Google: a data-liberation army?
Google’s passion for the free flow of information, including in China, is based on business interests and naive politics.
When Google, the behemoth of global connectedness, and China, the behemoth of global economic growth, confronted each other over the free flow of information in China, there was only ever going to be one winner.
When Google entered the Chinese market in 2006, it believed that even a self-censored version of its search engine would provide Chinese people with more access to information and help promote free expression. But the search company came up against an authoritarian Chinese wall that has remained immovable. In explaining Google’s decision to move its Chinese search engine to Hong Kong, Google co-founder Sergey Brin revealed that increased government censorship was only part of the reason for leaving. He described the recent orchestrated cyber attacks from within China, when some of Google’s proprietary computer code was stolen, and attempts to intercept Chinese activists’ emails, as the ‘straw that broke the camel’s back’.
While many internet freedom proponents are cheering Google’s decision to quit China, there is much confusion within the media and business worlds about the move. Those who cheer Google on for taking a brave stance against China misunderstand the relationship between Google’s moralism and its business logic. Liberal media commentators, including Timothy Garton Ash of the Guardian, have applauded Google for allowing the spirit of ‘liberal universalism’ to triumph over hard-headed commercial opportunism, apparently believing that it is mainly up to Google, rather than the Chinese people, to liberate China from ‘information distortion’.
On the other side, those who say Google’s decision had purely economic motives get it equally wrong. Many commentators have pointed out that Google wasn’t doing very well in China anyway, and cynically suggest that it can afford to moralise about Chinese censorship as its losses are relatively trivial anyway. According to iResearch, a Chinese consulting firm, the largest search engine in China is Baidu, with 300million visitors, a market value of more than $15billion, and 63 per cent of internet search revenue in China. Google lags well behind with just 33 per cent of search revenue. Analysts estimate that Google gets only one to two per cent of its global revenue from China, between $250million and $500million last year.
Both Googlistas such as Garton Ash, who project their own liberal sentiments on to Google, and the cynical economists are missing two fundamental points. First, as small as Google’s revenues in China might be today, the company could have earned much more in the future. China’s internet market is already the world’s largest, even if its revenue capacity remains paltry. That revenue will increase substantially as living standards rise in the coming decades. So Google’s decision will no doubt hurt a lot financially in the long term. But the evidence is already there: the huge Chinese web portal, Sina, along with China Mobile, China Telecom and China Unicom have all announced plans to end partnerships with Google or to remove Google search applications from new handsets. Indeed, the future of Google’s Android operating system in the Chinese market is now under serious threat.
Second, while Google executives probably anticipated the loss of these commercial opportunities, the company’s moralistic justification actually masked an even bigger economic issue: namely, the hacking of its systems and theft of some code which appears to have been orchestrated through the Chinese military. Google could have lived with the censorship; the hacking was the real problem. Google’s assets rest upon its intellectual property and the ephemeral trust its users have in their data being secure on Google’s platforms and servers. If users’ trust is jeopardised in any way, if Google is seen to be vulnerable to hacking or to security breaches, it no longer has a viable business, because users would migrate to other services in droves. What happened in China represented a threat to Google and to its customers around the world.
Google is quite different to most large global corporations in the digital era. Its operations and reputation rely on the free flow of information and data, and on the trustworthiness of its applications and services. It’s not just that users expect their data not to be hacked or stolen – every time they log into Gmail or any other platform-based application, they expect their data to be available on demand and that the service will work, be fast and reliable. The content of Google’s business – the free flow of data and information across the web – means that the internet is effectively the operating system underpinning its business. If this operating system is jeopardised or compromised in any way, Google ceases to exist.
This is both Google’s strength and its weakness, and explains the relationship between its often-misinterpreted evangelism about openness, the free flow of information and its business model.
Unlike Microsoft, which Google is now increasingly being compared to as the new ‘Big Satan’, Google cannot control the platform that underpins its business and upon which all manner of competitors can easily innovate. Microsoft built its considerable wealth and market position on proprietary software, which locked users in and kept competitors out. Google cannot operate in this fashion (even if it wanted to). With the internet as its operating system, Google is tied to an open end-to-end architecture.
