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Edition: U.S. Article Comments (3) Save Email Print Reprints Most Popular Most Shared NBC's Leno drama might have a happy ending 13 Jan 2010 Google could find new road in China 13 Jan 2010 Hymns, children's cries fill Haiti's night 12:38am EST Tens of thousands feared dead in Haiti quake | Video 1:16am EST Al Qaeda linked to rogue aviation network 13 Jan 2010 Al Qaeda linked to rogue aviation network 13 Jan 2010 Hymns, children's cries fill Haiti's night 12:38am EST U.S. 2009 foreclosures shatter record despite aid 12:27am EST Tens of thousands feared dead in Haiti quake | Video 13 Jan 2010 Chronic sleep loss hampers performance 13 Jan 2010 Google could find new road in China Alexei Oreskovic SAN FRANCISCO Wed Jan 13, 2010 11:29pm EST Related News U.S., Google and China square off over Internet Wed, Jan 13 2010 Wall Street frets over Google's future in China Wed, Jan 13 2010 Chinese Internet activists applaud Google, see no backdown Wed, Jan 13 2010 Instant View: Google may pull out of China over censorship Wed, Jan 13 2010 Google's statement on China operations Wed, Jan 13 2010 SAN FRANCISCO (Reuters) - Google Inc says it may be forced to leave China, but the search giant has room to compromise in its battle with Beijing, and both sides have reason to do so. Technology | China The company's surprise statement on Tuesday that it was no longer ready to censor search results in China and might pull out of the world's biggest Internet market by users has put it squarely at odds with the Chinese government. But analysts and business experts on Wednesday said Google's past clashes with powerful companies and industries, and the importance of the Chinese market to Google's future, suggest that self-imposed exile from China may not be Google's end-game. Hard lines in previous battles have been negotiating tactics and could be this time, too, they said. "I'm sure they will be pragmatic, Google is a very dynamic company," said Christopher Tang, a professor at the UCLA Anderson School of Management. "I doubt they will walk away like that. The presence in China is very crucial because that's the next wave." China has roughly 360 million users, and its search market topped $1 billion last year. While Google has struggled to compete with local powerhouse Baidu Inc, China represents a major growth opportunity. "As Google grows they're breaking into new markets, and they're challenging the status quo on a lot of things," said Canaccord Adams analyst Jeff Rath. In China, where the government places tight limits on citizens' Web access, Google's search engine represents a threat to the state's control. But many businesses and industries have been threatened in other ways by Google's expansion, and the company has compromised in some of those clashes. PAST BATTLES POINT TO CHINA PLANS? Google's business of offering free products and services has helped it steamroll into many new markets in recent years, from books to wireless phones. While Google has insisted it had the right to scan thousands of library books and put them online, the company chose to settle a class action suit in 2008 bought by authors and publishers' groups. It agreed to a $125 million settlement that would create a books rights registry, where authors and publishers register works and are paid for books that Google puts online. Google attempted to crack open the wireless phone market, which has traditionally been controlled by communications companies. But after an initial clash, it has opted to partner some incumbent wireless firms rather than continue its unilateral assault. Some say that pragmatic approach could work in China as well, even though Google has taken a stand on free Internet speech. POSSIBLE COMPROMISES UCLA's Tang said Google could reach an agreement with Beijing in which it dropped its search efforts but offered other products such as the Google Voice Internet calling service or Google's archive of digital books. The Chinese government censors much of the Web that is viewable to Chinese surfers and potentially could allow Google to operate an unfiltered Chinese language version of the Web site from that content, said Stanford University Graduate School of Business Professor Haim Mendelson. The government then would censor, but Google would not. While Mendelson said he thought it was more likely Google would leave China, he said a compromise could give both sides something they want. China wants to maintain its image at home and abroad, and being rebuffed by Google doesn't help. "Google has some interest in maintaining a presence in China, and the Chinese government has an interest as well," said Mendelson. "The Chinese government wants to project an image of the country where they do want U.S. companies to be present." (Reporting by Alexei Oreskovic; Editing by Peter Henderson) Technology China Comments See All Comments (3) | Post Comment Jan 14, 2010 I wouldn’t want to encourage any company to make compromises in dealing with totalitarian dictatorships. Countries that violate human rights are countries that are preparing for war; Nazi Germany taught us this lesson, and it is unclear why we are forgetting it. quadibloc Report As Abusive Jan 14, 2010 Don’t think Google will drop their core product – Search in China, sounds very un-google! diptom Report As Abusive Jan 14, 2010 What do you know about totalitarian dictatorships? what do you know about China? And what exactly do you know about Nazi?? Stop running around talking about wars when you do not know anything about China. Sounds a little bit extreme to someone who have been living in China for years. kidbao1290me Report As Abusive See All Comments (3) Add a Comment More from Reuters China backs censorship after Google threat BEIJING (Reuters) - China told companies to back state control of the Internet on Thursday, showing no sign of giving ground on censorship after U.S. Internet giant Google threatened to quit the country. | Video Lawmaker wants Geithner's AIG records, testimony Japan says U.S. ties firm, not leaning towards China Asian shares rebound, rate view lifts Aussie JAL failure would hit about 1,500 small firms: report Treasury needs plan for selling TARP assets: watchdog » More Top News Haiti quake leaves many dead A major earthquake toppled the presidential palace and hillside shanties alike, leaving the poor Caribbean nation appealing for international help. Full Article | Slideshow Live coverage of the Haiti earthquake Factbox: Quake-stricken Haiti Send us your photos and videos NATURAL DISASTERS Exclusive: Al Qaeda linked to air network Homeland Security ignored a report detailing a clandestine fleet of executive jets regularly crisscrossing the Altantic on drug runs. The problem is now a global security threat. Full Article Graphic: Trafficking to Europe Three in al Qaeda case plead not guilty Mexico © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Analyst Research Mobile Newsletters RSS Podcasts Widgets Your View Labs Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts.com Buyouts Europe: Buyouts Conferences: Venture Capital Journal ECVJ International Financing Review International Securitisation Report Project Finance International PEhub.com PE Week Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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