What is going on with Google (2): consequencesWritten by Julen Madariaga on January 13th, 2010
Following the previous post about Google and China, here are my reflections regarding the foreseeable consequences of all this. First of all, an important clarification: I don’t think fighting against censorship is bad. Censorship in China is very real, it is a disgrace not only for activists but for most honest Chinese, and it only serves the purpose of self-preservation of the CCP.
Having said this, in the previous post I criticized Google for this decision because I think the form is wrong, and the method chosen for this fight is wrong, and more importantly: the Leader of this fight should not be a corporation, much less a Western corporation going solo into politics.
On the other hand, if it was a pure business calculation I think it is wrong as well, in the long term it does not make business sense, and the growing Chinese market is likely to live much longer than any goodwill earned for this.
The more I look at the message, the more it looks like a mistake, a young idealist Googler that has escaped the supervision of his boss. What authority does this blog really have to speak for the company? the message is legit, as commentators have proven below.
In any case, here are some consequences I foresee, again in fast bullet points:
- The way the message has been drafted, chances for Google.cn to remain are slim. It will be very difficult for Google to step back from this, the whole tech World is going nuts about it. On the other hand, it is even more difficult for the Chinese authorities: even if they were willing to accept Google’s conditions (which they are not) they could never allow a Western company to publicly force their policies. Unless there is some kind of recanting, Google.cn is doomed.
- The Chinese authorities can do more than forcing Google.cn out. If things go sour they are also very likely to GFW block* the whole Google.com, in which case the situation would be even worse than pre-Google.cn in 2006. Google could totally disappear from China and say goodbye to a fast growing 20% of the World’s internet users. This includes the phones and any other Google product.
- I maintain that the decision is BAD in business because consumers have very bad memories, and the goodwill gained in one day, however massive, does not last. How many companies go bust for accusations of child labor? In a few months nobody will remember this move, and Google will find itself down 20% potential market and with nothing in exchange.
- Baidu is going to go up even more, and some other Western opportunists as well. The search service of Baidu is demonstrably worse than Google, and the Chinese internet users will be the first victims of an impoverished service. The already noted Divide between China and the West will be further increased, and this can only be bad for the Chinese, and bad for Human Rights, and bad for the World.
- Regarding the bigger political picture, all this is unlikely to have any effect on American or Chinese policies unless there are many more Western companies that join Google. But no other company is going to join a crusade to bring goodwill to Google, and the move will just leave superficial scars in the CCPs internet reputation, which they will be able to heal in no time with some little doses of nationalist balm.
- Regarding the stock market, the media has noted that Google is down 1.77%, but that is not significant in a day when the whole Nasdaq was down 1.35%. Note that Baidu fell 3.51% after my yesterday’s post, and probably the impact on Google will be seen today when the market opens. I am quite happy that I got rid of my Bs yesterday to buy some Gs, and today I am getting rid of the Gs again to get back the Bs. This has to be a winner move!
*Note: Servers outside of China (google.com) get blocked by the GFW, servers within China get bullied by the Nanny. Two completely different processes with a similar result. More here.