As Peter Barron, Google’s director of communications for Northern and Central Europe, explained to me last week, the only basis for ‘locking’ users in to Google applications or services is by providing the best-of-breed services users want. To stress this point, Barron highlighted the existence within Google of the ‘Data Liberation Front’ – a dedicated team of Google engineers building systems to allow customers to take their data away from Google if they want to cease using the company’s services. This shows how sensitive Google is to its relationship with customers.
There are many emerging services that pose a competitive threat to Google, for example real-time search applications like Twitter. Indeed, the clumsy launch of Google Buzz to counter the growth of Facebook revealed an unfamiliar sight: Google under pressure. Buzz had some serious privacy loopholes, which angered many of Google’s faithful users. Uncharacteristically, Google put its business plan concerns before the needs of its users and paid the price all companies pay when behaving in this fashion: after a lot of hype, Google Buzz has been a flop.
The most disarming thing about Google’s staff is their passionate belief in what they are doing as a business. The internal company philosophy is ‘Do No Evil’, but, as Peter Barron explained to me, it’s not so much about harm-avoidance as many in the media would have it – the slogan is not a public mission statement. Rather, it expresses a passionate belief in the free flow of information and free speech being intrinsically good for society. On that basis, Google is inherently good for the world, but those who run it are also very pragmatic and astute businesspeople; the company’s commercial interests depend on the free flow of information. From this point of view, Google’s decision to quit China was inevitable.
In these cynical and jaded times, where apparent ethics and principles in business are regarded as a cynical front covering up dodgy dealings, Google increasingly attracts opprobrium rather than praise for its stated beliefs. Certainly, speaking to Google employees, who often come across like born-again Christians, can be grating. But a strong belief in the power of the internet and the opportunities it can offer for humanity is woven into Google’s fabric. It is not just another tired company ‘value’. Google’s moral profile and its size attract cynicism and scepticism as well as praise: Google has become a blank screen upon which others can project all manner of self-serving opinions.
However, Google itself is not entirely blameless for this confusion. If there is one accusation that could be levelled justifiably at Google, it is that the company’s decision to go into China in the first place was tinged with a degree of political naivety. The decision created a huge debate within Google, which Peter Barron assures me is still raging. In testimony to a sub-committee of the US House of Representatives in February 2006, Google’s then vice president of global communications and public affairs, Elliot Schrage, made the point that Google’s decision ‘was based on a judgment that Google.cn will make a meaningful – though imperfect – contribution to the overall expansion of access to information in China’. This represented a reasonable and pragmatic recognition that Google would have to make some compromises in order to get a foothold in one of the fastest growing markets in the world.
The naivety stemmed from how Google, in its moralistic zeal, argued that the drive to open up the internet should form part of the foreign policy of the US government. At the end of his testimony, Schrage stressed that the US had a role to play in contributing to the global expansion of free expression and urged it to make tackling censorship a central element of America’s bilateral and multilateral agendas. Indeed, Schrage went even further, urging the government ‘to bolster the global reach and impact of our internet information industry by placing obstacles to its growth at the top of our trade agenda. At the risk of oversimplification, the US should treat censorship as a barrier to trade, and raise that issue in appropriate fora.’
This was a gross oversimplification. Impassioned by the belief that even a stunted Google could counter censorship in China, that the US’s ‘internet information industry’, supported by the US State Department, would somehow breach or bring down China’s Great Firewall, was pure childish fantasy. This is not the comic-book realm of good vs evil, but the world of global politics where the rules are determined by a hard assessment of national interest. China will not crumble in the face of thousands of Google searches for ‘Tiananmen Square Massacre’. In this arena, Google’s ethics, moralism and business model are small potatoes. The weakness of Google’s position, its dependence upon the openness of the internet, was no match for the Chinese bureaucracy.
In turning to the political arena as a way of trying to overcome that weakness, Google showed itself to be naive. More worryingly for the long term, the company made itself an extension of US diplomacy, a relationship that could spark even greater fears amongst Google’s loyal user base in the West. That relationship could create the basis for a future breach of trust that could come back to haunt Google one day.
Previously on spiked
Andrew Orlowski said we’re all in Google’s crossfire. Rob Killick called Google a frenemy of the internet generation. Back in 2004, Sandy Starr said Google was being slated and feted for the wrong reasons. Elsewhere, he criticised the publishing industry for stalling Google’s attempt to create a virtual library. Tim Black examined an Italian court’s desicion to sentence Google executives for privacy infringement. Or read more at the spiked issue Innovation.