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Google’s New Approach: Say No to China

Google’s announcement of its new China approach is the biggest tech news today, there are tons of comments and analysis on news, blogs and tweets already. I currently don’t have much more to add to the discussion. I just pick up some posts I read and share with you.

Google’s statement is very controversial, some people believe that it is because of the lose of business in China. Sarah Lacy of Techcunch think “I’m not saying human rights didn’t play into the decision, but this was as much about business”, and ” Google has clearly decided doing business in China isn’t worth it, and are turning what would be a negative into a marketing positive for its business in the rest of the world.” Sun Yunfeng, the Chief Product Designer of Baidu, also questionned Google’s sincerity in his personal blog, “If Google gain 80% search engine market share in China, will Google’s executives announce do no evil and quit China”? (The original post has been deleted from his blog.)

Obviously, Google doesn’t do well in China market, and revenue from China is immaterial, PaidContent pointed out that the estimated Google China’s $600 million revenue in this year “only represents just over two percent of the $26 billion in revenue that most analysts expect Google to post this year.” But it still keeps about 30% market share in this high potential Internet market. Leaving China in this way, without saving face to China’s government is not an easy decision to make.

Robert Scoble quoted, a Google Spokesperson “This is not about market share. While our revenues from China are really immaterial, we did just have our best ever quarter [in China].” Scoble also thought “China is a HUGE market”, “Google has EVERY INCENTIVE to kiss Chinese ass. That’s why this move today impressed me so much….It doesn’t matter to me that Google played footsie up until today, either. They were the first to stop playing footsie and THAT deserves a HUGE round of applause”.

It is not the first time for Google to think leaving China. Keso, the most famous IT blogger in China, said, according to his sources, Google had planned to withdraw from China in the year before last year, but Kaifu Lee sought help from Gary Locke to solve this problem. You should read Scoble’s second post to feel the push and pull of China market.

“As an American I saw two opposite poles [of China]: one of unending opportunity and one of unending frustration of dealing with the government…..I both disagree with [Sarah's article] and agree with it. Why? Because I’m feeling the push and pull of China. Is Google doing this because of business or because of ethics? Probably a little bit of both. Or, maybe, just sheer frustration from the push and the pull of China.”

You should also readJames Fallows’ post, “It is a significant development. Significant for Google; and while only marginally significant for developments inside China potentially very significant for China’s relations with the rest of the world.”

Jack Ma, CEO of Alibaba commented that a company will encounter many difficulties when operating in any country. It is easy to leave China, but giving up is the biggest failure for Google. But Xie Wen, a prominent internet commentator, saidhe admires Google, and “China’s Internet companies should not take pleasure in other’s misfortunes, today’s Google China may be your tomorrow”, and “China’s Internet will enter into the Age of Stone”.

You can also find the translations of Chinese Tweets on it, “It’s not Google that’s withdrawing from China, it’s China that’s withdrawing from the world”.

Kaifu Lee responded on his Twitter, “A captain would never run away from his duty, if he knew the ship was sinking”.

It seems the best predictor is Robin Li, in about five years ago he said “we will not see Google in five years”, though he will not know Google will leave in this way.

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  3. CWR Roundup: Netease, Alibaba Software, Tudou Funding and Google

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Post tags: Google, Google-China

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