Google Hacked, May Pull Out of China 687
D H NG writes "Following a sophisticated attack on Google infrastructure originating from China late last year, Google has decided to take 'a new approach' to China. In their investigation, Google found that more than 20 large companies had been infiltrated and dozens of Chinese human rights activists' Gmail accounts had been compromised. Google has decided to 'review the feasibility of [its] business operations in China,' no longer censoring results in Google.cn, and if necessary, to 'shut down Google.cn, and potentially [Google's] offices in China.'"
Excellent idea (Score:4, Interesting)
Why wait?
What's the impact? (Score:4, Interesting)
I honestly want to know.
What would the impact of Google pulling out of China mean to citizens? How popular was Google, compared to Baidu, Bing, Yahoo, etc. in the Chinese web search space?
So what will happen in practice? (Score:5, Interesting)
My guess: Google stops censoring itself, gaining credibility for its belatedly 'principled' stand against the Chinese government, while sending a message to China that hacking its servers is Not Polite. China predictably steps in to filter the search results using its own mechanisms, relieving Google of the burden. Google gets to keep its advertising revenue, while the users behind the Great Firewall get (at best) the same censorship as before. Now if Google really wants to make a point, with a genuine and serious risk of losing business, how about making google.cn an exclusively SSL site and seeing how fast China blocks it..?
Re:Free trade of ideas, anyone? (Score:5, Interesting)
maybe there just isn't any money to be made there without problems that threaten Google's reputation that it cashes in with elsewhere.
Good question. I doubt that the cost in loss of goodwill exceeds potential revenue in China. Which in turn means that there might be something else at play. Does Google want to play hardball with China? Is it concerned that the external costs of doing business in China (exposed servers, lots of red tape, etc) outweighs the revenue it gets from being available in China?
Either which way, I'm going to follow this. I doubt that much will change - but the various exchanges and discussions that come up around this should make for a good read.
Wow!! Very surprising! (Score:5, Interesting)
I don't know how much of my comment history is available at present, but it doesn't seem that long ago that I was commenting that Google is not to be trusted because they are a corporation and they are all about advertising revenue. The fact that they have capitulated to China in the past was reaffirming to my perspective.
But if this story plays out and Google pulls out of China based on the Chinese government's persecution of descenters, opposition and critics, then I have to say that Goggle will actually start changing my mind about them after all. And I have to say, just like many others, changing my mind about something is not particularly easy to do -- but if they do this, I will be PLEASANTLY surprised.
In addition to that, any U.S. company that fails to take a similar approach to dealing with China is simply without balls by comparison.
Re:So what will happen in practice? (Score:2, Interesting)
It wouldn't work. In response to the ability to use google via SSLthe chinese government added URL string scanning to it's list of tools years ago. They could still check people for using banned keywords (and greatly increase the banned list if it is google) and block the specific requests. Google would need to change it's entire infrastructure to no longer pass the keywords in the URL string (even encoding them wouldn't work as they could simply test by entering the strings and then scanning on the resulting URL) It could be done but not quickly, not easily, and it would be expensive as hell
Re:the issue has been discussed here before: (Score:3, Interesting)
score one for human rights
and score one for google's integrity
today is a good day
No kidding. I'll be very interested to see what Yahoo does, especially given their own cooperation [slashdot.org] with China's secret police.
Re:Google Full of Crap (Score:4, Interesting)
Call it PR, or negotiation, or leverage. Fundamentally, it is the same thing at the scale Google is talking about.
Google wants something, and thinks that now is the time to discuss it. I would guess there is more going on than just this hackery. It may well be that what they want is to close down, but I can't imagine, even if they do, that that's the whole of it - they don't seem the sort of company to simply give up on such a huge market in their core markets simply because Baidu out-"competed" them (for values of competition that do include government-level lobbying).
Re:So what will happen in practice? (Score:4, Interesting)
That's exactly what I was thinking. Most HTTP servers and related software treat GET and POST variables in exactly the same way unless explicitly told not to. I haven't tried a POST request from Google yet, but I'd be very surprised if they don't support it.
