Zenaida A. Barredo
Professors Dhiman, Matzen, Allevato and Cheng - Levine
WMBA 5707
February 1, 2012
Gaining Familiarity-Google, Inc. is the most popular and successful web based search engine in
the world. The company places product differentiation and upholds “neutrality” on its priority
list that brought tremendous market and financial success domestically. But along came threats
and competition from equally successful companies such as Microsoft, Yahoo and “Meta” search
technology. Although Google was able to achieve billions in net profit margin of 25.18%, the
company began to focus on its global markets where majority of the searches originated but was
responsible for only 34% of its 3.2 billion revenue in 2004. When Google introduced a Chinese
language version of Google in early 2000 its main goal was to handle search requests originating
within China but housed it in the United States to avoid government censorship and the need to
obtain a license to operate a business from the Chinese government. The operation went on
smoothly for the next 2 years allowing users to see unfiltered list of information on their searches
including information that the Chinese government considered threatening. The uncensored,
unmonitored flow of information went on until September 2002 when the site became
inaccessible for two (2) weeks and when service finally returned, it became seven (7) times
slower than the leading Chinese search engine “Baidu” (Schrage, 2006). It was in 2004 that
Google finally acknowledged that drastic changes were needed to make the Chinese language
version search engine become sustainable.
In order to create a business relationship with China, Google, Inc. invested of $5 million for a
2.6 % stake in “Baidu”. Consequently, Google created a faster, reliable search engine Google.cn
(upon Tom MacLean’s - Director of International Business at Google, Inc. decision) in January
2006 which was housed in China and subject to its filtering and monitoring laws that excluded a
“handful of politically sensitive subjects”. In order to maintain its product and/or service
differentiation, the company (Google) resulted to the following courses of actions: (1) keeping
personal information outside China through Gmail (web based email service) and Blogger
(personal Web-blog-hosting service), (2) disclosing the presence of general filtering to users and
(3) continuing a Chinese-language version of Google.com (Schrage, 2006).
Never the less, in spite of China’s strict censorship, Chinese users were still able to leak
information out of their country using proxy servers located outside China through use of
anonymizer programs, traditional exchange on information such as by word of mouth,
underground newspaper and radio.
Recognizing Symptoms - When Google experienced a two week block out of its Chinese
language search engine and a significant increase in downloading time for any requested
information marked the beginning of bigger issues that will inflect Google’s operation and
reputation.
Although Google, Inc. was able to address its concern on China’s strict enforcement of
information censorship and delivering a fast search results through capital investment in “Baidu”
and consequently obtaining a license to operate locally in China, it caught a tremendous media
attention from different and displeased public, non-public figures and organizations which
culminated to a U.S. congressional hearing on February, 15, 2005.
In China, there are several issues that plague Google’s.cn (Schrage, 2006):
1) The most pressing is that personal information of users using a China based
web servers are still subject to requests for information by the Chinese
government.
2) Keeping personal information thru Googles’ Gmail and Blogger do not
guarantee user’s privacy and confidentiality.
3) The filtering notification although provided does not disclose the exact nature
of filtering.
4) The censorship imposed by the Chinese government limits the information
available to the users.
Identifying Goals
As spoken by Elliot Schrage vice president of Global Communications and Public Affair
for Google, Inc. (2006) :
“Google, Inc., faced a choice to) compromise our mission by failing to serve our
users in China or compromise our mission by entering China and complying
with Chinese laws that require us to censor search results…Based on what we
know today and what we see in China, we believe our decision to launch the
Google.cn service in addition to our Google.com service is reasonable one, better
for Chinese users and better for Google… Self-censorship, like that which we are
now required to perform in China, is something that conflicts deeply with our
core principles… This was not something we did enthusiastically or something
that we’re proud of at all.”
He further stated that Google has made its decision based on balancing its
commitment to user interests, access to information, and responding to local
conditions:
“The requirements of doing business in China include self-censorship-something
that runs counter to Google’s most basic values and commitment as a company.
Despite that, we made a decision to launch a new product for China-Google.cnthat respects the content restrictions imposed by Chinese laws and
regulations…our 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.”
Schrage acknowledged (2006):
“(Don’t be evil is) and admonition that reminds us to consider the moral and
ethical implications of every single business decision make…We believe that our
current approach to China is consistent with this mantra.”
Andrew McLaughlin, an attorney for Google, stated (Langberg, 2006):
“While removing search results is inconsistent with Google’s mission, providing
no information…is more inconsistent with our mission.”
