On January 4 we broke the story about Google backing down on their online censorship position in China. Sometime between December 5 and December 8 last year, Google decided to remove a feature which had previously informed users from China of censored keywords. At the same time, they deleted the help article which explained how to use the feature, indicating a new development in the relationship between the Chinese government and Google.

Our original article warrants further elaboration and analysis and we also felt it necessary to address some issues raised by the media who reported on this story.

Is this about making Google shareholders happy?

Is this just another China growth story? This could be the simplest answer as to why Google would make such a change and it would have been hastened by the Chinese government’s decision to block Google for one day last November.

Despite reports otherwise, Google still maintains offices in China and still does business here. Google is selling advertising to clients in China despite the fact that a small percentage of Chinese use Google for search. But that small percentage translates to a higher number of internet users because of the total size of China’s online population (over 500 million). This equates to perhaps over USD 1b in revenue on an annual basis (based on 2010 numbers) - not bad for a service that has faced significant hurdles. This is comparable to revenue generated by markets like Canada which see total annual revenues around US 2b. Google has global clients that also advertise in China and need to be served and Chinese companies who want to market themselves globally. If Google search is closed down and Adwords are not being delivered, it surely creates some unhappy customers.

The company also can claim many business customers who use Gmail to power their corporate email. Any interruption in service makes for a host of uneasy CEOs and CTOs who are worried that essential communication infrastructure could collapse.

Risking harming relations with major global clients because of China hiccups would also mean risking a huge chunk of revenue tied into global accounts. Clients would prefer to have a global integrated solution but that means nothing when nobody can or is accessing your site.

But most importantly, even though Google holds a small market share in China, this still generates substantial revenue for the company. This additional revenue surely makes shareholders who are looking for new Google growth stories happy. So Google felt it necessary to placate shareholders even if it meant that they would have to bow down to Chinese government censors. Of course, they are not the first foreign company to do China’s bidding in order to gain market access and they won’t be the last. If there was a scale of magnitude for measuring Google’s actions against other foreign company capitulations in China they’d be at the lower end. After all, Yahoo shared the private emails from well-known dissidents with the authorities in order to gain further access to the China market. In the end, Yahoo’s internet moves in China resulted in a fire sale while several dissidents went to prison.

Is this about providing a better user experience?

Wired have argued that Google have made the decision to improve the user experience. We’d vehemently disagree with that notion and believe in the contrary. By letting users know that the search they are about to conduct is going to be censored, Google actually improved the user experience and provided an out for users before they would receive error messages. This also helped to condition Chinese internet users as to what they should and should not be searching for which arguably also played into the hands of the Chinese censors lest they be subject to a 60 second connection reset. Surely this is a better solution than the one provided by sites like Sina Weibo who experimented with delivering a “0” result when users search for a blocked term. Do Sina Weibo users really believe that there are no search results for the President of the country as had happened earlier last year?

With Google backing down, does this mean that China will be successful at controlling information?

If Google stops pushing, or pushes less, it does make it easier for the authorities to control the Internet because one big public voice of opposition is taken out of the game.

Gmail, however, is still a problem for the censors because it continues to provide an encrypted mail service. The Chinese government strategy of slowing Gmail down in an effort to pressure users to switch to other, unencrypted email providers is likely not working so it would not be surprising if China puts even more pressure on Google and Gmail by slowing the service down further or implementing occasional blocks (like it has in the past). It is doubtful a tit-for-tat agreement has been made between the Chinese government and Google on this matter and even if the Chinese government made some sort of agreement not to block Gmail this would likely only be a short-term promise until another issue (or Party Congress or high level corruption case, etc.) arises in the future and changes the rules of the game.

Many well-financed foreign and domestic entities are also working around the clock to develop new circumvention tools. You need only witness the cat and mouse game being played between VPN providers and the Chinese authorities. No sooner is one channel blocked than another is opened. The VPN providers are winning this battle with some minor inconveniences along the way, but it is unlikely that China will ever succeed at fully shutting down circumvention tools.

But Google’s quiet exit from the censorship game in China could herald the arrival of a much more powerful and important voice of opposition – China’s netizens and domestic media organizations. Our breaking of the Google story generated decent media exposure in foreign press but nothing compared to the outcry that occurred over censorship at Southern Weekend only two days later. Supporters of the media publication were vocal on social media and when their messages started to get deleted then sent more messages, generating their own levels of encryption by writing cryptic poetic prose which would evade any straightforward keyword block yet still carry a painstakingly obvious message.

China has a long history of not instituting change when foreign powers have insisted that change is necessary. No country likes to be told what to do and China is no exception. With Google out of the picture and no obvious foreign successor to the anti-censorship throne, the title is now open for a Chinese heir and it would make sense that an influential media organization like Southern Weekend would move into this territory. And whatever the result of the standoff, these two incidents could very well spell the beginning of the end for online censorship in China. An endless stream of China experts have long predicted that social instability is a major political risk for the Chinese government. But when this train gets moving, fueled by social media, it will be hard to stop. Other Southern Weekends will take up the anti-censorship throne and if they are defeated yet others will move into their places. When all daring Chinese media organizations have been silenced in China, individual voices will start to rise and once that happens (and it could be argued that it already is with the Southern Weekend incident) there will be only two options left for the Chinese government: flip the off switch on mobile and internet communications or let the escaped animal roam free.