POLT 762 Final Thesis
-
Upload
leonidas-ocampo -
Category
Documents
-
view
195 -
download
1
Transcript of POLT 762 Final Thesis
Leonidas Ocampo
Lee72
Chinese Internet Censorship
Senior 2015
Political Science & International Affairs
Morristown, NJ
Other URC Presentation IA 701
Final Draft
I. Problem:
Although China has seen great economic development within its country over the past
50 years, it still has some distance to go before reaching the same levels of market
productivity as the US, EU or Japan. China holds strict regulations over the Internet that
not only grant them considerable control over domestic industries but also over its
citizens and the type of information they deem acceptable for them to absorb.
Internet in China has seen incredible growth since the turn of the 21st century. The
Ministry of Industry and Information Technology estimates that between 1997 and 2008,
the Internet population grew from 630,000 users to 221 million, resulting in an annual
growth rate of 70.36%.1 Later on in 2008, China surpassed the US in the number of users
of the Internet, as announced by the government-linked China Internet Network
Information Center (CINIC), which estimated nearly 298 million users.2 People from all
around China have become more connected as a result of economic development and the
spread of Internet related technologies, with 99.1% of villages having Internet
connections, 95% having access to broadband and an impressive 3G network covering
most of the nation.3 As of 2010, China’s online population reached 404 million users and
no doubt continues to grow.4
The demand for Internet and related skills is high in China. In 2007, “China’s inward
FDI was estimated at $758 billion, ranking it sixth after the United States, United
Kingdom, Germany, France and Hong Kong.5 Of the worlds 500 largest companies, 1 Xin Wang. "Foreign Direct Investment and Innovation in China's e-Commerce Sector." Journal of Asian Economics. 3 (2012): 2902 Anonymous. “China and the Internet: An uphill fight for freedom.” 2009. Harvard International Review. 2 (Jul 2009): 683 Li Dan. “The Internet and Chinese Civil Society.” China Rights Forum. (2010): 14 Ibid5 Wang. "Foreign Direct Investment and Innovation in China's e-Commerce Sector." 287
approximately 490 of them have set up offices or acquired companies in China while
“more than 1160 global R&D centers have been established.”6 The Computer Science
major is the most popular major degree, with nearly 1180 universities in China offering
them and student enrollment exceeding 800,000.7 It is estimated that in the next 10 years,
China will need nearly 1 million IT employees to service China’s technological
infrastructure.8 The amount of growth this country has experienced in the past decade and
a half alone is impressive, thus making it quite the eye opener for foreign Internet
companies.
It is very appealing for westerners to see China and its populace as the next frontier,
however to maintain power domestically and not let foreign intervention diminish the
control the Chinese government has over its domestic enterprises, it issued many
regulations that eventually “effectively declared the illegality of all foreign-invested
businesses of any kind” to operate in China.9 For example, advanced applications from
outside countries are banned or heavily restricted (i.e. Youtube, Word press, Blogspot,
Facebook), while Gmail and Hotmail remain unreliable and slow.10
It is said that “China represents a high context culture,” essentially meaning that the
Chinese require context clues as opposed to the spoken or written word to clarify or re-
assure their stance on a certain situation.11 A simple example of the dichotomy in
character would be the collectivist and individualist mentalities of the Chinese and US,
6 Ibid7 Ibid, 2918 Ibid9 Philip Sohmen, "Taming the Dragon: China’s Efforts to Regulate the Internet," Stanford Journal for East Asian Affairs. 1 (2001): 17-26. 10 Anonymous. “China and the Internet: An uphill fight for freedom.” 6811 Wang. "Foreign Direct Investment and Innovation in China's e-Commerce Sector." 292
respectively.
“Individualist cultures encourage people to look after their own interests and those of their immediate family and differentiate from others, whereas in a collectivistic culture, people generally value social networks and others’ opinions more.”12
What this essentially translates to be is the varying strategies that need to be
considered in order to attract and maintain business within each country. Appealing to the
Chinese citizenry is essential for sustainable business practices but has proven more
difficult than previously expected. There are many barriers to foreign Internet companies
within China that are not solely influenced by the government, but also by the people
themselves. For the purpose of this paper, I will focus on the restrictions given to foreign
Internet companies by the Chinese Communist Party (CCP).
