I do not like the way it has been done, but it sure takes some guts for a CEO to defy the World order, whatever the company’s IPO said. My own site has been victim of censorship, and I was quick to blame Google when they helped censor initiatives like Charter 08,  so it is only fair that I praise them now. Search Engine Manipulation (SEM) is the worst kind of censorship, because it leads the user to believe that the information contained in search results is a fair sample of the World’s views. It was very difficult for Google to justify that behaviour, and it is good news that they stop being part of it. Bravo.

And yet, there are important reasons why Google has been putting up with the Chinese system for 4 years, and as far as I can see, all of those reasons are still there today. By leaving China on a whim, Google sends the message that all that work was just a big mistake. Worse still, by slamming the door on the way out, Google creates trouble for itself, for the Chinese netizens, and for the World internet community.

By any standard, Google’s statement last week is a disaster. It has all the sins that a company announcement can have, not only from the PR perspective, but also from plain common sense. It is insultingly self-righteous, it fails to provide a clear reason for the decision, and it does not offer evidence for any of the accusations. Worse still, it sends an ultimatum to the government of China, revealing a thirst of political power that is very disturbing in a corporation.

Brazen cartoon on China Daily (WSJ)

The primary colors in Google’s logo and its simple slogan “don’t be evil” suggest a world of fairy tales where Good and Evil are clearly defined, and one can live following the Google path, righteously pointing out to others that they are in the wrong. Life is unfortunately more complex, and only very simple people can believe that God is always on their side.

Intentions and Nature of Google

I liked yesterday’s article by Rebecca Mackinnon because it rejected the idiotic debate about the purity of motive of Google’s leaders. On the other hand, I found it a bit too optimistic regarding the role of Google and the World internet community today. 

Google is no more or less evil than most corporations. The difference is it has a developed a unique business model that requires large amounts of trust and goodwill, and it has done a great job of promoting it up to now. To the point that in the online community, it has managed to reverse the classic roles, turning the radical hacktivists into CEO-huggers.

But non-evilness is not what has taken Google so far. The secret of Google, its key asset is information. Google is cool because it is in the process of hoarding and classifying all the information of the World, and this allows it to earn money in a way that is not painful to the final user. Google today stands for great,  free inventions and open systems because its clever business model, impossible to replicate in other fields, allows it to earn money this way.

But Google today is still a very young company, and more vulnerable than most netizens imagine. It is extremely strong in brand and in goodwill, which is reflected in is market value. But this value is nothing more than a promise, and its actual revenues, extremely dependent on the Search engine business, are still far from the giants in the offline World.

Every internet company is always one click away from ruin, but this is especially true for a business based on search engine ad revenue. Facebook, Twitter, Windows, most information companies count on the network effect to force people to stay with them, Google just counts on a technological gap that is closing. For Google search, the competition is always at the reach of one finger, and until Google succeeds in establishing its network of cloud services, a large part of its value still relies on goodwill.

Google’s Mistake

As I said above, Google’s decision to stop collaborating with the censors is admirable, but to engage in brinkmanship with a country is a disastrous mistake. Google enters a new and risky game, with players far more powerful than itself, where it has more to lose than to win. If it doesn’t tone down its message very quickly, it risks being completely banned from China, which is a very different thing from just closing Google.cn.

First of all, this would mean that it abandons the activists that it supposedly cares about, and that Google.com, the only non-manipulated search engine popular in China, will most likely be blocked. Worse still, it means that Google of all companies, the one that is proposing to keep in storage all the data of our lives, admits to being defeated by the Chinese in the business of IP protection.

From the market perspective, it is even worse. The Chinese language might make up more than one third of the whole internet in this decade, and whatever Google’s share is today, disappearing from China will have immense consequences in the future online scene. Not only it increases the dangerous divide of the internets we already mentioned, but it effectively destroys any chance of Google becoming a truly universal company.

But for Google itself, there is one thing more dangerous than all that.

Non Evil vs Politics

The motto “don’t do evil” is negative, it suggests non alignment, passive resistance to the invaders, benevolence and pacifism. It would have been much better for Google to simply stop censoring some information, critical content like the Charter 08 and its imprisoned author, while trying to content the CCP by hiding boobs and ankles. They might have still been sent out of the country, but it would have been for a good cause, and the World would have been watching.

