An analysis of Google's dilemma

By Wu Feng
0 CommentsPrint E-mail, January 27, 2010
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Thus it's clear that Google's pull-out threat is simply a psychological tactic. Google choosing to declare the attacks hours after Baidu came under cyber attack is nothing else but its strategy to win some bargaining chips in future negotiations. This is why David Drummond only posted a blog article instead of issuing an official statement. This is also why Drummond said in the blog post that "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."

Common sense economics tell us that the ultimate goal of capital operation is to pursue the maximal interests (not just maximal profit). As a public listed company, Google doesn't make an exception. China is a huge market to the world and the internet industry. And as a company that seeks maximal interests, Google knows this. Otherwise, it wouldn't have poached Kaifu-Lee from Microsoft to run its China business at the cost of an expensive lawsuit in 2005. Therefore I think Google is very unlikely to quit the Chinese market.

So why did Google announce a possible pull-out? In order to find the real reason, we need to look beneath the surface. Besides the intention to get a looser operating environment for itself, Google is playing the role of a chess piece of the US government. I have always held the view that all the remarks and moves made by either the US government or its mouthpieces (US multinationals) about China are subject to the country's overall strategic goal to contain a rising China. The Google incident is no exception. A lot of the US multinationals act like a spoiled child of the US government. Whenever they can't get what they want, they will cry, then make a scene and eventually turn to the "mother" for support. Google is now at the stage of crying and making a scene. If it can't achieve its goal, it won't be long before Google drags the US government to a face-to-face with China.

In fact, on January 6, 2010, the US magazine Foreign Policy published an article titled "Twitter vs. Terror", which called for the US State Department to use new network technology to lead the global fight for freedom. The next day, the US Secretary of State Hilary Clinton invited some of the major players in the communications technology field to dinner at the State Department. Google CEO Eric Schmidt was among the guests. This may be the reason why Hilary was able to make a prompt response after Google announced the possible pull-out. Furthermore, the US State Department would roll out a new technology policy about internet freedom within the week that followed, which aims to help citizens of other countries gain access to uncensored Internet resources

Therefore it's obvious that Google won't step out of the Chinese market. And even if it fails to succeed in its scheme and really pulls out, we don't need to make a big deal about it. Google is out, but eventually Boogle, Toogle or some other search engine will start operating in China. We welcome companies from all over the world to operate in China in accordance with the law. But we are opposed to any company that attempts to coerce China.

The author is with the State Information Center.

(This post was translated by Yan Pei.)


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