Wall Street Journal reports today that Google is going back to China. Two years ago, facing censorship from the Chinese government, Google pulled out of mainland China, redirecting users to uncensored results from Hong Kong. Google took a stand against China's authoritarian regime, but it did so reluctantly. China is too tempting a market for Google to write off.The
Nevertheless, the WSJ reports that Google is hiring more engineers, salespeople and product managers and building new consumer Web services. As China's mobile market booms, Google is pushing Android there, and opening a Chinese Android Market for mobile apps is one of the top priorities.
Google's Troubled Past In China
Google's trouble in China all started in 2010, when it claimed that Chinese hackers had attempted to break into its services and committed malware attacks on Gmail accounts. Prior to that day, Google willingly censored its services at the government's request. But after tracing these attacks to China, and probably to official agents, Google said it was "no longer willing to continue censoring" its results.
China thought those allegations were "irresponsible." It led to some tough talk, but it took a while for Google to work up the courage to leave the mainland. The redirect to Hong Kong was an imperfect solution, since the government's filters caused frequent disruptions.
Changing Its Tune
Google's business is ads, and there are apparently just too many eyeballs in China for Google to give them up on principle. The WSJ reports that Google is working on commerce services and product search that will not require official censorship.
Google co-founder Sergey Brin grew up in the Soviet Union, and at the time of the censorship row, he told the WSJ that China's repression reminded him of that past. "I see the same earmarks of totalitarianism," Brin said, "and I find that personally quite troubling."
But now, two years later, China has 500 million Internet users, more than twice as many as the U.S. As Google Asia executive Daniel Alegre told the WSJ, Google is changing its tune on China for "pragmatic" reasons.
Nearly 60% of Chinese smartphones run Android, but they don't have official Google services on board. That's a massive install base just lying there dormant, not even able to access the Android Market for apps. However, assuming Google's acquisition of Motorola Mobility clears, Google will be making money on much of the hardware, anyway.