Google's China Situation

| About: Alphabet Inc. (GOOG)

I am astounded and delighted at the news that Google (NASDAQ:GOOG) is no longer comfortable censoring search results at the call of the Chinese government and is threatening to pull out of the market. Google said it discovered cyberattacks and surveillance aimed at cracking the mail accounts of Chinese supporters of human rights. Said Google exec David Drummond on the company blog:

These attacks and the surveillance they have uncovered–combined with the attempts over the past year to further limit free speech on the web–have led us to conclude that we should review the feasibility of our business operations in China. We have decided we are no longer willing to continue censoring our results on Google.cn, and 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. We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.

I know some will say that Google wasn’t doing that well in China anyway (it controls 31% of the market); they’ll ascribe cynical motives. But I say: Name one other company that finally said “enough!” and put ethic, morals and company standards over its lust for the Chinese market. Not Yahoo (NASDAQ:YHOO). Not Cisco (NASDAQ:CSCO). Not Nokia (NYSE:NOK). Not Siemens (SI). Not The New York Times Company (NYSE:NYT). Google has.

Here’s what I said in What Would Google Do? about China:

Google has censored search results in China, arguing that it is better to bring a hampered internet there than no internet at all. I don’t agree and believe that Google has more power than it knows to pressure countries around the world to respect openness and free speech. Google, like Yahoo, has handed over information to governments—Google in India, Yahoo in China—that led to users being arrested simply for what they said. As an American and a First Amendment absolutist, I’d call that evil.

Here’s what I said in a talk at Google’s offices in Washington.

Note that even Google’s cofounder, Sergey Brin, has waffled if not agonized over the company’s China policy.

I can well be accused of being a Google fanboy; I wrote the book. But I have been consistent in my criticism of Google’s actions in China. And so now I have no choice but to become even more of a fanboy. I applaud Google for finally standing up to the Chinese dictatorship and for free speech.

Will the Chinese people revolt at losing Google? We can only hope. Will other companies now have to hesitate before doing the dictators’ bidding? We can only hope. Will Google be punished by Wall Street? It probably will. But as I’ve argued, we should hope that Google’s pledge, Don’t be evil, will one day be chiseled over the doors of Wall Street.

Google has thrown the gauntlet down in favor of freedom. What Should Google Do? This is what it should do.

- Said Jonathan Zittrain of Harvard’s Berkman Center: “In a world in which we are so used to public relations massaging of messages, this stands out as a direct declaration. It’s amazing.”

- Says Reuters: “The world’s dominant search firm may be hoping other search and e-mail leaders, both global and domestic, will rally around it in calling for China to lighten a heavy-handed approach to the Internet that includes frequent censorship and allegations of government-backed hacking.”

- Zeit Online calls Google a quasi-state that is willing to stand up to China where the U.S. and Germany are not. But it also warns that Google’s interests are not what they seem. (In German.)