While Chinese netizens laid wreaths outside the Google headquarters in Beijing yesterday, a short distance away the executives of Baidu, the biggest Chinese search engine, must have been thinking of popping champagne corks.
Google’s decision to pick a public fight with the censors is almost certain to cement Baidu’s control of the world’s fastest growing Internet market, in which dominance requires compliance.
While the move has won plaudits from freedom-of-expression groups, business-minded critics said Google had made a strategic error.
“This is the most stupid decision in their history,” Tang Jun (唐駿), a former president of Microsoft China, told Eastday.com. “Giving up China means giving up half of the world.”
But the binning of the “devil’s bargain,” accepted by many foreign firms in order to do business in China, is determined by a cost analysis taking account of brand value as well as profit.
In financial terms, Google.cn’s filtering of information on politically sensitive topics has not been well rewarded. While the Chinese Internet market has expanded to 338 million people, Google’s business in China has been undermined by clashes with the censors and an uneven playing field. “Guge” (谷歌), as the firm is known locally, has 12 percent to 17 percent of the queries, and 33 percent of the income in the Chinese search market. Baidu has almost all the rest.
While Google’s 800 staff could lose their jobs now, the impact on the firm’s global revenues will be small, perhaps 1 percent to 2 percent of the total. This has prompted cynicism over its motives behind the decision to champion free speech.
Rumors about the firm quitting China had been circulating since September, when Lee Kai-fu (李開復), a former chief executive, left to set up his own venture.
Several other leading US Internet companies, including eBay and Yahoo, have beaten a retreat or changed strategy in recent years after failing to challenge Chinese rivals. If Google is pushed out of this market now for adopting a confrontational stance, it could regain lost credibility overseas.
Kaiser Kuo, a consultant to Youku, a video-sharing Web site, said of Google’s position: “It looks like a smokescreen of sanctimony ... being done to draw the eye away from the ignominy of a humiliating retreat. But I suspect their motives are more earnest. Google may have a paltry market share compared to Baidu, but this is not a market to be sneezed at.”
In the long-term, analysts said, China’s domestic market would be a loser, too.
“If Google goes, Baidu will be the only giant in China’s search engine market. A monopolized market can’t be healthy,” said Cao Junbo (曹軍波), chief analyst at iResearch.
Google’s move also reflects badly on firms that do comply with the censors.
Hu Yong, a new-media academic, said: “Google’s market share is not very big, but their loss would definitely not be good for the Chinese market. It damages the image and credibility of the internet industry.”
Baidu declined to comment on the fate of its competitor but said it had no intention of following suit by challenging the censors.
“Baidu will always go along with Chinese laws,” a spokesman said.
Yahoo, Microsoft and Cisco accept that principle, but human rights groups said Google’s revelations on the hacking and its stand on censorship could set an example.
“This is a wake-up call to the international community about the real risks of doing business in China, especially in the information communications technology industry — an industry essential to the protection of freedom of expression and privacy rights,” said Sharon Hom, executive director of Human Rights in China.
US aerospace company Boeing Co has in recent years been involved in numerous safety incidents, including crashes of its 737 Max airliners, which have caused widespread concern about the company’s safety record. It has recently come to light that titanium jet engine parts used by Boeing and its European competitor Airbus SE were sold with falsified documentation. The source of the titanium used in these parts has been traced back to an unknown Chinese company. It is clear that China is trying to sneak questionable titanium materials into the supply chain and use any ensuing problems as an opportunity to
It’s not every month that the US Department of State sends two deputy assistant secretary-level officials to Taiwan, together. Its rarer still that such senior State Department policy officers, once on the ground in Taipei, make a point of huddling with fellow diplomats from “like-minded” NATO, ANZUS and Japanese governments to coordinate their multilateral Taiwan policies. The State Department issued a press release on June 22 admitting that the two American “representatives” had “hosted consultations in Taipei” with their counterparts from the “Taiwan Ministry of Foreign Affairs.” The consultations were blandly dubbed the “US-Taiwan Working Group on International Organizations.” The State
The Chinese Supreme People’s Court and other government agencies released new legal guidelines criminalizing “Taiwan independence diehard separatists.” While mostly symbolic — the People’s Republic of China (PRC) has never had jurisdiction over Taiwan — Tamkang University Graduate Institute of China Studies associate professor Chang Wu-ueh (張五岳), an expert on cross-strait relations, said: “They aim to explain domestically how they are countering ‘Taiwan independence,’ they aim to declare internationally their claimed jurisdiction over Taiwan and they aim to deter Taiwanese.” Analysts do not know for sure why Beijing is propagating these guidelines now. Under Chinese President Xi Jinping (習近平), deciphering the
Delegation-level visits between the two countries have become an integral part of transformed relations between India and the US. Therefore, the visit by a bipartisan group of seven US lawmakers, led by US House of Representatives Committee on Foreign Affairs Chairman Michael McCaul to India from June 16 to Thursday last week would have largely gone unnoticed in India and abroad. However, the US delegation’s four-day visit to India assumed huge importance this time, because of the meeting between the US lawmakers and the Dalai Lama. This in turn brings us to the focal question: How and to what extent