Thursday, 14 January 2010

Google considers pulling out of China

The BBC website reports that Google is considering ending its operation in China following a "sophisticated and targeted" cyber attack which appears to have originated from the country. Although Google hasn't directly accused the Chinese government of being involved in the attack, the implication is there since Google is now saying they are no longer willing to censor its Chinese search engine (www.google.cn) which was launched in 2006 under an agreement to censor some of the search results, as required by the Chinese government.

The main issue now, according to Google, is that the Gmail accounts of Chinese human rights activists have been targeted by the hacking during December. The BBC report says that Google will now hold talks with the government in the coming weeks to look at operating an unfiltered search engine within the law in the country, though no changes to filtering had yet been made. The company will also be considering its future position in China.

This is likely to become a big issue for Google, as the massive Chinese market has long been a target to grow their online business - nearly 340 million Chinese people are now online, compared with 10 million only a decade ago. However, local-based rival Baidu holds 60% share of the market, compared to Google's 30%, and this remains a core challenge for Google to gain more share, although this latest attack on their service will be a significant concern.

However, Baidu has called Google's move "hypocritical" and claims it is financially driven. The chief architect of Baidu has claimed in a blog that Google's plans to quit are for financial reasons, rather than a human rights issue, as Google had failed to dominate the Chinese search market. The BBC also reports that Chinese authorities will be infuriated that Google has gone public with their decision whether to pull out of the country, before negotiations with officials get under way.

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