Google’s Problem In China: Submitted By: Shashank Chauhan

GOOGLE’s PROBLEM IN CHINA

Submitted by: Shashank Chauhan

HISTORY • • • • • •

Founded by : Larry Page and Sergey Brin students of Stanford University, California, USA. Come up with an algorithm called “PageRank” Realized that the search result provided by BackRub were superior than others. Named the search engine Google and released the first version on Stanford University website in August 1996. Co-founder of Yahoo! David Filo encouraged them to start a search engine company. A faculty of Stanford introduced them with Andy Bechtolsheim co-founder of Sun Microsystems.

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He was impressed and handed over a check for US$100,000 in favor of Google Inc. Google opened its first office in Menlo Park, California in September 1998. There after in 1998 they come up in the top 100 search engines. By 2000 Google also introduced a self service advertisement program called Adwords. • In 2002 company comes up with an agreement with AOL to which Google will provide search results and AOL placed banner advertisements from Google on its website. • By February 2004, Google expanded its web index to around six billion items. On 29 April 2004 filed an application with US Securities exchange Commission (SEC) for initial public offering & raise US$1.2 billion in August 2004.

INTERNET in CHINA (REGULATING BODIES) • Internet in China is guided be complex laws and regulations. • Ministry of Information Industry (MII) operates networks to connect to the global internet. • The legal regulation comprises prohibitions issued by multiple bodies:  Central Propaganda Department, Department of Commerce  Department of Telecommunication  General Administration of Press and Publication (GAP)  Ministry of Culture, Ministry of Information Industry  Ministry of Public Security  Public Security Bureau  State Administration of Radio, Film and Television  State Council Information Agency  State Secrets Bureau

FORBIDDEN SEARCHS IN CHINA •     

Chinese government does not allow the free access to various contents like: Tiananmen Square Tibet Independence/ Dalai Lama Falun Gong Political Status of Taiwan Human Rights

GOOGLE in CHINA • • • •

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Began its operation in September 2000 by offering 24 million web pages in Chinese language. By 2002 gained lot of popularity. By 2003 Google ranked #1 with share of 34.8% In September 2002 government was installing a new filtering software containing specified words. They installed this software in four public access networks that blocked GOOGLE. REASON: Users of Google was accessing the restricted pages by government through cached pages. There by the search speed drastically goes down and sometimes not even accessible.

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In September 2004 Google launched Google News, by November 2004 Chinese authorities blocked the news in English.

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Thereafter Google was unreachable 10% of the times.

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Elliot Scharge, Vice-president, Google communucation and Public Affairs said “Google was seven times slower than its competitor Baidu”.

MARKET SHARE • • •

Google was continuously loosing market share. In 2003 Baidu’s share was 2.5% of the internet search market. By 2005 Google’s share was below 30% while Baidu’s share in the market was 46%. MARKET SHARE (%) BEIJING IN JUNE 2005

MARKET SHARE (%) SHANGHAI IN JUNE 2005

MARKET SHARE (%) GUANGZHOU IN JUNE 2005

GOOGLE COME BACK •

Because of lucrative market and size Google wanted its major presence in China.

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Google felt only its local presence in China could provide a better and more reliable service and for that they need an Internet Content Provider license.

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In April 2005 they got the license and Google announces its opening of representative office, R&D and registered URL- www.google.com.cn

FILTERING & GOOGLE •

Filtering search result was against Google’s policy but in order to capitalize market they have done that. • ANALYST POINTS OUT: • They pointed out that not only in China Google had done in other countries also:  GERMANY : Google followed the orders of government in restricting references to site that denied the Holocaust.  FRANCE : sites that encouraged racial hatred were prohibited.  UNITED STATES : US practiced censorship to Digital Millennium Copyright Act and Google assisted the authorities in checking copyright infringements. “What’s important to users is access of information, we’re giving them that, and we think that’s the most information. We’d like to give to give all the information, but we just can’t.” -Peter Norvig (Director of Research, Google)

LAUNCH OF GOOGLE.CN •

In January 2006 google.cn was officially launched.

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Google maintained its stand on protecting user policy.

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Thus modifying its search capabilities according to Chinese government gives Google to access one of the most lucrative market in the world.

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After the downfall of market share it will be tough to regain market share

WEBSITES NOT LISTED IN GOOGLE.CN Website

Type

Bacardi.com

Alcohol

Bignews.org

News

Chinesenewsweek.com News Collegehumor.com

Humor

Date.com

Dating

Falunasia.com

Advocacy

Funnyjokes.com

Humor

Hightimes.com

Drug Use

Hrw.org

Advocacy

Libertytimes.com.tw

News

Mm52.com

Entertainment

Netfirms.com

Webhosting

WEBSITES NOT LISTED IN GOOGLE.CN Website

Type

News.bbc.co.uk

News

Omnitalk.com

Community

Sonicnet.com

Music

Time.com

News

Voa.gov

Government