Besides, GET should still remain private, as the first thing that happens in an HTTPS connection is the SSL handshake. (BEFORE the URL string is sent) All the government would know is that someone was connecting to google.cn via HTTPS.
Re:Free trade of ideas, anyone? (Score:5, Interesting)
Since the average annual wage for much of China is still about $500 per year, I think the financial calculus for dealing with them might be a little more complicated that you suggest.
Remember, even though annual disposable income in the big cities is as high as $2000 per year on average, there are one whole hell of a lot of people in China who are still dirt poor and aren't going to be buying a lot of products seen advertised on Google.
It's going to be interesting to see how this shakes out. I suspect that the core values of the founders of Google haven't changed that much over the years, but their great success may have led them to believe that they are as likely to change a repressive society like China or Iran as those societies are to change Google.
It still remains to be seen if their egos are right or not. Chinese society with all its complicated stratification and variety has been around a good deal longer than Google, but I've seen big and varied societies make enormous changes in a very short time during my own lifetime.
Re:Free trade of ideas, anyone? (Score:3, Interesting)
Re:Google Full of Crap (Score:5, Interesting)
I don't think it's fair to say they were beaten by Baidu.
Is it? (Score:5, Interesting)
Google had a great reputation with its "Do no evil" motto. And then they went into China and they lost it.
What is worth more to google. A great reputation in the west and no business in China, or a sullied reputation in the west and lousy business in China that may be cut off any day when the government chances its mind? You seem to assume like many others that doing business in China is easy, just follow the rules and you make a profit. But that is not the case. You IP is an open target, the government can change the rules whenever it wants and the local competition is heavily entwined with the state.
That makes for a difficult operating environment. It is indeed a brave move by Google to go against the Wall Street mentality of "a penny today" but long term it might be the wisest move they ever make. At least they are sending a signal that there are limits. It seems that at the end of the crisis, something might be changing. Even the US seems to be considering to tax banks... unthinkable in the past. New firms are starting up that claim they will things different and now google being the first to question the Wall Street wisdom that doing business in China is worth everything.
And as for enormous. China only passed Germany this year in exports. The market really ain't all that large. Large parts of it are dirt poor and the rest works for pennies. India is equal in population size and a lot more open. You don't see everyone bending over backwards for India do you? Wall Street loves China, no meddling human rights to upset things, simple rules. But Wall Street has shown it doesn't know shit.
I am frankly surprised at reading this story. Either we soon will get an update that this guy was fired or Google is very serious about this. Because somewhere in China, someone just fainted. The Chinese government does NOT want google to just disappear because of its actions, the average Chinese person doesn't really believe that censorship affects him/her personally. It is just for troublemakers. When google goes (and with that youtube etc etc) it will be noticed far more clearly then some dissident being locked up.
Who knew, Google might actually life up to its motto "Do no evil". Wonder what other companies will do... If Google follows-up on this, MS apologists lost a major piece of ammunition.
Google can simply move (Score:4, Interesting)
All of it's Chinese offices to Taiwan. That will really piss off China. And Taiwan is *much* friendlier than China.
Re:Free trade of ideas, anyone? (Score:5, Interesting)
Forget reputations. The big question here is if there's money to be made in China at all.
Over the last 10 years, there has been a roaring trade between the west and China. Ordinarily, this would be a great thing, but so far trade has been completely one sided. The fact is, the west has very little that the Chinese actually want to buy, or cannot manufacture themselves. Individual companies have been making short term gains by relocating their businesses to China; but in the long term, Chinese competitors (generally state subsidised) quickly emerge and dominate the local market and then the export market. For short term gain, western companies essentially write their own death warrants.
Google has gone into China. It has gotten nowhere. It's not the only company to see this happen. This big market, a fifth or the worlds population, turns out not to actually be worth the effort in most cases. Not only do you have to put up with the nineteenth century nonsense perpetuated by the communist party, you have to accept the fact that local competitors can and will eat you alive, either with state assistance, ruthless exploitation of labour, or by flat out ignoring the IP rules you hold so dear. Tell me the Western company that is making money in China itself. Making the kind of money that's going to help pay the balance of trade deficit that has emerged from the amount of money Chinese exporters have made in the last 10 years. Name me one.