It is often noted that the legal foundation regarding foreign enterprise’s involvement
and capabilities within China is largely ambiguous or non-existent. China accepts foreign
Internet firms whom are willing to remain compliant with their laws and procedures for
regulating information and content. The purported goal with Internet controls for the
Chinese government is to “limit pornography, gambling and other harmful practices,”
however this type of content is usually easier to access than political or religious groups,
human rights violations and alternative news sources.”13 This however extends far deeper
into more case-sensitive topics that the Chinese government can’t afford to let proliferate.
“Among the most censored Information on the web remains criticism of top leaders, independent evaluations of China’s rights record, violations of minority rights in Tibet and Xinjiang, Falun Gong spiritual group, 1989 Beijing massacre, various dissident initiatives that challenge regime on a systemic level (i.e. Nine Commentaries and Charter 08.)”14
The government seeks to limit all unfavorable information and content from
12 Ibid13 Anonymous. “China and the Internet: An uphill fight for freedom.” 6914 Ibid
circulating, therefore they have established complex systems of filtering and blocking
information by use of the infamous Great Firewall. Provisions exist not only within
multiple agencies and their enforcement jurisdictions, but also within basic entrance
agreements outlining full promise for compliance as well as psychological tactics of
“encouraging” self-censorship.
Foreign involvement in the Chinese economy exists only with compliance to their
domestic policy objective of censoring information and content from their citizens. It
almost seems that if a business wants to have any economic success within China, and
it’s not a national, then it has no choice but to comply with the government’s
predetermined procedures for censorship. This is where a big problem lies, between
politics and economic growth; therefore the issue involves the balancing act between
domestic economic growth and foreign investment and involvement. The question that
fascinates me and creates the foundation for this study is why does the Chinese state
control the Net?
This paper seeks to understand, on a more fundamental level, why the Chinese
government has restrictions on foreign Internet firms and their involvement in their
domestic economy. Why is this question so important? China being a rising power in the
world is currently leading the largest campaign of Internet censorship the world has ever
seen. This Internet policy is acting as both a catalyst and inhibitor of domestic economic
growth. I feel it necessary to study their relationship with Google to see just how
determined they are in maintaining a strong grip on the Internet, how difficult (or easy) it
is for foreign Internet companies to establish branches within China and how it has
affected their economic growth potential. China has shown no signs of slowing down, so
for the purposes of understanding international political economies, I feel that researching
a country that manipulates the supply and demand of their own economic potential could
be a rewarding and informational experience.
II. Possible Hypotheses:
A) Individual Decision Maker:
In examining the first level of analysis, the individual decision maker, one must
take into account the various experiences a person of power will draw from for decisions.
Many factors like the individual’s up-bringing and previous experiences can contribute to
the final decision made on a certain policy or issue. Amid growing tensions regarding
global Internet policy, China is attempting to maintain control over the Internet while
achieving consistent economic growth and preservation of social order and confidence
towards the party. Chinese President Xi Jinping has a unique perspective on governance
and first hand experiences brought about during the Cultural Revolution in China. His
father, Xi Zhongxun, having been both a “revolutionary” and a “reformist” at different
points in China’s development, was a big influence to Xi’s level of commitment to
Chinese economic and political success.15 Xi Jinping’s reflections on the role of the west
and the collapse of the Soviet Union has molded his perceptions and given him cause to
pursue strong, authoritative public policy in relation to the economy and media. This is
because of his fear to what heavy western influences can do to a society. My first
hypothesis states If Chinese President Xi Jinping seeks to diminish western influence over
China’s people and economy for fear of a “great leap backward,” then the restrictions
on foreign Internet companies will be stringent. I will not focus on this particular
15 P. H. Yu. "What Kind of Leader Will Xi Jinping be?" American Foreign Policy Interests. 6 (2012): 297
hypothesis due to my inability to find enough reputable primary and secondary sources to
make an intelligent assessment of Xi’s influence over policies regarding foreign Internet
companies.
B) International Environment:
Considering the international environment requires us to first examine China and its
Internet policy in relation to other countries. Their flexibility or rigidness in cooperating
with foreign companies provides evidence to the association between China and foreign
Internet enterprises. China’s increasing measures in Internet regulation is a form of
protectionist policy that is designed to manipulate the information accessible to the public
as well as to minimize risk of advanced foreign firms from taking advantage of domestic
enterprises and subverting their power relationship with China. Inhibiting certain foreign
firms from entering the Chinese market has allowed domestic innovation and enterprise
growth to flourish by developing Chinese equivalents that in turn make the Chinese
economy on the international stage more competitive. It has provided a medium for
Chinese creativity to blossom at the expense of certain liberties the Internet has to offer.
