing access to a huge market... But it's still possible that Google will wind up doing pretty well after all this. Sure, they'll lose some income... But how much were they spending (not just in money) to keep things up and running in China? Obviously Google thinks the cost outweighs the benefit.

China will make itself whatever its government wants it to become where Google is around or not.

You seem to think that a government can miraculously transform itself into anything it wants, and automatically be successful. That is not true.

Sure, the Chinese government is pretty damn stable. It is unlikely to topple because of this Google thing. And they'll release plenty of propaganda that will likely make them look even better in the eyes of the Chinese public...

But this has to hurt their international image. They're so repressive that Google couldn't even do business with them. I'm sure plenty of other companies will think twice before opening offices in China.

There are probably plenty of citizens who've gotten used to Google, and will feel its absence as well. Not to mention the folks who were employed by Google.

I don't honestly believe that any of that will amount to a whole hell of a lot... Google's just a search engine, I doubt if they'll have that much of an impact... But there will be an impact. Both within China and without.