Historic Day: Google Leaves China

Late this afternoon, Google announced that it would cut its search engine in China making good on its threat. The Google search engine in China now redirects users to Google’s search engine in Hong Kong. In addition, the company said that they are not completely pulling out of China. They will still have cell phone services and research operations. A Google spokesman said it is "too early to tell" what will happen to its roughly 600 employees in China, who may be reassigned.

David Drummond, the company's chief legal officer, wrote in a blog post that the company's Hong Kong site is "offering uncensored search in simplified Chinese, specifically designed for users in mainland China and delivered via our servers in Hong Kong." Mr. Drummond said Google believes the move is a "sensible decision," but said Google is "well aware that it could at any time block access to our services."

The announcement comes after months of drama and commentary over Google’s Chinese fate, which has been up in the air since a January 12th cyber attack linked to Chinese universities and thought to be state sponsored. Google downplayed the attacks but said they were frustrated with China’s attempts to limit free speech.

Numerous western companies have found China to be a tough place to do business. Nearly every company that starts out in Beijing with promise, ends in bad blood or selling off the parts. After struggling to compete in China, Yahoo sold its Chinese operations to Alibaba Group, a local company; Ebay and Amazon never got traction; and Microsoft’s MSN instant messaging service badly trails rival Tencent.

Could it be that the technological future of China is to head in a different direction than Western nations? The future of China is not an open market, as we would prefer. It is tied to nationalism and doing business there is going to require a better understanding of the Chinese State. The debate will rage if Google has missed out on a serious opportunity but it would seem that the Chinese government prefers homegrown companies.

The loss of Google China will not effect their pocketbook severely, and at home in the US Google may now be seen as a champion for human rights, a company that empowers the individual and the search for knowledge. We will have to wait and see how the wager turns out.