If China desires to prevent foreign penetration into domestic Internet technology
companies, then the restrictions on foreign Internet companies will be stringent. This
hypothesis doesn’t allow me to focus on the primary reasons for strict regulations on the
Internet as does analyzing the CCP’s policies; therefore I choose to direct my study’s
focus on the domestic determinant of stringent policy towards foreign Internet
companies.
III. Principle Hypothesis:
C) Domestic Determinant:
Examining the domestic determinant leads us in the direction of reviewing the CCP’s
stance towards Internet regulation and censorship domestically, their application of those
standards to foreign Internet companies and their willingness to cooperate with them. The
Information Technology industry contributes 10% to China’s total GDP, thus making the
control of the Internet, media/news and the telecommunications industries of paramount
importance to all sorts of policy.16 One aspect of controlling information in the eyes of
the CCP is to limit the amount of dissident ideas and movements from coming about in
light of western democratic principles and thoughts of a less-regulated market. Foreign
involvement into China’s market can be a catalyst not only for foreign investment and
economic growth but also for information sharing and social change which can be
detrimental to the CCP’s policy objectives. Internet regulation within China, its economy
and the political climates are closely tied.
“Internet firms are required to follow Chinese legal provisions to enforce filtering of information of a
wide range, from the kinds threatening international security, unity and stability to those spreading rumor,
pornography and violence, often vaguely defined.”17
For fear of a populace influenced by a free flow of information that provides radically
different perceptions to issues of all varieties, the Chinese state has increasingly imposed
tight canons to reduce the amount of Internet freedom the public has access to. If the
Chinese state views foreign involvement within the Chinese economy as detrimental to its
legitimacy as a governing body, then the restrictions on foreign Internet companies will
be stringent.
16 Min Jiang, “Authoritarian Informationalism: China’s Approach to Internet Sovereignty” SAIS Review. 2 (2010): 71-8917 Min Jiang. "The Business and Politics of Search Engines: A Comparative Study of Baidu and Google's Search Results of Internet Events in China." New Media & Society. 2 (2014): 215
For this reason I am choosing to focus my research on the CCP’s domestic Internet
censorship and regulation policy and how it has manipulated it in an effort to undermine
foreign Internet companies’ influence within China. Reviewing the case of Google’s
involvement in China will grant me better understanding of the CCP’s position towards
foreign Internet companies. Examining the relationship between Google and China in
business will provide me quality evidence to the advantage or detriments of their
cooperation. This study hopes to then analyze the end result of their collaboration in
order to judge whether or not the CCP will pursue stringent restrictions on foreign
Internet companies.
IV. Case Study:
1) Policy Direction
Quickly pointing out the foreign policy direction the fifth generation of PRC leaders
will be taking will serve as a means to explaining certain rationale within the CCP. Why
is this important? It’s necessary to understand the policy maker’s perspective to foreign
policy and foreign actors when attempting to understand policies being implemented that
are relevant to them. Although the focus is a domestic determinant analysis of foreign
Internet companies in China, to not acknowledge the CCP’s perspective on future
Chinese growth and their potential cooperation with foreign actors would be unwise in
attempting to gain a more theoretical background of the issue.
The fifth generation of PRC leaders seem to have aspirations of “continuity and
innovation” present within their foreign policy strategy.18 This means that as part of the
“Chinese Dream” (中国 们), there are two goals the Chinese government wishes to
18 Vladimir Portyakov. "Outlines of the Foreign Policy of the Fifth Generation of PRC Leaders." Far Eastern Affairs. 1 (2014): 23
achieve. 19 Attaining a moderate level of prosperity by 2021 and to join the ranks of
developed nations by the PRC’s centennial in the year 2049.20 This is important to note
because the new leadership in the CCP have taken a stance to develop independently,
both economically and politically. Controlling the Internet and all business that requires
its use allows them to manipulate the extent to which businesses succeed. Creating an
ultimatum for compliance to their restrictive Internet policies grants them considerable
power over the success or failure of companies within China. Moving forward, it is
important to remember their strong stance on being the makers of their own destiny. This
may come as a result of events in China’s history so their position on Internet regulations
to foreign Internet companies isn’t likely to change, regardless of international pressure.
