Google's Doublespeak on China

Includes: DIS, GOOG
by: Andy Beal

When Google announced that it would no longer play nicely with China, some suggested that this was a just a ploy to pull out of a country that it was struggling to dominate.

Of course, Google’s official stance was that it was just too much of a compromise to operate any business in China:

We have decided we are no longer willing to continue censoring our results on, 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, and potentially our offices in China.

Except maybe, for one that’s already successful…

A consortium led by Walt Disney Co. (NYSE:DIS) is in advanced talks to buy into China’s largest in-bus digital media and advertising company…Google was expected to take only a small stake in the Bus Online deal, while Disney aimed to take the greater part, said the sources, adding that no agreement had been signed yet.

Wow, Google! That stance against China lasted all of four weeks!

Here we were thinking that you were putting your foot down so that other U.S. companies might be able to get behind your efforts to stop censorship in China, when all along you were looking for a back door into the country.

Buying a stake in a successful Chinese company kind of gives credibility to the suggestion that you only backed out of China, because you weren’t able to compete. After all, if you were on such moral high-ground, you wouldn’t be buying into a company that already plays nicely with the Chinese government.

Would you?