China isn't worth it. At least not now. Come back in 30 years when the country has some human rights, democratic government and respect for trade laws. Then you can do, what is commonly called, business. There'll probably be a lot more money in people's pockets by that time too. Right now the whole country is a shell game you can never win, no matter how much you think the rules have to be the same. There's no point talking about gaining first mover advantage in a country where people can't even change jobs without a bloody chit. Not for the vast majority of companies.
Maybe Google will finally come to realise this. People may think its signals their return to the light side of the force. Personally, I'm inclined to think Google simply has a most ironic stance towards the personal data to compiles on the world population, jealously guarding it from all comers. Either way, Google leaving China will end up being a net positive for the company, its users, and the balance of trade deficit. The Chinese might lose a few search results, but frankly, that's the bed they've made for themselves right now.
Re:Free trade of ideas, anyone? (Score:5, Interesting)
"It cost us more than it's getting us."
it probably isn't that simple. Google has to measure future value, or they may get stuck like some US based equipment manufactures did recently. IE years ago the China rules for big equipment orders (must build manufacturing in china...) was not profitable. Asian manufactures went in anyway. When china held up better, and did more stimulus money in manufacturing during this recession, the Asian manufactures were at a huge advantage with dealer networks, government contacts, China strategies... The US companies had to buy China partners to get in. Smart companies need to keep a finger on the pulse of these possibly emerging markets, if China opens up the disposable income gap could swap in a short time.
Re:Free trade of ideas, anyone? (Score:5, Interesting)
Either way, Google leaving China will end up being a net positive for the company, its users, and the balance of trade deficit.
There's more to it than that. It would set a precedent. It would be something that make CEOs and boards of other companies wonder if they should at least review their strategy in China, and hopefully follow suit.
It would also get a lot of news coverage. Google is very well-known, enough so that a story like that would likely be run by all major Western TV channels, newspapers etc. This would be some awesome propaganda.
Diplomacy 101 (Score:5, Interesting)
Reading some of the news coming out about hackers in China, I get the impression that there might be unofficial sanctioning or sponsorship by the government of some Chinese hacker groups.
It also strikes me as a little off that a company announces it 'might' pull out of a country. Usually, these decisions are made internally and press conferences are called to either announce or deny that something is going to happen. If you are a company like Google, you don't openly call the government for hacking and spying. I wonder if this is Google telling the government that it won't put up with their shit?
Now there's a thoughtful response (Score:2, Interesting)
Who is this "them" that you hate? The country as a whole? The internet users? China's government? There are more than a billion people in China, do you hate all of them individually? Does your hate include children, open source programmers, priests, movie makers, democracy activists, camel drivers, nurses, day care workers, bicycle repairmen, and secretaries for local government?
Do you hate the Chinese language? I hear it's hard to learn. How about Chinese culture? China has a rich tradition in the visual arts and one of the world's great literatures extending back more than 2000 years. Do you hate Chinese sports? Did Ding Junhui beat one of your favorite snooker players this season?
Perhaps you hate the Chinese government including the party old guard and reformers. You must really despise those who wish they were serving their fellow citizens with a transparent, accountable, representative government.
The NY Times cites James Malvenon as saying this is a new development in the practice of cyber warfare. Your jingoistic response suits the context of war perfectly. This was a bad move by someone in China and could hurt everyone involved. To paraphrase Ken Waltz, there's no victory in war, just degrees of defeat.
China will gradually become a fully participating member of the international community. Who that will benefit remains to be seen, but one way or another it's going to happen. It is bad news that as the Chinese government stretches its muscles and experiments with its growing power that it engages in this kind of aggression against private foreign companies. However, something to notice: this story is about China's domestic politics and controlling internal dissent, not about any international conflict. This is why everyone outside China has a stake in the rights and freedoms enjoyed by Chinese citizens and the Chinese state's strict limits on those freedoms. The importance of a country's internal affairs to the world as a whole might remind you of global attitudes toward another economic powerhouse on the other side of the Pacific Ocean.