2) Overview of the Internet and Censorship System
An overview of the system itself is beneficial to paint a picture of exactly what types
of barriers foreign Internet companies must comply with in order to conduct business in
China. I will briefly cover a few pieces of legislation that granted the government
widespread control over the telecommunications and high tech industries, news/media
outlets and specific information and content. I will then layout different methods of
censorship and their corresponding organs of regulation and enforcement.
In 1994 a piece of legislation dubbed the “Rules of Security Protection of Computers
Information Systems” effectively established “the basis for government control over and
surveillance of computer networks.”21 In 1997 the “Computer Information Network and
Internet Security, Protection and Management Regulations” piece of legislation made it
so the government could physically limit the access of information and content of the 19 Ibid20 Ibid21 Sohmen, "Taming the Dragon: China’s Efforts to Regulate the Internet." 19.
Internet.22 Wu Jichuan, the minister of the MII announced that “Internet Businesses
would be classed as value-added telecommunications services” falling under provisions
of the 1993 regulations governing telecommunications industries, dubbed the “PRC
Interim Provisions on the Approval and Regulations of Businesses Engaging in
Telecommunications Services.”23
Two regulations form the backbone for the censorship of information and content.
The “Measure on the Administration of Internet Information Services” as set forth by the
State Council sets out three systems for websites to operate legally through a permission
request, approval and specialized approval process.24 The “Provisions on the
Administration of Internet News and Information Services,” as shaped through the joint
efforts of the Ministry of Information Industry (MII) and the Information Office of the
State Council, created a qualification permission system for defining appropriate methods
for news to be spread.25 It identified which news websites and entities were allowed to
divulge the type of information (i.e. commentary on social and public affairs, politics,
economics, military affairs and diplomatic affairs).26 The legislation on Measures and
Provisions held 9 and 11 categories, respectively; of “harmful information” that forms the
basis for the censorship of information and content.27 In light of this specific information
there is often uncertainty and vagueness of policy and legislation. This is due to a lack of
transparency because of the issue of multiple state groups enacting policy over Internet
censorship.28
22 Ibid23 Ibid, 22-2324 Bei Feng. “China's Internet Censorship System” China Rights Forum. 2 (2010): 40-4625 Ibid26 Ibid27 Ibid28 Sohmen. "Taming the Dragon: China’s Efforts to Regulate the Internet." 17
The government attempts to control information and content accessible online by
using a combination of seven tactics to censor material.
“1) Filtering and Blocking, 2) Deletion and Removal of Content, 3) Cyber Attacks, 4) Device
Level and Local Controls 5) Domain Name Controls, 6) Localized Disconnection and Restriction, and
lastly 7) Self-Censorship due to surveillance.”29
The most pertinent to foreign Internet companies as seen through Google’s
involvement within China are the Filtering and Blocking, Cyber attacks and Self-
Censorship tactics. The filtering and blocking strategy is often the most talked about
when considering Chinese censorship policy because it is the foundation to the Great Fire
Wall (GFW) that targets “keywords/phrases, certain domains, internet addresses,
home/school/university/corporate networks, Internet service providers (ISP) or even
entire countries.”30 Google is a search engine above all else therefore the GFW played
heavily into Google’s ability to conduct their business in China. Cyber attacks are also a
notable example and was a driving factor to Google’s retreat from China due to military
organized attacks launched at Google’s Gmail accounts targeting “human rights activists,
whistle blowers, dissidents, journalists etc.”31 Lastly, the intense tactic of self-censorship
has evolved over time to become more of a psychological deterrent among both citizens
and businesses in China due to the heavy surveillance of their networks.
The State Council Steering Committee on National Information Structure (SCSCNII),
which coordinates with several bureaucratic bodies according to different areas,
“formulates strategy, principles, rules and regulations in developing national
29 Rebecca MacKinnon. “China’s Internet Censorship and Controls: The Context of Google’s Approach in China,” China Rights Forum. (2010)30 Ibid31 Ibid
informatization, coordinating projects and establishing standards.”32 The MII is
responsible for the day-to-day regulation of the telecommunications and high tech
industries.33 Under the MII are six self-declared functions:
“I) The formulation of strategy, policy and plans for the information, telecommunications and software
industries, II) to draft and enforce regulations governing these industries, III) to plan, build and manage
public networks for government and military, IV) to allocate and coordinate bandwidth, V) to supervise
telecommunications and information services markets and implement licensing and VI) to assist the
development of the information industry.”34
In outlining the censorship system of information and content, different tactics used
to restrict material and enforcement agencies relevant provides us a brief summation to
the type of system foreign Internet companies are entering in China. The aforementioned
system and its goals are what foreign Internet companies must be aware of prior to
agreeing to compliance.
