Google-China: A Temporary Cease-Fire on Censorship

Now it becomes a waiting game.

Google got to keep its foot in the Chinese market after the authorities in Beijing on Friday agreed to renew the company's license to operate in the country. In doing so, the government made sure that it didn't lose face in announcing the decision. Also note that Google didn't wind up embarrassed either. To be sure, Google can't automatically redirect people using its google.cn sit to an unfiltered Chinese language site. But the government did agree to Google instead offering a link on the google.cn homepage to a company-operated Hong Kong site.

In a post on ZDNet, Christopher Dawson correctly noted that this market was just too big for Google to abandon. Even though China-related revenues were paltry - about 1% of Google's sales - the bigger picture told the story: More people in China use the Internet than anywhere on the planet. (Wall Street predictably rallied on the news.)

"We are very pleased that the government has renewed our ICP license and we look forward to continuing to provide web search and local products to our users in China," the company's chief legal officer, David Drummond, wrote on a Google blog.

Nothing there about the rights of individuals to privacy protection. If you believe compromise is a dirty word, this translates into a sell out. But this is the real world. As China continues to evolve, the company is betting that the winds blow in the direction of reform. Only then would Google would be able to operate without being forced to play cat-and-mouse.

Many would argue that's a reasonable assumption but  we won't know how that gambit turns out for quite some. And so it boils down to a matter of wait-and-see.

Free speechers are not going to like the deal. On the surface, the decision to take a half in, half out approach does not square with the public statements by Google's co-founder Sergey Brin regarding Internet censorship and totalitarianism. For a company pledging not to do evil, Google is vulnerable to criticism that it has failed to live up to its professed principles. So it is that Dana Blankenhorn argues that nobody covered themselves with glory here - including the U.S. government's public silence in the matter.

For U.S. tech companies, that's probably the most troubling takeaway of this affair. Whatever backroom negotiations took place, Uncle Sam was noticeably missing. And since this license comes up for renewal in another year, Google and China may be back at it yet again..

But for the time being, everyone gets something. This was a compromise. China didn't want to cut itself off from one of the most innovative companies in Silicon Valley. And If Google was going to get a piece of the world's biggest online market, management was going to have to bend its head ever so slightly in order end the standoff. And that's what happened.