All talk?
David Drummond, SVP of Corporate Development and Chief Legal Officer for Google, just dropped a very provocative post over on the official Google blog.
Normally a post of this nature would go pretty much unnoticed (except by the tin-foil hat wearing security freaks) as it details an attempted attack on Google and a number of other companies operating within China.
What makes this post truly interesting however is the tone of the post, which, to my mind at least insinuates that the Chinese government were themselves responsible (or at least played a part), without ever coming out and actually making that accusation.
While that was provocative enough, the real sensationalism was to be found in this bold statement:
We have decided we are no longer willing to continue censoring our results on Google.cn, and so over the next few weeks we will be discussing with the Chinese government the basis on which we could operate an unfiltered search engine within the law, if at all. We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.
Wow, it sounds like Google is going to pull out of China. After all we know the Chinese government won’t back down, so what choice will they have?
To be honest, it’s all saber rattling. Google is trying to put pressure on the Chinese government, a regime that it knows doesn’t even generally bow to the massive weight of global political and public opinion.
In fact, Google is so aware of this that they provided themselves with a back door within their statement:
and so over the next few weeks we will be discussing with the Chinese government the basis on which we could operate an unfiltered search engine within the law
I’m confident that the settlement will come, one way or the other, and there are a number of reasons for it.
First and foremost there is the financial situation. Simply put, the amount of money Google will lose.
In Q2 of 2009 there were 338 million internet users in China and Google was the search engine of choice for 23.7% (about 80 million) of those users in Q3. That’s more users than North America which had 246.8 million users.
Add that to the fact that the Chinese market is growing rapidly as internet penetration is only 26.9% (or 1 in 4 people are online) compared to the saturated US market which has 74.2% (or 3 out of 4 online) penetration.
It doesn’t take a rocket scientist to see that there is too much at stake to walk away and too much potential for growth.
Could Google really walk away from that? Could they honestly allow their market share in China to be eaten up by Baidu (the number 1 search engine in China) or to allow Ballmer to walk Microsoft in there and expand their market share? Or even better have Ballmer cut some sort of a deal with the Chinese government?
Sara, Steven Hodson and others have pointed out that Ballmer wouldn’t walk into that hornets nest. I think he would. What is there to lose?
Microsoft already operates Bing in China so it won’t be as if they can be demonized for pushing into the territory.
The digiratti may get up in arms about it, but who in the real world listens to them? Once they leave the geek twitter/blogosphere they have no real influence over the masses, no matter how they may delude themselves. Lets make it very clear-being famous in the blogosphere is nothing but an ego trip. It comes with no power and you won’t be recognized if you walk into the average pub.
Mainstream media will pick up on the story, but they’ll likely focus on the fact that Google is pulling out and not who is staying in. Even if they did, you can be sure Microsoft would have an army of PR experts ready to be on the tube and tell everybody how they’re trying to do the right thing, by sticking it out and fighting for the Chinese peoples right by providing them a service, working with the government and trying to affect change. Not like childish Google who couldn’t take the heat so took their toys home to play in their room alone.
The number of activists who may give out about Microsoft (and others) staying in China will be many, they will be loud, rant and rave on twitter, get their backs up and shout from atop their high horses, but very few of them will do anything about it.
Only a very minute percentage will actually bother to stop using Bing, or to not buy a Microsoft product and even their outrage will be short lived before they go back to their old habits.
Most will forget what they were angry about after a few days, and the real world will have forgotten about it within 24 hours of the mainstream media miking it.
The bottom line to a company like Microsoft would be an increase in revenue from the Chinese market that would far, far outweigh any potential loss or fall out from the few malcontents who actually do something about it rather than just rant on twitter and blow hot air on their blogs.
Public opinion can be a wonderful thing, but it only works as long as the public pays attention. In this day an age the public has an attention span that can be measured in minutes. The next time Angelina and Brad adopt, that Madonna farts or Obama stares at a girls ass, it will all be forgotten about.
The Chinese government has a stubborn streak and disregard for international opinion that is beyond legendary and Microsoft are definitely not above doing something that may not immediately be popular in order to gain a long term advantage and the public is too wrapped up in dealing with their own economic woes and miserable lives to really care who is providing search results to the Chinese.
Finally and above all, Google is not a public service. They are a business and their primary responsibility is not to their users but to their shareholders. Leaving China would not be in their shareholders best interest.
Google are testing the waters to see if they can get a concession. It would take some serious brass balls to pull out of the Chinese market and give their foothold over to competitors. Brass balls, which for all Google has done in the past, I think are more like two rolled up socks stuffed down the underpants.
They may look impressive from afar, but they don’t hold up to scrutiny.