3) Google in China
As part of my case study on Google’s involvement in China I will separate my
argument into four different sections. First I will go over the intentions of Google for
entering the Chinese market and initial successes that boosted its image. Next I will go
over issues it faced after establishing itself and reasons for Google exiting the mainland
economy to Hong Kong. Lastly I will go over the implications of their departure on
international politics and future foreign Internet enterprise’s endeavors in China.
China is a country with a population of mobile and Internet users that is nearly three
times larger than that of the US’ Internet users. The use of mobile and Internet services in
32 Sohmen. "Taming the Dragon: China’s Efforts to Regulate the Internet." 1833 Ibid34 Ibid
China range from online shopping, social networks, news/media outlets to email and
instant messaging services and search engine queries. Daily life in the urban centers of
China revolves around the ability to access the Internet and communicate for both
professional and social purposes. It is estimated that overall Internet penetration of
China’s total population as of 2010 was nearly 28.9%.35 In a study analyzing Google’s
involvement in China, as cited by Tan, “the Chinese market is simply too important for
any major search engine to miss out on, regardless of the cost, and [if] US
companies...withhold their expertise, then firms from other countries will just step in.’’36
As part of Google’s corporate mission they wish “to facilitate access to information
for the entire world, in every language.”37 Their intentions for entering the Chinese
market in 2005 weren’t limited to intelligent foresight but matched that of other search
engines like Baidu and Tencent (both domestic Chinese companies) as well as Yahoo!.38
Statistically speaking, “the aggregate value of China’s search industry rose as much as
73.1 %, to 5.02 billion RMB (about US$735 million) in 2008 and 6.95 billion RMB in
2009, regardless of the influence of the global recession.”39 This coupled with the fact
that of China’s 538 million netizens in 2010, 79.7% reported using search engines,
making online search the second most popular online activity.”40 The significance to
mentioning these figures is that at the time in 2005, the market for search engines was
35 Li “The Internet and Chinese Civil Society.” 136 J. S. O’Rourke, B. Harris, A Oglivy. “Google in China: Government censorship and corporate reputation.” Journal of Business Strategy. 3 (2007). 17.37 Justin Tan, Anna Tan. "Business Under Threat, Technology Under Attack, Ethics Under Fire: The Experience of Google in China." Journal Of Business Ethics. 4 (2012): 47138 Ibid 47039 Ibid40 Min. "The Business and Politics of Search Engines: A Comparative Study of Baidu and Google's Search Results of Internet Events in China." 213
still young and not established enough to have a dominant player. Seeing as Google is a
primary search engine in the US and many countries around the world, reaching out and
establishing a foothold in China would not only contribute to their overarching goal, but
also be a sound investment into a population that rivals most developed countries in
Internet use.
Although Google had created a Chinese version of “google.com” in 2000, they had
not officially set up and launched the “google.cn” search portal in China until 2006.41
Their presence in China was seen as a new beginning for the Chinese users due to their
awareness of Internet regulations. Google was at a disadvantage due to their inherent
distance from Chinese culture and ideology. Domestic enterprises have an advantage to
business due to their ability to understand basic Chinese principles of consumer
tendencies and services desired. In order to live up to high expectations Google ended up
investing a lot in itself for the purpose of coming out strong and appealing. In 2007 they
began cooperating with large Chinese firms like China Mobile and Tanya in order to
establish a user base.42
Even though they are a household name across the world, they needed to build
credibility and trust from the Chinese people for them to set themselves up for success.
They began developing products that were unique to the Chinese market and focused on
the needs of the Chinese user. Developing products such as “the Google Pinyin Input
Method, Google Life China, and Google Maps China” created an entirely new perception
to their business in China.43 The Chinese people saw Google as a caring enterprise that
41 Tan et al. "Business Under Threat, Technology Under Attack, Ethics Under Fire: The Experience of Google in China." 47242 Ibid 43 Ibid
was attempting to accommodate to the Chinese market for the long haul. These specific
technologies and services built up support from local businesses and consumers and gave
Google the upper hand for a short period of time.