Adobe one of the other cyber attack targets? (Score:2, Interesting)
Looks like Adobe could have been one of the other said targets in the cyber attack. Adobe was just issued this press release today:
Adobe Investigates Corporate Network Security Issue
http://blogs.adobe.com/conversations/2010/01/adobe_investigates_corporate_n.html [adobe.com]
Posted by Pooja Prasad on January 12, 2010 3:16 PM
Adobe became aware on January 2, 2010 of a computer security incident involving a sophisticated, coordinated attack against corporate network systems managed by Adobe and other companies. We are currently in contact with other companies and are investigating the incident. At this time, we have no evidence to indicate that any sensitive information--including customer, financial, employee or any other sensitive data--has been compromised. We anticipate the full investigation will take quite some time to complete. We have and will continue to use information gained from this attack to make infrastructure improvements to enhance security for Adobe, our customers and our partners.
Guess what Baidu has already censored? (Score:5, Interesting)
Step #1: Visit www.baidu.com.
Step #2: Search for Google or blogspot.com. Note that both work.
Step #3: Now search for google.blogspot.com.
Step #4: Enjoy your Baidu lockout. You should be able to search again in 5-10 minutes, I haven't timed the duration exactly.
A tangibles option (Score:4, Interesting)
Google has a tangibles option. They could start not emphasizing ads as much as actually selling stuff themselves, ie a super amazon effort. They are starting now with their cellphone, this branching out..and there is nothing stopping them from going on to all sorts of other tangible products, which would make their advertising just a force multiplier instead of an economic end game, even if all they started out with was a profit sharing deal with ad buyers..
Re:Free trade of ideas, anyone? (Score:4, Interesting)
And this is devastating for the Chinese government. After keeping their populace docile and stupid,
Clearly, you've never met an actual Chinese person. Do you honestly think they don't know what's going on? No, they know. They just don't care. They're lives have been massively transformed for the better. Especially for those on the coast. (The western interior is another story.) They don't want to rock the boat. Everything is going swimingly for them. Why change?
what they want more than anything else is to be taken seriously as an economic player, sit at the big boy's table and rake in some of that fat global trade cash.
As the world's largest exporter, and fastest growing economy, aren't they already?
So, when one of the biggest companies around says China's market is more hassle than it's worth, it shows them up for the bumpkins that they still are.
Yeah, but Google isn't the biggest in China. It's Baidu. Blogging? That's MSN Spaces. I've yet to meet a Chinese student that does not have an MSN Spaces account. Twitter? I'm sorry. Did you mean Plurk?
Seriously, it's a whole other world outside the US, and you don't seem to know its players.
But we knew this was coming (and hopefully Nixon did too). Can't have all the benefits of capitalism without losing some of the "benefits" of totalitarianism. You can have some of one and lots of the other (like most Western democracies), but not lots of both.
Well that's the line Wall Street sold us back in 1989 while the Tianamen Square was still damp wasn't it? It's been 20 years. While some may argue the jury may still be out on that one (I wouldn't.); it's been long enough to get some indication of how its leaning, Let's examine the facts shall we?
China's GDP growth was at 11% last quarter [dailyfinance.com], for year-over-year growth of about 8%, and just now replaced Germany as the world's leading exporter. (Funny, how does a "Socialist" European Free Market(tm) democracy be former world's largest exporter, but the US can't be? The mind reels. Oh wait. No it doesn't.) Now China is luring back [slashdot.org] it's top talent, by offering them better opportunities. Allow me to quote from that article:
Such is the sweet taste of liberty, eh?
No, I believe that China has found it's third way [slate.com]. Not only "To be rich is glorious" [brainyquote.com], but "Sometimes when we [Chinese] have the faith we have to take different approaches to realize our beliefs. The ultimate goal is the common prosperity, but we have to let a group of people to get rich first." [slate.com] Or as Slate put it, "How do you say 'trickle down' in Mandarin?"
Blogspot is blocked in China... (Score:2, Interesting)
I work in ShangHai, I can say that many Chinese uses google.cn and most of them can't imagine google pulling out of China...
It's ironic to see that Google chose to post this on blogspot which is blocked in China!
Re:So what will happen in practice? (Score:3, Interesting)
Most HTTP servers and related software treat GET and POST variables in exactly the same way unless explicitly told not to.
Name three.
