Google may cease Chinese operations on April 10th

by: Bradley Wint on March 20th, 2010 at 2:09 am

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In a report by China Business News, Google may pack up its Chinese operations by April 10th 2009. This means that they most likely pull their www.google.cn domain down and shut down some of its physical operations in China. Back in January 2010, the Chinese government put severe pressure on Google to provide purely filtered content to comply with China’s strict Internet regulations. However Google wasn’t happy with their call and wanted their content unfiltered. If they couldn’t get that demand satisfied, they said they would have to pull out. Also, attacks on their GMail service seemed to have originated from colleges closely affiliated to the Chinese government, adding to their decision.

Even with China contributing a significant figure of traffic to Google (currently the 14th most traffic site on the web), they are still adamant to pull out. The report mentioned that Google may announce an exit strategy next week, and offer employment to its staff in US and other Asian/Pacific offices. However, others have mentioned that Chinese employment laws have actually worked positively for staff members, allowing almost all of them to keep their jobs. This is so because Google has a joint venture with a Chinese partner. The law states that foreign corporations are not allowed to have majority control over Internet based organizations in cases of joint ventures. The interesting thing about it is that almost all the employees are under a totally different company called Google Information Technology (China), which is wholly owned by the parent company. This means staff members can keep their jobs, even if the google.cn domain is shut down.

Why would they want to keep their jobs other than needing a monthly paycheck? Google’s global services extends far beyond just searching the web. They manage advertising accounts, translation services and much more. Google can definitely keep these staff members occupied in other areas.

So what’s in the future? Google says that they will most likely shift the services from the local based engine to the google.com domain and hope they the government doesn’t block that domain completely as well. With a 35% Chinese stake hold in the search engine business, they would prefer to keep things on a positive note. However, Google’s arrogant approach may ruin their chances for any re-entry at a later date (regarding google.cn domain). Google posted a bit of commentary about their new approach to the Chinese situation, which you can read here.

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