Upon arrival there was skepticism towards their ability to produce an ethical
search engine service for the Chinese populace in light of the Chinese state’s strict
Internet censorship on information and content. A big issue that foreign Internet
companies faced in China was catering to the Chinese users and their habits, preferences
and cultural customs. As mentioned before, entering the Chinese market as a foreign
Internet company will bring about problems that can only be solved with a deep cultural
understanding of Chinese society and its people. This idea was in the background of most
of the issues Google faced after entering China. The Chinese, being a “contextually
driven culture” thrives on loyalty and trust in any business transaction. There is a need for
a relationship to be built between the supplier and consumer in order for continued
business to occur in China. In a survey designed to gauge the trust perceptions among
Chinese Internet users, it was found that 88% “believe it is necessary to provide a “trust
label” to trustworthy business and individuals in online transactions.”44 As a result of
Baidu’s extremely high user awareness and usage rate, Google had a difficult time in
China, adapting and competing against domestic search engine companies due to their
distance from the culture.45 This created the realization that investment alone would not
suffice for sustainable business practices in China, they needed to diversify a bit more
and attempt to understand the local populace.
44 Wang. "Foreign Direct Investment and Innovation in China's e-Commerce Sector." 29345 Ibid 298
Another issue that came about was the competition faced between Baidu and
Google. Although Google had entered the market before Baidu, there was a big
difference in the way they conducted business in adherence to Internet censorship
policies. While Google did adhere to censorship policies, its competitor “stood in stark
contrast to the unquestioning compliance of local search engines such as Baidu, which
actively comply with Internet censorship and follow all governmental laws, rules, and
regulations to achieve stable growth with the backing of the government.”46 Google
managed to circumvent certain policies in an effort to remain as close to their mission
statement as possible but their unwillingness to completely conform was to their
detriment. As a result they began to see increased pressure from the government in GFW
filtering and blocking and they came under fire from cyber attacks.
Google fell victim to a series of cyber attacks that targeted their company’s
intelligence and private information. Rumored to be a military action, “Operation
Aurora” aimed to “gain access to and modify the company’s core technologies and
source codes as well as obtaining vast components of their source code.”47 Although a
failed attempt, this act of espionage was an early sign of adversity to Google’s mission
and presence within China. If that material had been accessed, the actors involved may
have had the capacity to manipulate Google’s source codes and maintain a more vigilant
eye on their operations in the event that Google attempted to further circumvent Chinese
Internet censorship policy. Another attack on Google targeted Gmail accounts of certain
dissident political thinkers. Also a failed attempt, this was an attack that hit more to home
than the other due to its relationship to individuals and their basic human rights. Google
46 Tan et al. "Business Under Threat, Technology Under Attack, Ethics Under Fire: The Experience of Google in China." 47547 Ibid 473
is a strong supporter of freedom of speech and although they have adhered to the Chinese
Internet censorship system, they weren’t inclined to reveal the information of individual
users that might implicate them in a crime down the road. They did not agree and did not
want to be responsible for the imprisonment of a free thinker in China. The constant
pressure from the government, its competitors and these cyber attacks began to change
the Chinese people’s perception towards Google in China.
Following these cyber attacks, an air of uncertainty plagued the company. The
Chinese people began to create perceptions of an unstable and incapable foreign Internet
company that would not be able to provide consistent and appealing services. As stated
by Tan, “This uncertainty drove away some users, pushing them to switch to the
significantly less tumultuous Chinese competitor Baidu. Google’s user base in China thus
eroded, causing a drop in its global market share from 65.5 % to 65.1 % between January
and March 2009… its share in China’s search market dropped to roughly 15 %, while
Baidu’s market share soared to 75%.”48 Clearly the importance of the user has an impact
on the overall productivity and level of success a company can have and Google was
experiencing this first hand. They were battling on three different fronts: attempting to
satisfy the Chinese user’s desires in services, competing with domestic search engines,
and navigating political processes that would allow them to legally conduct business as a
foreign Internet company in China. Their situation was grim and only grew worse as
Baidu saw increased growth and user involvement.