The only thing I can think of that still does this is PHP, and only if you use the $_REQUEST variable.
Treating GET and POST the same is broken. For one thing, GET is required to be idempotent, POST is not.
Re:Free trade of ideas, anyone? (Score:5, Interesting)
An acquaintance works for a Canadian company that sells machines to apply a specialized chemical coating to certain types of containers (the vagueness is intentional). A trip of executives and engineers resulted in a sale of four units (enough for a small company) and a couple of hundred thousand liters of coating to a mid-size Chinese company.
On the next trip their were no more sales. In fact, the machines were reverse engineered (as was the coating substance) and are actively being sold at a fraction of the price, despite that all of the Canadian stuff had appropriate IP protection.
Between this sort of stuff and the shenanigans that the Chinese are involved in with respect to cooking the books of their stock markets, I'm not so sure I'd call them an "emerging market". More like an "emerging bubble" waiting to take down their investors in the next few years.
Re:Free trade of ideas, anyone? (Score:5, Interesting)
"the government didn't want to pay as much as Rio Tinto wanted to charge"
Which is the crux of the issue with China that I pray people in the west start waking up to.
When you do business in China, you're doing business with the corrupt and totalitarian Chinese Government - a nasty operation that has no intent of *ever* being any less corrupt and ruthless than it is now. The separation between any so called "private" business and the government (especially big business) in China is whatever the party leaders say it is at any given moment. Rio thought they were negotiating a tough iron ore deal with the Chinese foundries as they would do with any private business in any western democracy, that is they played hardball with them.
The problem is, the Chinese government decided it didn't like said foundries being negotiated with in such a harsh manner (who does this pip squeak company think it is embarrassing us internationally!) and so threw the top man Rio man in China in gaol where it then took three months to even bother *charging* him.
And of course we know the upstanding state of justice in the Chinese legal system...
Dear corporate west, if you deal with the totalitarian devil you will eventually get burned.
A lesson that should have been learned once and for all in the 1930s.
brave new world (Score:3, Interesting)
Re:Free trade of ideas, anyone? (Score:5, Interesting)
Personally I think China in it's present form is toast, first the Himalayan glaciers [slashdot.org] are receding precipitously due to Black soot particulates [livescience.com],which will devastate the Asian watershed, we're heading into 30 years of mini-ice age, Beijing was hit by its heaviest snowfall in 60 years [wattsupwiththat.com] so Asian agriculture may be in for quite a hard time. Cold [nasa.gov], thirsty and hungry people get mean, and some kind of massive change is coming as far as China, the magic eight ball says "it's a good time to get the hell out of Dodge".
Stereotype (Score:4, Interesting)
Clearly, you've never met an actual Chinese person. Do you honestly think they don't know what's going on? No, they know. They just don't care.
That's not entirely true. Often true, but not entirely.
In college I worked in a research group that was probably 80% Chinese. This was in the late 90s, when Internet as means of exchanging information was somewhat new. We worked shifts together monitoring experiments, which got boring, so naturally all of us swapped stories.
One of our research group was a Chinese visiting scholar, probably in his 40s. An American student asked him what he thought about Tienanmen. At first we thought he didn't understand what we were asking, but then it became clear - he'd never heard of this event. The government had successfully kept it from him.
This being the internet age, we quickly brought up the pictures of the event we're all familiar with now. It was one of the most memorable, but sad, experiences of my life to watch this guy go from denial to disbelief, learning that his government had committed atrocities against its people and covered it up. I can't really express how strongly that interaction affected me.
So unless things in China have changed drastically in the last 10 years - which is possible - China is still somewhat effective at keeping its people in the dark. And from what I experienced with our visiting scholar, there are Chinese people who care very much.
I'm pretty sure it was an inside job ... (Score:4, Interesting)
It was surely an inside job. Google needs employees in China to manage the operations there. Even if you keep them under control, or if you send trusted employees from overseas, it's a huge hazard. The government in China has a really tight control of the population, and everyone is afraid of the government. I'm pretty sure it was easy for an insider to leak information, and I'm also pretty sure that the government isn't just buying the "yes, we will comply with your filter" response from Google, and is not only constantly monitoring search results, but also getting inside information about how things are being handled.
