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Analysis

Google Is Here to Stay

Feb 26, 2018 by The Passage Team
Google Is Here to Stay

The Chinese government hasn’t yet forgiven the tech behemoth for its 2010 anti-censorship stance. But Google seems to have the stamina to stay and work in the Chinese mainland.

A week before the Chinese New Year, Google Greater China (GGC) released a routine Mandarin-soaked video on its social media account. In the video, Scott Beaumont, the President of GGC, wished viewers on this important festive occasion, as he has done every year since taking over the position in 2013. A British citizen, Beaumont had no experience of Asia prior to his current stint. This makes his willingness to make a Mandarin video and managing the Chinese market all the more impressive. You might say that this video, and the attitude that created it, is symbolic of GGC’s current business strategy.

“We are still here”

China’s censorship of online content has kept many global powerhouses at bay, including Facebook, Google, Instagram and Twitter.

Among them, Google has attracted the most attention.

Google’s services were available in the Chinese mainland till it decided to stop catering the government’s content censorship requirement in 2010 and announced to withdraw from the mainland market. This wasn’t surprising, considering the tension brewing between the government and the company, with Google’s tagline Don’t be evil being termed a fig leaf by People’s Daily.

Google pulled out of China. In their defence, few would have imagined that China would become the world’s second largest economy and largest Internet market in less a decade.

In March of 2010, Google used their to state, “We very much hope that the Chinese government respects our decision.” Today, GGC, exhibiting an unusual mixture of humility and haughtiness says, “We are still here.”

That statement, in fact, is GGC’s response to every media inquiry about whether Google plans to go back to China. Technically, Google is still in China. It maintains some R&D work and a sales presence in China and the latter has become its main business in the market.

But its search engine and other products and services, including Google Docs, Gmail, Google Scholar, YouTube and Google Play, are all blocked in the Chinese mainland. Google Translate, however, is doing well. To augment its operations, Google has attended many export-related events in China. Most of its PR content positions the company as the de facto online advertising platform for Chinese companies seeking overseas development. This was evident during a Feb 6th event where Google released a list of the top 50 Chinese brands in overseas markets and showed how Google can help companies get there.

Interestingly, Google may still be the most-favored foreign Internet company amongst Chinese netizens, many of whom use VPN to circumvent China’s firewall and thereby gain access to Google’s services. Therefore, almost every move the company makes in China is viewed with suspicion by some and with anticipation by others. But so far, suggestions of GGC’s true return to the Chinese mainland have been found untrue.

Building a presence

Censorship in China is growing as strongly as the economy. The rose comes with thorns. So with a user base of 1.3 billion and a well-penetrated mobile Internet market, no online company can afford to give China a skip.

Google is no exception. It has to fit in if it doesn’t want to be kicked out.

Instead of publicly blaming the government for censorship and demanding respect as in 2010, Google now makes positive comments on China’s development and even the national strategy.

In the aforementioned Feb 6 Beijing event, Beaumont made the opening speech comparing China favorably with the UK. He said that while other places remained static, China underwent dynamic changes night and day. He also mentioned China’s “Belt and Road” strategy, which serendipitously offers Google’s online advertising business more opportunities in overseas markets.

Scott Beaumont, President of Google Greater China, delivers a keynote speech at “Think with Google” event in Beijing on February 6, 2018. /Google Photo

Google also collaborated with Peking University to publish a research report on “Belt and Road” digital business opportunities.

These moves suggest that the company is determined to stay put in the Chinese market.

The AI gambit

In addition to the “Belt and Road” opportunity,Google is keen to leverage China’s AI upsurge. AI, of course, is a domain of keen interest for the government too. Google’s expertise in AI should ideally have smoothened the relationship between the company and the government. But that hasn’t happened.

Last May, the high-profile match between Google’s AlphaGo and China’s genius Go player Ke Ji attended by Alphabet Executive Chairman Eric Schmidt, attracted loads of attention and raised another round of discussion about Google’s return to China. The government put a quick end to that discussion by halting plans to broadcast the game, live, just days before the event

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(From left to right) DeepMind CEO Demis Hassabi, Chinese Go player Ke Jie and DeepMind scientist David Silver speak to media after the game in Wuzhen, China’s Zhejiang Province, in May, 2017. /Google Photo

Google makes the commitment deeper

In spite of the setbacks, Google is digging deeper and preparing for the long haul.

Several months after the AlphaGo-Ke Jie debacle, Google’s CEO Sundar Pichai made his first appearance at China’s World Internet Conference but did not deliver the keynote speech.

In January 2018, Google opened a new office in China’s Silicon Valley Shenzhen where Tencent and Huawei are also based. This became GGC’s third office, adding to its presence in Beijing and Shanghai.

In the same month, Google and Chinese tech group Tencent signed a long-term agreement to cross-license patents on a wide range of products and technologies. So far, both sides have not disclosed details of the financial agreement or collaboration model. They understandably want to keep a low profile for the partnership.

Doubling down on AI

“AI First” is Google’s strategy in China. The company is promoting its popular AI tools, like TensorFlow.

Getting more developers in China to use TensorFlow will strengthen Google’s connections with local businesses and also demonstrate to the government that and the company’s resources can be tapped to fulfill the country’s AI ambitions.

Google opened its first AI lab in China in December and started hiring local scientists.

“Besides publishing its own work, the Google AI China Center will also support the AI research community by funding and sponsoring AI conferences and workshops, and working closely with the vibrant Chinese AI research community,” Li Fefei, a respected AI veteran and Google Cloud chief scientist wrote in a blog post.

Google’s AI plan in China will face fierce competition as local giants Baidu, Tencent and Alibaba are also pouring money and talents into the field.

Moreover, local players have the support of a powerful government keen to lead the era of AI.

Fortunately, with the development of technology, it becomes more and more difficult for any entity, including China, to isolate itself from the world. So far, though, there is no sign of softening in the government’s censorship policy.

But Li writes in her blog post: “I believe AI and its benefits have no borders.”

Guess what kind of companies love a borderless planet? Companies that look like Google and act like Google.

Yang is a Beijing-based business news freelancer with experience in print/digital media, and PR industry. Believing that Internet makes the world more equal, she keeps a close eye on China’s Internet landscape and related policies. She holds a master’s degree of Intercultural Communication from University of Warwick (UK).

The Passage Team

The Passage is committed to creating in-depth content over technology industry across Asia with a focus on emerging startups in the technology, healthcare, education, food, tech, travel & mobility segments.

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