Google Boasts Its Backbone by Saying 'No' to China

Mar.23.10 | About: Alphabet Inc. (GOOG)

I heard about this in a few podcasts recently and knew it was bound to happen sooner or later – Google (GOOG) finally acted in alignment with its typical image (a fearless, untamed titan) and resisted China’s attempts to continue censoring its search results.

Part of Google’s initial entry into the Chinese market was conditional on censorship of certain internet material under the Chinese government’s instructions. However, with recent considerable hacker attacks from China on various websites to stop censorship, largely on Google, the titan ultimately blamed the Chinese authorities for censorship in the first place.

The Chinese authorities obviously like to keep a tight hold of the content its citizens are exposed to. Smells a little like propaganda activity to most people. The Chinese authorities promote the internet for education and business, but keep a tight grip against obvious material such as porn, but interestingly also human rights and pro-democracy material that can expose its citizens to politically sensitive information… and maybe open them to new thoughts. More importantly, Google was on the righteous side of the battle and supported many human rights activists in China whose G-Mail accounts were part of the hackings.

Speaking of propaganda, interestingly, several Chinese newspapers actually counter-accused Google of having its own political agenda and claimed that foreign firms operating in China must abide Chinese law. It’s true – it’s never really clear what Google is up to. It dabbles around in almost every field in business, as this interesting video shows.

But, as far as this story goes, Google boasted the right part of its backbone. Censorship is as outdated as Marxism. The Chinese government will be able to contain the force of the country for only so long, and eventually (although possibly long), like every country, its boarders will open to the rest of the world. I’m not the only one that feels this way. Much support has been heard from the human rights activists whose accounts were hacked, and after Google announced its plea to fight censorship, some Chinese populace placed flowers outside their office in Beijing. Sounds like a plea for freedom to me.

It’s been said Google’s potential revenue in China is $500-600M, or about 2% – 2.5% of its 2009 revenue. In terms of monetary losses, it will be a small step if Google fully backs out of China, but it could turn out to be a big step for the mankind of China and their freedom.

Disclosure: No positions