If you don't make a huge profit out of China, the rest of the world complains about the censorship you agreed to apply at search results, and you are risking trade secrets and being harassed, then the Chinese market isn't so interesting anymore.
If I were in Google's situation, I would gladly let those 300 millions a year go, and just leave China.
This is clearly the work of the Chinese government (Score:3, Interesting)
Google gets hit by a hacker attack, and for that reason decides they're not going to do business inside an entire country anymore? This sounds extremely fishy. One of the richest tech companies in the world should have the money and know-how to establish peerlessly good electronic security...
...unless the people going after them are the Chinese government itself, in which case it would be reasonable for Google to believe that they will never have a safe haven for conducting operations in China without risking compromises to their security.
Who else but the government of China has the means (plenty of money), the motive (stopping Chinese human rights activists), and the opportunity (Google's conducting of operations within China) to scare Google this badly?
China a Threat? (Score:3, Interesting)
Re:Free trade of ideas, anyone? (Score:5, Interesting)
The decision to sideline Beijing is remarkable as China is the largest iron ore importer, accounting for more than 50 per cent of the seaborne market.
The miners have so far held no substantive negotiations with the Chinese side, led by Baosteel, the big state-owned steel mill, according to people familiar with the talks.
They added that there were no plans to travel to China for talks, meeting instead in Singapore.
One executive said: "As far as I am concerned, they [the Chinese negotiators] could come over to Australia if they want to talk."
There are some allegations making the rounds that Obama was played by the Chinese in Copenhagen [guardian.co.uk]. The mining case plus Google's actions makes me wonder if the West has decided that China has gotten too big for its britches and is being reminded that they are not a superpower yet and that they need to learn to be a little more cooperative with the rest of the world.
India, O.K. Eastern Europe? Stay out of Russia. Guy I know had his business taken over by the Russian Mob. There is no Rule of Law in either Russia or China.
Re:Free trade of ideas, anyone? (Score:1, Interesting)
Regardless of the parent being mod funny, there is more truth to that. If Singapore would have the physical size of China, including its problems, it would look like a very different country, in fact more like China.
Size matters.
Re:Free trade of ideas, anyone? (Score:3, Interesting)
Dear corporate west, if you deal with the totalitarian devil you will eventually get burned.
A lesson that should have been learned once and for all in the 1930s
And this is why Prescott Bush did not live in Nazi Germany when striking deals with them.
You can still make a lot of money dealing with the totalitarian devil. You just don't get to be stupid, when doing it.
Re:Free trade of ideas, anyone? (Score:4, Interesting)
Re:Free trade of ideas, anyone? (Score:2, Interesting)
You mean the people of Singapore have a different opinion ?
Because you can't seriously be saying that Singapore has a different balance: I know that Singpore is a capitalist country with lots of totalitarianism. They may be in self-denial about it, but that's how totalitarianism works.
Singaporeans think they are free to talk about anything they like, as long as it is in private. They don't expect complete freedom, all the time, for the sake of harmony. And they are told what to think; it comes via PSAs and other media outlets.
Google Needs Goodwill (Score:3, Interesting)
People are loosing faith in googles 'Do No Evil' claim, especially since they are becoming so big. Go to Google news and type in "Google Monopoly" to see the effect:
Newspapers:
German Justice Minister Criticizes Google 'I See a Giant Monopoly Developing That's Reminiscent of Microsoft'
http://www.spiegel.de/international/germany/0,1518,671426,00.html [spiegel.de]
Bloggers:
"I have come to the conclusion that Google has evolved into what economists call a "natural monopoly"."
http://tpmcafe.talkingpointsmemo.com/2009/12/28/google_monopoly/ [talkingpointsmemo.com]
Even the FTC:
http://it-chuiko.com/internet/1887-googles-anti-monopoly-office-is-under-scrutiny.html [it-chuiko.com]
Google knows it is under scrutiny. Just look at google trends. http://www.google.com/trends?q=google+monopoly [google.com]
Now you have the Nexus issue, and Google's name is being drug through the mud. Their name needs some work, and taking care of their biggest black eye will help if it is published widely enough.