Why Did Google Threaten to Quit China?

Is it a stand for human rights or a shrewd business calculation?

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Google's decision to stop censoring its Chinese portal in response to December cyber attacks is rocking technology, business, and foreign policy commentators. Google anticipates that this could mean shutting down its Chinese operations entirely--a startling suggestion given the size of the market. So is Google serious? While some applaud the stand against censorship and government bullying, others say the move could be a cynical public relations stunt or a canny retreat from a tough market.

  • 'Last Straw' "For years," explains The Atlantic's China and tech expert James Fallows, "the company has struggled to maintain the right path in China," obeying local law despite difficulties and criticism over censorship. But clearly "the latest wave of provocations and intrusions was simply too much."
  • Business Considerations  TechCrunch's Sarah Lacy thinks this may have been "as much about business" as human rights. "Google's business is not doing well in China," she points out, and "Google is ready to burn bridges. This is not how negotiations are done in China, and Google has done well enough there to know that ...  If Google were indeed still working with the government this letter would not have been posted because it has likely slammed every door shut." So what's the point? "This was a scorched earth move, aimed at buying Google some good will in the rest of the world." She points out that Yahoo may have "played China far better," opting out of direct competition in a country it "wouldn't win" and instead bought "nearly 40% of Alibaba, a company that very definitely knows how to grow in China."
  • The Good Cyberwar Fight  The Guardian's Charles Arthur is optimistic about Google's sincerity: "The internet giant has declared cyberwar on the world's biggest nation. Who would be brave enough to take on more than a billion people? But the method it has chosen is to flood them with the resource that is so plentiful: the world's information." ZDNet's James Farrar likewise prefers to think that Google's is a "principled stand ... such bravery is sadly all too rare." The Big Money's Chris Thompson calls this "Google's finest moment."
  • A Strategy to Save Face?  "I'm waiting," writes Richard at Peking Duck, "for the conspiracy theorists who claim this is google's creative strategy for exiting China, where things never went quite the way they expected, while making them look like the victim instead of the loser." The Atlantic's Marc Ambinder points to a slightly wackier theory: "Some folks are suggesting that Google is attempting to cover for the flood of complaints that its new Nexus One phone has received. That's not likely." Yet at Foreign Policy, Evgeny Morozov is also, he himself admits "cynical," suggesting "Google was in need of some positive PR to correct its worsening image (especially in Europe, where concerns about privacy are mounting on a daily basis). Google.cn is the goat that would be sacrificed, for it will generate most positive headlines and may not result in devastating losses to Google's business."
  • Can Google Possibly Follow Through?  "The common assumption," point out Jessica Vascellaro, Jason Dean, and Siobhan Gorman for the Wall Street Journal, "is that no matter how onerous the limitations and challenges faced by foreign companies in China, the market is too big to walk away from." Companies that withdrew after Tiananmen "mostly came back."
  • Yes: Here's Why  Though the threat to shut down China operations "looks like sheer business lunacy," begins ZDNet's Larry Dignan, it's worth pointing out that "Google's currency is user trust," violated in the case of the Chinese attacks. Breaches of trust in China, he argues, "can hurt Google's other businesses," while "Google doesn't have as much to lose in China"--he, like others, points out that China is "one of Google's weakest markets." He also adds that, while the "threat to leave ... may be a bluff," there's also potential "regulatory payoff" in the U.S. and E.U.
This article is from the archive of our partner The Wire.