Welcome back to Fact or Fiction. In case you missed it last time, it is an (ir)regular feature here on Lost Laowai. Every edition I will have a guest and we will discuss a few of the big issues in China of the day. Every answer will have a “Fact” or a “Fiction” and some justification to go along with it.
Today, like much of the blogosphere we will be talking about the Google vs. GFW debate.  Which makes my guest, Steven, the perfect counterpart. The current resident of Suzhou, writes here at Lost Laowai and most of his posts have a technological theme. He is also the sole China blogger for CNET Asia with his blog Sinobytes.
So without further ado, let’s get down to Fact or Fiction 2:Â Electric Googaloo!!!
Welcome back to Fact or Fiction. In case you missed it last time, it is an (ir)regular feature here on Lost Laowai. Every edition I will have a guest and we will discuss a few of the big issues in China of the day. Every answer will have a “Fact” or a “Fiction” and some justification to go along with it.
Today, like much of the blogosphere we will be talking about the Google vs. GFW debate.  Which makes my guest, Steven, the perfect counterpart. The current resident of Suzhou, writes here at Lost Laowai and most of his posts have a technological theme. He is also the sole China blogger for CNET Asia with his blog Sinobytes.
So without further ado, let’s get down to Fact or Fiction 2:Â Electric Googaloo!!!
1. If Google does leave China, more companies will follow them
Glen: FACT
Doing business in China has been seen in recent years as a necessary evil to compete on a global scale. As such a number of corporations have had to make certain sacrifices in order to make that happen. However, here we see a large company flat out saying no. In business, one of the sure fire ways to profit is to simply do whatever profitable people are doing. Google is one of the most profitable companies on the planet, and surely other companies will join them in their protests against the Great Firewall. Whether they are motivated by altruism or profit is another debate.
Steven: FICTION
Google was always going to be in the tightest spot when operating in China: a new media company whose motto is ‘Don’t be evil’ doing business in a country where free-flowing information is seen as an ‘evil’ threat to national stability. And although I’m not convinced that Google’s motives are genuinely pushing forward a freer environment for search and new media (what’s Google China’s $300mil out of Google Inc.’s $22 billion annual revenue), I’m convinced that no other companies will follow Google, if Google China is indeed shuttered. There are already some significant concerns for companies coming to operate in China: getting ripped off in your joint-venture, lack of intellectual property protection, internal spying, corruption, and the general ‘brown envelope’ culture of doing business – those same, wider issues will remain whether Google leaves or not.
0 for 1 to start. Funny considering just how jaded both of our answers were.
2. James Fallows was right, this is China’s Bush-Cheney era
Glen: FACT
Let’s see: flexing their muscle on the international scene. Check. Limiting the rights of their citizens while trumpeting freedom. Check. Upsetting the world in the process. Check. A large loyal following of people whose most intelligent answer to criticism is “If you don’t like it just leave”. You better believe that’s a check. We’re just some electoral fraud and a housing collapse away from being able to yell “BINGO!”
Steven: FICTION
The amount of civil liberties that the Bush-Cheney era infringed – most grossly: wire-tapping their own law-abiding citizens, one illegal war, and one Geneva convention-defying detainee camp – means that you’d have to be a tin-pot dictator to come close to the Cowboy/Face-shooter duo. More accurately, China has new found confidence backed up by wealth – a few trillion of it being US dollars – so the authorities are getting into the swing of throwing their weight around a bit, but nothing more.
0 for 2! I would be mad except “Cowboy/Face-shooter duo” is too awesome of a summary for the diabolical duo to be mad at.
3. Google will end up investing in a Chinese web start up if they do leave
Glen: FICTION
I think that their dealings with the Chinese will be heavily scrutinized after this, and any investment in some Chinese web company would be seen as “being evil” and bad for their corporate image. As much as the cynic in me thinks that’s what they will do, the other side of me thinks that it won’t happen.
Steven: FACT
China may be a small piece of the pie right now for Google, in terms of desktop and mobile searches, and ad revenue, but that can only grow in future – especially mobile ad revenue, a market that’s only now kicking off in China. Perhaps investing in a few start-ups here across those three key sectors – social networking might be best avoided – might be the best/only way for Google to keep their thumb in the pie, without their name being plastered all over the product.
Still in disagreement 0 for 3. Time to switch!
4. The WTO will investigate the Great Firewall as a trade barrier
Steven: FACT
Oh, I do hope so. But, really, think about the YouTube blockage as being a tariff on steel, beef, or tyres (sorry, ‘tires’), then you’ll realise that the WTO and world governments have been curiously quiet about Net Nanny stamping on so many foreign websites here. If you add up all of the lost revenue of Facebook, Youtube, and Google’s various web apps, it surely amounts to hundreds of millions of dollars. And, to be frank, WTO intervention is our only hope of the Great Firewall being trimmed down. But don’t expect it to be knocked down.
Glen: FICTION
As much as I would love to see this happen, I just don’t see it in the cards. If the WTO plays hardball with China, what will happen next? Will China just leave the WTO? Then who would that hurt more? A Trade Organization that doesn’t have the world’s largest exporter is about as legitimate as an emissions agreement without the world’s largest polluter (see: Protocol, The Kyoto). Sadly, I think that we are reaching a point where the WTO may need China more than the other way around.
Interesting points of view on this one, I’d be interested in what those of you in comment land have to say. 0 for 4 though still.
5. Google knew what they were getting into when they opened an office in China, and does not deserve sympathy.
Steven: FACT
I’m a huge admirer of Google in general, and a big user of their web apps, but on this issue I can only say: If you jump into the lion enclosure, don’t be surprised when you get bitten on the ass.
