It’s rare that I simmer on a blog post for days and then write away, but this is one of those posts. It’s also rare I go through about 5-6 iterations of a post title, but this is one of those posts. Actually, I almost named this blog post the Tang Dynasty vs. Hu Jintao’ Dynasty. A title too esoteric for most readers, but those who have lived in China probably know where I’m coming from. More on that later. Either way, the sense in the blogosphere seems to be that Google’s threat to leave China has deeper reprecussions than one firm vs. regulators. I agreed wholeheartedly.
A very brief summary for those unaware: Google has said it is no longer willing to censor of search results in China, and may end its operations in China altogether following a “sophisticated and targeted” cyber attack originating from the country. That “sophisticated and targeted” is a euphemism for “the attacks were conducted either at the behest of or at least the tacit acceptance of the Chinese government” – as direct an accusation as Chinese culture permits. What makes Google so sure is that the attacks most targeted Chinese dissidents, and thus any of Beijing’s denials wouldn’t likely pass the smell test. The government hasn’t even tried. Chinese Foreign Ministry spokespeople dodged the question of hacks originating in China instead issuing the boilerplate statement “Google will not be treated as an exception to China’s demand foreign companies obey its laws”. Google upped the ante just today by suspending the introduction of the Google Nexus one phone in China.
Google’s moves aren’t entirely altruistic of course, but rather economic. Google’s entire business model is built on an open web and open standards as has often taken sides in the political debate on net neutrality for instance. The firm’s entire operating model is built upon promoting users to trust their information to Google, which is precisely what is under siege for what Google calls coordinated attacks. “I believe this is the largest and most sophisticated cyberattack we have seen in years targeted at specific corporations,” McAfee Chief Technology Officer George Kurtz wrote on his blog Sunday. He continues to write ”what really makes this is a watershed moment in cybersecurity is the targeted and coordinated nature of the attack with the main goal appearing to be to steal core intellectual property.” That’s precisely the issue. The threat of lost confidence along with the cost of mitigating the risk of systemic hacks drives up Google’s operating costs and potentially reduces it revenues in China. At the risk of seeming glib and simplistic, all of this makes China a “diminishing returns asset” for an investor backing an open web like Google.
The Chinese and commentators seem to have a sense of where this is headed. A number of Chinese Twitter users have been unsually vocal on tweets. One Twitter user writes: “It’s not Google that’s withdrawing from China, it’s China that’s withdrawing from the world.” Blogger and friend of mine Elliott Ng writes “I feel such sadness and disappointment for the Chinese people. They deserve to have access to the same resources and information that most people in the world have.” Some in Beijing have even held candlelight vigils, and some have been seen in a traditional bow of mourning in front of Google’s Beijing headquarters:
Nothing to Discuss?
“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” is the official line from Google, but I have to ask the question: what is there to discuss? Google has become increasingly vocal about censorship everywhere in the world, not just China. Public Policy Director Bob Boorstin, writing in a post in the Google Policy Blog, criticizes the Australian government’s efforts to censor the web down under. Just below, you’ll find a December 14th post about an internal anti-censorship workshop at which Ron Diebert of the Open Net Initiative gave a presentation about the spread of Internet censorship all over the world.” In the U.S., Google has directly fired salvos against telcos in Net Neutrality debate, and has railed against the secretive and appallingly evil ACTA trade agreement. I’m not suggesting Google is Mother Teresa here, only that their business is predicated on an open network. There lies the issue: Beijing perceives its power to come from a closed network. Siva Vaidhyanathan, author of the forthcoming book titles “The Googlization of Everything” captures this perfectly: “The Internet has enough diverse interests and players that it demands governance. No traditional state is in the position or willing to assume that role, so Google governs the Internet.” That’s why the issue plays out on a global stage: Google would prefer to have national governments cede control of the web to Google, and prickly China is an easy target. This is also why Google is taking on a statesman like role. This issue is worth more air time than I’ll give it here, but it is fleshed out in Rebecca MacKinnon’s highly recommended post.
Those of you who know me know I have a peculiar view of “anti-Americanism” – namely, that it stems from a feared loss of national and cultural identity in an age of globalization and ubiquitous McDonalds/CocaCola/Starbucks/etc. It’s worth noting that fear may be real or perceived, and thus I’ve felt for a long time America needs to stand for the right to information and the right to choose rather than “our way”. The prevailing wisdom is that economic openness would lead to societal openness. That’s particularly true since most Chinese with a solid sense of history will point to the Tang dynastic period (where china opened up the the world) as China’s “golden age”.
But there’s always been a nagging little voice inside my head wondering if growing economic clout doesn’t make China easier to bring into the rest of the world. Commentator Fareed Zakaria puts it this way: “We have assumed, perhaps too easily, that China’s rise would be accompanied by a process of modernization within that country that would make Beijing easier and easier to deal with. And in many ways that has proved true. But now we must confront a prospect that I have worried and written about—that China’s rise will reinforce Chinese nationalism and a sense of uniqueness and actually make the country less likely to easily integrate into the global system.” (emphasis added).
Several recent events have supported Zakaria’s fears (and mine). Take the COP 15 climate change summit for instance. Second-level Chinese officials showed up at critical meetings of heads of state and lay out open dissent. That includes one member of premier Wen Jiabao’s delegation shout and wag his finger at President Obama—suggests that Premier Wen had lost control over his own negotiating team. Now comes the spat with Google, and local competitor Baidu’s reaction to the events. In a blog post, the chief architect of Baidu said Google’s decision to quit was for financial reasons, rather than a human rights issue, as Google had failed to dominate the Chinese search market. ”What Google said makes me sick,” he said. “If you are to quit for the sake of financial interest, then just say it.” (I must admit I laughed as I copied this over).
I’m sure in some sense Apple’s Steve Job is flipping cartwheels in Cupertino, since the threat of a Google smartphone in such a large market may now vaporize. But the concern is that China is trending towards monopolies (particularly those with ties to the government), less choice and less disparate voices. It’s not hard to see how China would be harder to incorporate into the rest of the world as it grows economically if the country’s leadership operates with a different set of “facts”.
My sense is that virtually all other asian nations not only maintained but expanded an outward facing orientation during periods of rapid economic growth, where as China appears increasingly fixated on internal dynamics. It may be the result of a divided and confused government at odds with itself, or it may be indicative of something entirely different. Author Thomas PM Barnett‘s geopolitical model of the world divides the world into a “core” of nations which share information and conduct commerce relatively freely, and the “gap” which is comprised of nations who are walled off for various reasons. The worst case scenario is one where a rapidly aging Chinese population ends up in the gap, with noses pressed up against the glass, looking at the rest of the world as it goes about its business. Google leaving China is a firm step in that direction.