Due to the self-censorship provision in Internet policy being a “non-negotiable
legal requirement” as well as the factors discussed before, Google decided to cease all
48 Ibid
operations in main land China and move to the prosperous city of Hong Kong.49 There
has been much debate over the exact reason to Google moving from the main land to
Hong Kong but they generally revolve around the issues of for-profit business goals and
business ethics. In terms of for-profit business goals, they were losing a large share of the
market over a period of three years, which made their potential for sustained business
practice in China increasingly difficult. Their inability to adapt to the Chinese consumer’s
needs, compete with domestic companies and circumvent political processes was costing
them money. Investments made into Google services and technologies, although useful
and widely cherished, simply did not suffice. Ethically speaking, Google needed to move
due to their inability to maintain business in China without going against their mission
statement and ethical code. They would lose support not only within China but also
around the world if they had decided to wholeheartedly adhere to Chinese Internet
censorship policies.
Their departure from main land China had a few implications on international
politics and future foreign Internet companies. In regards to international politics, it led to
criticisms from the US towards China in regards to their level of openness to economic
development. It was also in deep contention with human rights advocacy groups, which
not only targeted the Chinese state for enforcing such stringent and limiting policies but
also Google and their decision to adhere to these policies after entering China. Many felt
that Google had “sold out” to the Chinese government in an effort to increase profit
margins. A common question and answer often prompted is whether Google’s primary
focus should be on profits as a business or enforcing moral and ethical codes of conduct
in Internet use. The Chinese claim to have a constitution founded upon principles of
49 Ibid 474
freedom of speech and other civil liberties, similar to those of democratic societies
however their legal interpretation and enforcement is far different from reality.
Regarding future foreign Internet companies, it creates a three-pronged issue of
politics, business and ethics. Due to the strict regulation of the Internet censorship system
within China, and the likelihood that all domestic companies will be unreservedly
compliant, foreign Internet companies must make a choice of going all in or not at all.
They must be ready to accept provisions that limit their capacity to share information and
content to the public as restricted by the government. They must be ready to adapt and
cater to the Chinese user in order to compete with equivalent local companies and
maintain growth and stability in China. They must finally make sure that going into
China will not be counter-productive to their company’s image and purported mission
statement. There are far reaching implications that can contribute to the collapse of a
business entity in China if foreign Internet companies are not well informed and
prepared.
Entering the Chinese market is entering an atmosphere far different than what
foreign Internet companies are used to. Due to the nature of China’s government being a
command and control society where there is heavy centralized power to the CCP,
democratic principles and free market economic rules are scant applicable. Unlike
conducting business in the US or EU where there are not only laws in place to promote
individual civil liberties but also protecting companies and their rights to business; doing
business in China brings about a slew of issues not easily understood. In reflecting upon
Google’s involvement within China it is important to note the difference in political and
economic structures when comparing it to other nations. Although it may be appealing
for a foreign Internet company to redirect its focus to this emerging market, embarking
on that journey unprepared will certainly lead to failure as evidenced by an incredibly
important and influential company such as Google.
V. Conclusion
Throughout my research I found there were some limitations to me understanding
Google’s involvement in China. There was more info on the ethics and human rights
issues of Google’s involvement then there was on the implications to international
political economies. There was far less literature on the rationale of the CCP towards
Internet censorship policy and restricting foreign Internet companies entering China then
there was of particular information and content restrictions. I think this study does well to
illuminate the general nature of Internet censorship in China and basic issues foreign
Internet companies face when conducting business there. For future studies I would alter
my study’s focus to the Chinese “netizen” and the restrictions they face, how it affects
daily life and what initiatives/movements have come about in opposition of Internet
censorship policy.
The role China will be playing in the next half century will mirror if not surpass that
of their role over the last half-century. They are a power that cannot be overlooked and
will be increasingly embedded in economic and political decisions within the 21st
century. The purpose of this paper was to study Google’s involvement within China
considering its intentions for joining, initial successes, problems faced, reasons for
departure and future implications on politics and other foreign Internet companies. I
argued, “If the Chinese state views foreign involvement within the Chinese economy as
detrimental to its legitimacy as a governing body, then the restrictions on foreign Internet
companies will be stringent.” In analyzing the content covered, I conclude that the CCP
will continue on with stringent regulations to foreign Internet companies whom do not
agree to comply with Chinese Internet censorship and regulations over business. The
Chinese state established Google’s involvement within China as detrimental due to their
capacity to spread information and content to the public. As part of China’s Internet
censorship policy, they were not at liberty to see a company divulge information that
might be detrimental to their governing body, therefore they imposed strict restrictions,
enacted cyber attacks and increased pressure unto Google for self-censorship that
eventually forced Google out of the main land economy. Following their departure the
Chinese state did not alter their Internet censorship provisions but made it more difficult
for foreign Internet companies to enter the market and circumvent the censorship system
by increasing overall pressure on foreign Internet companies to compliance. Also their
hardline stance on their Internet policy throughout the deliberations with Google over
their conduct in business reinforced their position and made it widely known
domestically and throughout the world. Moving forward, analyzing the story of Google in
China is highly recommended for any future business endeavors into China.
