Google operation in China

Google quits rerouting China's Web traffic to Hong Kong;


Internet king tried to beat censorship law



BYLINE: Byron Acohido



SECTION: MONEY; Pg. 7A



LENGTH: 572 words



Under threat of government sanction, Google on Tuesday stopped automatically redirecting Chinese Internet users to its uncensored Chinese-language website based in Hong Kong.

The search giant made a slight change in an attempt to satisfy government regulators and avoid losing rev-enue from advertisers wanting to reach Google users in the vast Chinese consumer market.

"Google is playing a game of chess with China," says Internet marketing consultant Andy Beal, editor of Marketing Pilgrim. "But it's clear that Google doesn't know what tactic will actually result in it being able to keep its presence in China."

Google shut down its 4-year-old Beijing offices on March 22 to resist censorship, which all companies oper-ating in China must accept. Search industry analysts said the company may also have been frustrated by its inability to gain more ground against the government-owned Baidu search service, which accounts for 60% of Chinese searches.

In exiting Beijing, Google activated a mechanism that automatically redirected any Chinese user navigating to Google.cn to its website in Hong Kong, which is run by China but does not impose censorship.

Beijing has now said Google can't do that. "It's clear from conversations we have had with Chinese govern-ment officials that they find the redirect unacceptable," says David Drummond, Google's chief legal officer.

Drummond said in a blog posting that the company risked losing its license to operate at all in China.

Google's automatic redirects will end sometime this week; henceforth Chinese users will have to click on a tab to reach Google's Hong Kong website. There was no immediate word from Beijing about whether that was sufficient.

Drummond offered that "this new approach is consistent with our commitment not to self-censor and, we believe, with local law."

But China expert Robert Lawrence Kuhn, speaking from Shanghai, where he is on a consulting trip, says it's doubtful Chinese officials will be appeased.

"There is no material difference between an automatic redirect and a one-click redirect," says Kuhn, author of How China's Leaders Think.

With its economy going strong, China has become accustomed to having the upper hand negotiating with foreign superpowers, much less a lone U.S. corporation, says economist Anthony Migyanka, managing partner of the finance blog Mobile Money Minute.

"Google is doing a nice Western job of following the letter of the Chinese law, but the law becomes whatever the Chinese government wants it to become," Migyanka says. Google's protest is "like a jet ski hitting the side of a battleship. Maybe it makes a tiny sound, but it's not making a dent."

China probably will take its time crafting a measured response. Media censorship is viewed as an essential tool for maintaining the Communist Party's unchallenged control of government, Kuhn says.

Meanwhile, China's economic development strategy calls for inviting tech companies to do business in Chi-na.

And Beijing risks alienating prospective tech partners, says Usha Haley, business professor at New Zeal-and's Massey University and author of The Chinese Tao of Business.

Chinese censorship "contradicts other deeply held (Western) beliefs about the free flow of information and freedom of speech from which so much creativity stems," Haley says. "Rather than put themselves and their knowledge-intensive assets in a vulnerable position, these companies may wall-off critical technologies."



LOAD-DATE: June 30, 2010



LANGUAGE: ENGLISH



PUBLICATION-TYPE: NEWSPAPER





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