Storms and Coverage

It’s been a week of storms and interesting coverage.

On Saturday, March 20, Beijing had a relatively minor sandstorm, which generated a surprising large amount of coverage in the US. Friends emailed to see how we were doing, more so than during the tainted milk scandal. In the spring, sandstorms are a common occurrence in Beijing because north China is very arid and the closest dunes are less than 75 Km away.

On Monday, March 22, the gathering storm over Google’s business model in China broke when Google re-directed its .cn website to its .hk website in Hong Kong. Since Google’s blog post in January where they stated their intention not to censor search results in China, shutting down their .cn site was widely expected. It was unexpected that they would re-direct the traffic to their .hk website and shift the onus of censorship back on China. The impact to those of us in China that use Google’s search engine, gmail or other Google apps has been minimal. The Great Firewall of China still does what it did before, it blocks sites the Party deems to be sensitive or out of sync with the their view of history, society and the world.

Google’s commercial spat with China and its spillover into a bi-lateral political slanging match between the US and China has been covered by countless megabytes of bits and barrels of ink. What I have yet to see is an article on what I consider to be the root cause of the problem, but an all too common one that occurs when businesses enter China.

In 2006, Google knew when it set up its .cn website in China that the government required significant censorship of web searches, yet Google sacrificed their beliefs in freedom of speech and access to information to profit from the hundreds of millions of Internet users in China. In China, the market is littered with remnants of foreign firms that set up shop, do a deal they would never ever do in their home country, and then pull out because they can’t live with the deal they made.

Google could have, and should have, set up their simplified Chinese search business in Hong Kong to start with. Even though Hong Kong is part of China, under the One-Country, Two-System policy that governs Hong Kong’s post-handover to China, Hong Kong’s business rules, including freedom of speech, are different from those in Mainland China. If Google set up their search business in Hong Kong from the start, China would have censored Google’s search results just like they censor Yahoo’s, Microsoft’s or any other search engine. A Hong Kong base would have given Google a footprint in China from where they could have expanded with sales offices, or maybe an R&D facility, in China. This structure would have allowed them to operate more in line with their business principles. Instead, last week Google made a messy retreat from China, caused an international commercial and political firestorm, and shut themselves out of lucrative business relationships in China for many years to come.

Let me be clear, China’s censorship of the Internet is an outrageous, immature policy that will collapse in my lifetime just like the Berlin Wall did. Every single day, I am frustrated by China’s Internet censorship policies. Google needs to offer a simplified Chinese search engine. I just wish they would have thought through the implications of their China strategy before they jettisoned their principles to chase the dragon.

The only reason you are seeing this piece from me in China is because I have a VPN, which allows me to tunnel through China’s Great Firewall. Citizens of China don’t have that luxury because it requires a foreign credit card and a overseas mailing address.

For a great article on how China censors the Internet, read James Fallows’ piece here.