International espionage and the human right to freedom of speech have brought Google Inc. to a crisis point in its business venture in China. A brief synopsis is that Google detected a “highly sophisticated” cyberattack on its system in mid-December, targeting political dissidents all over the world (not just Chinese freedom fighters) as well as other companies; they also claim the infiltration compromised some of their intellectual property. Although Google makes a point of stating that they have no proof that these cyberattacks are connected to the Chinese government, their response to the attacks implies that their level of trust with the People’s Republic of China (PRC) is subterranean. Google states,
These attacks and the surveillance they have uncovered–combined with the attempts over the past year to further limit free speech on the web–have led us to conclude that we should review the feasibility of our business operations in China. We have decided we are no longer willing to continue censoring our results on Google.cn…
If Google felt as though these attacks were not connected to the Chinese government, instead of challenging China’s laws of censorship, they’d probably be asking the Chinese government to enforce their laws against hacking. Not to mention the web-links from the blog post that announced their new “live free of die” mentality, titles included:
- A 10-month investigation of alleged Chinese cyber spying against Tibetan institutions
- “Targeting Chinese Dissident Groups Abroad” from the 2009 Report of the U.S.-China Economic and Security Review Commission
- “Capability of the People’s Republic of China to Conduct Cyber Warfare and Computer Network Exploitation”
Google couldn’t get much closer to saying, “It’s the Government!,” without saying it. And, a report was just published confirming that the attacks came from PRC.
But even with this incontrovertible evidence, companies have suffered through worse at the hands of their host government for the sake of profits. In fact, Google caught a ton of flack in 2006, when they announced they’d be opening up operations in China, stating they’d abide by the country’s censorship laws. Critics claimed the company was violating their informal corporate motto “don’t be evil” by accepting censorship for the market prospect of 360 million Chinese internet users.
And go after those 360 million users, they did! Google began with about 13% of market share in the 1Q2006, and grew to become the second largest search engine in the country, controlling about 35% of the market today. What I find most intriguing about this whole kerfuffle is how little it seems to have affected Google’s stock. They took a big hit (2.5%) the morning after their announcement, but earned it nearly all back by day’s end. And things went positive for them today. I’d normally expect investors would take the threat of an internet company losing access to one of the world’s largest and fastest growing populations of internet users as a bad thing.
However, to my delight, I think the world market saw Google’s move, as I did–a stand for credibility. On the internet, where a person can easily choose between dozens of search engines, email providers and instant messaging services (all things that collect highly personal information), I think people use Google not only because it offers a quality service, but also because they trust the company. I think investors see Google’s choice as a boon to their credibility, and thus, a move that will reinforce their position in the market place. Not to mention, Google’s now got the backing of the White House (further strengthening its credibility).
But this was no easy decision for the people at Google. Remember, they discovered this problem a month ago (maybe even before). The reason that they made their announcement now is because it took them that long to decide what to do. According to the Guardian, “the company’s decision was influenced by the experiences of Sergey Brin’s Russian refugee background,” who wanted to directly reproach the PRC, while Google’s CEO, Eric Schmidt, argued to stay.
Anyway, what’s tragically consistent is that most Chinese aren’t hearing much about this whole kerfuffle due to the strong censorship on the internet imposed by their government. And what’s sadly noble is that a few who do know are laying flowers at and pouring out liquor on the Google China sign outside the office, as if it were a funeral.