These statements from various Google, Inc. executives clearly illustrate their company’s goal
that is - to focus more on their global strategy and to increase its revenue from international
searches.
But on the other hand, the US congress’ goal was to examine if indeed Google, Inc. supports a
country that is known for its numerous human rights violations, and whether it failed to follow
ethical standards that any US company are subject to and with respect to human rights as
presented.
According to the testimony of James Keith (2006), senior adviser for China and
Mongolia in the State Department’s Bureau of East Asian and Pacific Affairs
before Congress:
“China’s well –documented abuses of human rights are in violation of
internationally recognized norms, stemming both from the authorities’ intolerance
of dissent and the inadequacy of legal safeguards for basic freedoms. Reported
abuses have included arbitrary and lengthy incommunicado detention, forced
confessions, torture and mistreatment of prisoners as well as severe restrictions on
freedom of speech, the press, assembly, association, religion, privacy, worker
rights, and coercive birth limitation. In 2005, China stepped up monitoring,
harassment, intimidation, and arrest of journalists, Internet writers, defense
lawyers, religious activists, and political dissidents.”
Chinese Government’s goal is to maintain self-censorship, control information exchange to and
from Chinese users, strict implementation of Chinese laws and regulations.
Conducting Analysis – Google’s desire to maintain product differentiation, its presence in China,
and be on the cutting edge in a highly competitive market, Google.cn was introduced in 2006.
Google.cn operation runs well, the company recognizes the strict implementation of China’s
governmental and self-censorship as demonstrated by having 30,000 internet police, positioning
routers at the edge of the domestic Internet, cyber-cafes self censorship, enhance fear and
intimidate possible violators thru negative propagandas about imprisoned journalists, encourage
Chinese citizens to report “harmful” information, vague and continuously changing definition of
“harmful material” (Martin, 2007).
In its effort to protect user’s privacy and confidentiality, Google’s email and blogging services
are maintained outside China (Schrage, 2006). However, there is no assurance that the Chinese
government will not require this information from the company.
Making the Diagnosis – Although Google put high emphasis on its ethical code of conduct, its
action to allow the Chinese government filter the information that is being provided to the users
contradicts the company’s philosophy of focusing on the user guided decisions and in direct
violation to its mission that is “to organize the world’s information and make it universally
accessible and useful”. This conflict was further affirmed by one of Googles’ attorney; Andrew
McLaughlin (Langberg, 2006) “while removing search results is inconsistent with Google’s
mission, providing no information … is more inconsistent with our mission. The company’s
mission is well thought and has the best intention but failed to recognize possible conflicts that
the company (Google) will encounter as it expands globally.
US Congress including non-governmental organizations, academics, press and the general
public’s ethical concerns are valid but failed to recognize that each country or nation have a set
of rules and regulations that may contradict or deemed unethical in the United States of America.
Doing the action Planning- Before Tom Maclean meets with his supervisor and his peer group;
he first should make a quick phone call to the upper management and obtain their stand on the
issue of Google.cn. At the meeting, the following are his suggested course of actions:
1)
2)
3)
4)
Carefully state the issues in a short and straight bullet points.
Familiarize attendees with historical key facts and current developments.
Reiterate Google’s global strategic plans.
Discuss financial and strategic advantages of Google.cn, its short and long-term impact
including lessons learned.
5) Use threats e.g. censorship, negative publicity, laws and regulations, conflicting ethical
standards, etc. to continually find concessions and solutions without compromising
company standards.
6) Re-affirm to his group that Google.cn is a unique service, created to a particular market
and/or end users.
7) Reiterate that Google.cn is a precedent, and there will be more objections internally (US)
and internationally as the company continues to implement its strategic plans.
8) Acknowledge that all concerned parties have valid concerns but at the same time discuss
the course of actions taken by Google to address these concerns.
9) Solicit observations and welcome suggestions from the group and emphasize the
importance of teamwork.
10) Counter act local bad publicities with positive marketing (emphasize on product/service
differentiation and the ability of the company to offer global service legitimately).
11) Continue to find a different channel to allow access to searches free of censorship and
without comprising users’ personal information and privacy.
12) Re-visit Mission Statement – carefully examine its attainability and make necessary
recommendations to the management if a change will be practical in light of the current
events.
13) Continue tests to identify what information are being suppressed and the extent of
censorship that China has put in place. Once identified, disclose information to the parent
company and advisers to plan possible actions either to include or not on its pop up
message when Google.cn is being utilized.
14) Review captions, titles, key words in the search engine and “re-title” or “re-word” if
necessary. Changes may lead increased availability or more information on the search
engine.