On the contrary, by openly challenging the government of China, the onus of proof lies now entirely on Google’s shoulders. And by letting itself be seen hand in hand with the US government, Google is taking sides in World politics. The neutral, non-aligned company that was meant to become the government of the internet suddenly becomes an American corporation. How will the non-American internet see this?

A company that speaks up against some evils will be expected to fight others as well, people will start asking Google to speak against certain American policies in the Middle East, or to leave the country if it is in disagreement with the Patriot Act.  The voice will turn that Google is at the service of the USA, and for a big part of the World, including many in the West, Google will forever be marked with the stink of politics.  It will still be a good company, certainly, like the CNN. But it will just not be the company anymore.

As it is today, the Chinese government is not particularly interested in seeing Google leave, so it will not push things further. If Google.cn manages to be sent out quietly and not make too big a mess of it, the situation may still end up favourably for them…

Please, Google, do not lend your name to a new American crusade. The offline World has had enough of imported freedom and democracy bombs, we don’t need the same on the internet. Democracy, like love,  has to come from the inside, it is achieved with patience and daily work, like you have been doing these four years. Stay at your post, keep working for China and for all of us, don’t let the internet be divided. And the online World will be yours.

In World politics time is measured in decades, and many will call the 00s the decade of China. It is just a simplification, these 10 years are nothing but part of a longer process started in 78, and probably still ongoing for another decade more. And yet, if we have to choose one event that marked the decade in World politics, like the end of the Cold War marked the 90s, the rise of China is the most reasonable choice. No other event is likely to be be more decisive in the history of the World.

In the first post of this Year End edition we proved that, within the general growing trend of the decade, 2008 was a peak for China’s presence in the World media, and 2009 has gone back to relatively normal levels. This peak cannot hide the general trend: that China is growing inexorably to become a World superpower and that it is already changing the power balance of humanity.

Measuring the Chinese decade

If we have to chose one single parameter to measure this rise, it is the economy that can give us the best clue. There is no point in going to the decimals when analyzing decade trends, so the calculation is simple: China has grown roughly 7% faster than Western countries in the last decade, and all seems to indicate that this will continue into the 10s.

The calculation* is straightforward:  1.07^10 = 2

At a rate of 7% differential a year, the size of China’s economy relative to the Western economies is doubling every decade. Today most estimates of GDP place China between 1/4 and 1/2 of the USA economy, depending if it is measured in nominal GDP or in PPP. This means that, if nothing else changes in the next decade, Chinese economy will be the biggest in the World anytime between 2020 and 2030.

The consequences of this calculation are enormous, and they are already operating today. That is because in politics we behave like in the stock market: decisions are made taking into account the foreseeable future rather than the present. China is already displacing the EU in World politics, even if it is a fraction of the European economy, even if it doesn’t want to be the protagonist. The media and the politicians are betting on the future value of China.

The Question of the Decade

Of course, nothing guarantees that the growth patterns of the 00s will continue in the 10s. There is one important school of thought that insists on the unsustainability of the Chinese system. They mention corruption, growing inequality, lack of civil rights and a civil society, repression of creativity and free market, the inability to build World class brands and a financial system in disarray, among other problems, to justify their prediction that sooner or later the Chinese economy is bound to crumble.

Those of us who live and work in China know that these problems are serious and very real, and that somewhere down the line there is bound to be a serious readjustment. And yet, the same predictions have been made regularly almost every year in the last three decades, and the collapse has not materialized.

The real question of this decade is When?

Will the Chinese economy stop growing before or after it has become a superpower as large as the USA? Will the Chinese seriously demand more rights and liberties before or after China has become a developed country? Will the economic and political readjustments be done progressively with the new generation of Chinese leaders, or will there be a dangerous explosion in this decade?

We don’t have the answers to this today, and you should not believe any China expert who claims to have them. All we can do is frame the question above, and watch out for early signs to answer it in the coming years.

There is however one statement we can make today. Looking at the World, it is obvious that many important players are already betting on the rise of China, and this view is gathering more support every year. As we have seen above, to the extent that the majority in the World believes in the superpower scenario, China is ALREADY a superpower. The political power comes years in advance of the GDP, and the new World order is already a fact today.

Photo: Eric Risberg

*This is an engineer’s calculation, the nightmare of any serious mathematician. And yet, most bridges we do are still standing, and when we speak of decade trends anything more accurate than this is a joke.