Google rejects censorship, threatens to quit China
Thursday, 14 January 2010
SHANGHAI/SAN FRANCISCO, Jan 13 (Reuters): Google Inc threatened to quit China, the world's biggest Internet market, warning it would no longer tolerate strict censorship of its Google.cn search engine.
The threat by the world's leading Internet search provider may win it praise for seemingly putting ethics above business, but give Microsoft and a handful of local rivals an edge in the huge yet problematic Chinese Internet market.
Google generated 53 per cent of its $5.9 billion in third-quarter revenue outside the United States, although it does not disclose the size of its business in China.
While Google's potential exit from a Chinese search market that is growing at 40 per cent would have little impact on its short-term revenues, analysts said that cutting itself out of this important market may carry a longer-term strategic cost.
Google issued its warning after discovering what it called "a sophisticated and targeted" cyber attack on its email service. Google said it believed hackers were targeting Chinese human rights activists.
That attack follows years of frustration in China for Google, which was heavily criticised for self-censorship when it entered the market in 2006.
China has more than 350 million Web surfers and annual search revenue topping $1 billion, but its Internet market has been a thorny one, with companies having to adhere to strict self-censorship rules dictated by Beijing.
The threat by the world's leading Internet search provider may win it praise for seemingly putting ethics above business, but give Microsoft and a handful of local rivals an edge in the huge yet problematic Chinese Internet market.
Google generated 53 per cent of its $5.9 billion in third-quarter revenue outside the United States, although it does not disclose the size of its business in China.
While Google's potential exit from a Chinese search market that is growing at 40 per cent would have little impact on its short-term revenues, analysts said that cutting itself out of this important market may carry a longer-term strategic cost.
Google issued its warning after discovering what it called "a sophisticated and targeted" cyber attack on its email service. Google said it believed hackers were targeting Chinese human rights activists.
That attack follows years of frustration in China for Google, which was heavily criticised for self-censorship when it entered the market in 2006.
China has more than 350 million Web surfers and annual search revenue topping $1 billion, but its Internet market has been a thorny one, with companies having to adhere to strict self-censorship rules dictated by Beijing.