Glen: FACT
I couldn’t agree more my friend. They knew the Chinese laws before they opened up their offices here.  While I wish that things were turning out differently for them, it’s hard to really see a shock here. If you play with fire you will get burned, if you play with China you will be censored.
And we finally have some agreement! I guess nobody has Sympathy for The Devil Google. 1 for 5.
6. The internet situation is the biggest drawback of living in China
Steven: FACT
People? Awesome. Food? Gorgeous. Culture? Fascinating. The internet here? Don’t even get me started… Well, to avoid all the swearing and a raising of one’s blood pressure, a VPN is as essential as a visa now. It may double the cost of getting online, but it’s better to have the full internet than the sad, messed-up, Net Nanny-approved intranet that exists since last summer.
Glen: FICTION
I was all set to answer fact on this one, but then I remembered something that is, for the time being, worse. The availability of health care. While I have thankfully never been to the hospital here, I have heard some horror stories of people who have. I know that this is getting better all the time, while the censorship seems to be getting worse, but for the time being I’d put the GFW in a close second on this undesirable list.
And that concludes it. 1 for 6.
So as always, we’ve got to turn it back to all of you out there. Thoughts? Comments? Concerns?
For me…
1. Fiction
2. Fact
Flexing muscles, yes. But not as radical and blind-sighted as GWB.
3. Fact
Of course they will. What Multinational Organisation doesn’t want a slice of this pie that is China?
4. Fact
They will “launch an investigation” but it’s most likely nothing will come out of it. So basically will end up like what Glen said.
5. Fact
No sympathy for any large for-profit organisations.
6. Fiction
To me, pollution and the lack of social security system are far bigger drawbacks.
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I’d completely agree with you but for one thing; you didn’t specify whether by “living in China” you meant “expat living in China” or not.
Healthcare for your average Chinese person is certainly way worse than filtered Internet access. However, as most of us expats have access to decent (and pricier) healthcare alternatives, and many of us have some sort of health insurance, I’d put the GFW as a bigger pain.
Add to this that your average Chinese Internet user likely doesn’t care nor notice the lack of access to Youtube (they’ve got Youku), Facebook (they’ve got Kaixin/Xiaonei/etc.) or Blogger (they’ve got Sina and company) — it’s almost a non-question if directed to the population of China at large, I’m sure there are a lot of things they would complain about before the Internet when it comes to living here.
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Whether Google deserves “sympathy” or not, I don’t know, but knowledge of Chinese Law does not equal anticipating government coordinated hacking for the purpose of incriminating dissidents.
Google was hacked by the Chinese government, so they’re not so keen on playing nice anymore.
Is Google supposed to anticipate that? Is that “the cost of business” in China? Is there anything that the Chinese government could do that would be beyond the pale?
Apparently in your book, using a company to persecute dissidents is not.
@Ryan I’m not sold on the Chinese Hospitals. I know that there are some great (very expensive) ones in Beijing and Shanghai. However, that seems to drop off in any of the second or third tier cities. I mean, here in Suzhou there are all sorts of people who have to go to Shanghai for major things. While it isn’t that far away, it could be far away in an emergency. And this says nothing for more remote parts of the country where I’m sure the medical facilities are a lot worse. If given the choice between one improper medical procedure done on me and a lifetime of not being able to Twitter, I think I know what I would would pick.
@nate Apparently China has by far the largest “cyber army” (I’m sorry I do hate that term but I don’t know any better ones) in the world. Do you think that this was the first time that they hacked Google? I mean, they have kept tabs on a lot of overseas dissidents before, and I’m sure a lot of their information must have come from some sort of hacking. I know that I’m speculating here, but it seems kind of strange to think that hundreds of thousands of “cyber soldiers” would wait four years to strike their most obvious target.
Also, it’s not like Google shouldn’t have known that this was some sort of a risk before entering into China. I mean, you wouldn’t search for Diamonds in the Congo if you didn’t anticipate some sort of hostilities, so you can’t be an internet company in China if you’re not expecting the same.
You know, being in a small city, I don’t have access to flash foreigner private hospitals. I’ve just used the same hospital all my friends use and whilst it is different to what i’m used to, they have always looked after me well. Compared with Australia, much cheaper, quicker and more thorough.
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“Google was hacked by the Chinese government”
@nate,
That´s a pretty bold statement. Care to back up that with any proof?
@Lars: I’m only restating what Google said, just in slightly starker terms. They know how the internet works as well as anyone, and are no slouches when it comes to business either. They did not make the accusation lightly, and Hillary Clinton did not call for an explanation because some pimply netizens shoulder-surfed some dude at a net cafe.
@Glen, thanks for the response. I agree that hacking is part of the cost of doing business like Google’s. And again, I don’t think that Google is reacting to run-of-the-mill stuff here. I think the question stands though, at what point does a sovereign nation go too far? Do we hold China to such a low standard that the Congo is an apt comparison? Perhaps Hillary Clinton’s Tunisia and Uzbekistan was apt, and not just a taunt.
@nate,
Yes, I note you restate that what Google says is an indisputable fact. I don´t make that conclusion as I haven´t seen any proof for it, neither do I believe what the U.S. or Chinese governments says either, I just notice there are different versions of what has happened and the jury is still out.
As for Google “knowing how the internet works as well as anyone, and are no slouches when it comes to business either.” I don´t either make the same conclusion at this point. Have you e.g. read these?
http://blogs.forrester.com/srm/2010/01/update-google-calls-and-confirms-the-vpn-story.html
http://blogs.techrepublic.com.com/security/?p=3007