VI. Bibliography
Anonymous. “China and the Internet: An uphill fight for freedom.” Harvard International Review. 31 (2) (2009): 68-73. http://search.proquest.com.libproxy.unh.edu/docview/58827719?accountid=14612.
Dan, Li. “The Internet and Chinese Civil Society.” China Rights Forum. (2010). http://www.hrichina.org/en/print/content/3252
Feng, Bei. “China's Internet Censorship System” China Rights Forum. (2) (2010): 40-6, http://search.proquest.com.libproxy.unh.edu/docview/754078407?accountid=14612.
Jiang, Min. "The Business and Politics of Search Engines: A Comparative Study of Baidu and Google's Search Results of Internet Events in China." New Media & Society. 16 (2) (2014): 212-233. http://search.proquest.com/docview/1531928174?accountid=14612 (accessed April 7, 2015).
Jiang, Min. 2010. Authoritarian Informationalism: China's approach to internet sovereignty. SAIS Review. 30 (2) (2010): 71-89. http://search.proquest.com.libproxy.unh.edu/docview/853229565?accountid=14612.
MacKinnon, Rebecca. “China’s Internet Censorship and Controls: The Context of Google’s Approach in China,” China Rights Forum. (2010). http://www.hrichina.org/en/print/content/3248
O’Rourke, J. S., Brynn Harris and Allison Oglivy. “Google in China: Government censorship and corporate reputation.” Journal of Business Strategy. 3 (2007) 12–22.
Portyakov, Vladimir. "Outlines of the Foreign Policy of the Fifth Generation of PRC Leaders." Far Eastern Affairs. 42 (1) (2014): 23-28. Academic Search Premier, EBSCOhost (accessed March 30, 2015).
Sohmen, Philip. "Taming the Dragon: China’s Efforts to Regulate the Internet." Stanford Journal for East Asian Affairs. 1 (2001): 17-26. http://web.stanford.edu/group/sjeaa/journal1/china1.pdf.
Tan, Justin and Anna Tan. "Business Under Threat, Technology Under Attack, Ethics Under Fire: The Experience of Google in China." Journal Of Business Ethics. 110 (4) (2012): 469-479. Education Source, EBSCOhost (accessed April 16, 2015).
Yu, P. H. "What Kind of Leader Will Xi Jinping be?" American Foreign Policy Interests. 34 (6) (2012): 295-301. http://search.proquest.com/docview/1550999191?accountid=14612 (accessed March 8, 2015).
VII. Additional References
Anderson, Stephen J. “China's widening web.” China Business Review. 27 (2) (2000): 20-4. http://search.proquest.com.libproxy.unh.edu/docview/59819863?accountid=14612.
Dann, G. Elijah, and Neil Haddow. “Just doing business or doing just business: Google, microsoft, yahoo! and the business of censoring china's internet.” Journal of Business Ethics. 79 (3) (2008): 219-34. http://search.proquest.com.libproxy.unh.edu/docview/58774487?accountid=14612.
Eko, Lyombe, Anup Kumar, and Yao Qingjiang. "Google This: The Great Firewall of China, The IT Wheel of India, Google Inc., and Internet Regulation." Journal Of Internet Law. 15 (3) (2011): 3-14. Business Source Complete, EBSCOhost (accessed April 16, 2015).
Gore, Lance L P. "China's New Foreign Policy Team." East Asian Policy. 5 (3) (2013): 5. Publisher Provided Full Text Searching File, EBSCOhost (accessed March 30, 2015).
Hughes, Christopher R. "Google and the Great Firewall." Survival. 52 (2) (2010): 19-26. http://search.proquest.com/docview/754077972?accountid=14612 (accessed April 7, 2015).
Kim, Sung Wook and Aziz Douai. "Google Vs. China's "Great Firewall": Ethical Implications for Free Speech and Sovereignty." Technology in Society. 34 (2) (2012): 174-181. http://search.proquest.com/docview/1023031226?accountid=14612 (accessed April 7, 2015).