Google in China

Introduction

Google Inc. is among the world’s largest and most successful companies in the internet-related industry and Google.com is the largest search engine in the world today based on the number of users and the amount of content that is available on the search engine. With the initiative for globalization by most corporations today, it can be expected that Google at some point had to expand their operations and venture into the international markets. Considering that information is considered sensitive within some cultures, Google Inc. had to venture into new markets with careful considerations and adjustments that would ensure that they did not violate any social norms with their unrestricted access to information. In China, this task has been particularly difficult owing to the fact that the Chinese government seems stricter than most other governments on the issue of information and the rest of the world looks up to Google to maintain consistent integrity and non-partisanship in the availability of information. Within China, Google Inc. risked losing their license to operate if they did not comply with the government’s conditions for filtering information. The dilemma in this case was rather tough to deal with and it can be stated that the company is still having issues with the Chinese venture and its impact on their corporate image. However, even with some regulatory challenges, Google incorporation’s footprint in the Chinese market is unrivalled and the tech giant stands a chance to succeed in this market just as it is the case in its US upmarket.

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Situational Assessment (SWOT Analysis)

Strengths

Google has can leverage on a number of strengths to bolster its Chinese operations. The first strength lies in Google’s strong brand name. As a company, Google has many operations but the name is currently synonymous with a search engine. This means that many people have grown to associate the brand with finding information online. This means that when one is looking for any form of information they are likely to ‘google’ it, and this places Google ahead of their competition in many ways. Other than being the most famous and most widely used search engine, Google also provides a platform for a variety of other applications that most of their users use in their everyday activities. This means that while it can be used as a stand-alone platform, it is interconnected with other important applications that make it widely relevant and irreplaceable for the user. People who use Google drive, Gmail, Google+, Google docs and other related applications are more likely to use the Google search engine as well out of convenience and familiarity. This makes the search engine even more popular within the international contexts considering that most Android-based smartphones come with the pre-installed applications for Google. Considering how popular smartphones are not only in China but also in the rest of the world, it can be appreciated that a larger percentage of the modern smartphone user is a Google user.

Partnerships with phone companies such as Samsung and Huawei among others have enabled the company to continue to make applications that are well suited for the specifications of the smartphones in which they are installed. The Chinese also have a strong affinity for foreign products. They may have a local search engine that is popular, but when customers are looking for international content, they are more likely to trust in a company with an international image such as Google. This makes Google an ideal search engine for most Chinese internet users who would like to break free from the communist limitations of the Chinese socio-cultural dispensation. Being a global multinational and with the objective of making information widely available and accessible to all the people, it can be noted that Google has a vast expanse of information that would be suitable for any user in any context. This means that Google.com is one of the few places where one cannot expect not to find information on anything. Most other search engines are likely to produce less results on any search compared to the results in Google and these other search engines are even likely to take a longer time to generate the said results.

Weaknesses

The first noticeable weakness that this company has within the Chinese society is the competition. The competing search engines are faster and more compliant with the Chinese information rules and this makes them more efficient for general research. Users are thus only likely to use Google when they cannot find what they are looking for on the local search engines. Another weakness is that the censorship greatly reduces the relevance of the company within China. Censoring accessible information directly undermines the company’s set objective of making information accessible to all the people of the world. In addition, the Chinese government seems to be interested in gaining access to and information regarding private Gmail accounts as part of their initiative for monitoring information within the nation. This is also a great problem given that Google has a privacy policy that guarantees confidentiality to users.

Opportunities

The greatest opportunity that this company has is in relation to the Chinese market. China has one of the largest and strongest markets in the world especially for technology based products. The country alone has the potential of making over $300 million in annual revenues for the internet based products and services despite the tight censorship. This means that as a market, China is very lucrative and potentially profitable. It can be understood that the company would consider pulling out due to the conflict of interest but the market carries serious profitable opportunities if the limited potential is capitalized upon. Google can tackle the issue of censorship without antagonizing the government in question in a number of ways. While these alternative options may seem unconventional at times, they are the best solution for the company at hand. For example, a majority of the Google users in China have used tutorials that they found on Google to use proxies that make them anonymous and thus makes it possible for them to access the uncensored information as well. Using the proxy settings allows these users to view whatever information that they need without having to go through the government filters. Another opportunity is that within the local business industry. Google is an international company but they have a base of operations within China. This base can be used to interact with the local businesses in the region to develop new products and partnerships with them as well. This will expand company revenue and reduce the dependence on the search engines and associated initiatives like Adwords among others.

Threats

The only threat that this company has is the censorship that threatens their ability to live up to the vision and mission as a company. If Google continues to limit the kind of information that Chinese users can access, they will no longer be a relevant international search engine that is ensuring that information is available and accessible in all parts of the world. With the censorship process, the search engine is slower than the local search engines that were built for the censored contexts of the Chinese society. In addition, it can be noted that accepting the terms of the government implies supporting the authoritarian perspectives that suffocate human rights and free speech. For a company with an international scope of stakeholders, Google risks string criticisms from all parts of the world for aiding the Chinese government in their unacceptable hold over the Chinese population.

Problems

In this case, the problem faced by Google is on whether or not to stay on in the Chinese market. There are significant advantages and disadvantages for either choice considering how important China is for the company’s operations in the Asian region. Without the Chinese market, the company will also be losing a significant portion of their annual revenue with the current figures indicating that China generates over $300 million a year. The company however cannot operate effectively in China without following the set rules and regulations on censorship. The challenge is thus to decide on a course of action that will have a smaller negative impact on the company in the long term. In this case, the company has only two difficult alternatives to choose from.

Alternative Courses of Action

First, the company can decide to stick to their operational philosophies that require them to work towards a world where information is freely accessible for everyone. This would imply refusing to negotiate or cooperate with the Chinese government and thus halting operations in the Chinese market. This alternative gives Google an upper hand in the market in numerous ways. First, investing in the Chinese market was very expensive and pulling out now would imply a waste of resources. Secondly, the Chinese government does not need Google as much as Google needs them and this means that the company has no leverage with which to negotiate. If Google leaves China, the Chinese government will continue with its business as usual as Google registers significant losses and most of its clientele will not be able to access information in the manner that google does.

The second alternative is for the company to work within the terms provided by the Chinese government as they support a growing movement in other parts of the world against censorship as practiced by the Chinese government. This will ensure that the company stays in business, citizens can access any information through the proxies and that the government eventually gets pressured into lifting the sanctions on information within the nation. Maintaining operations in China may seem like a money-oriented option but pulling out of China will imply that even those who use anonymity proxies may not be able to access the search engine at all. Staying on will thus ensure that those who know how to circumvent the censorship can do so peacefully and enjoy the information that they seek.

Recommend

The best course of action is to stay in China primarily because pulling out will not stop the Chinese government from censoring information. At this point, Google has to appreciate that their role is to ensure that the censorship stops and they cannot accomplish that without an operation in China. Currently the search engine can continue to work with users who are using the proxies and eventually, more Chinese users will also start using proxies to beat the censorship and gradually access all the information that they require. Walking away from a lucrative market because of the regulations imposed by the government can be considered as giving up on the cause, which in this case is ensuring that information is available and accessible for everyone on the planet.

Conclusion

Google may be in a difficult position with their Chinese operations mainly because the government is in violation of the expected freedoms that involve information and speech. This limitation is on the government and involving Google implies holding the company at ransom to get them to support the unacceptable authoritarian behavior in a heavily democratic world. Staying in China is the only option that Google has if they intend to change the situation for the sake of the Chinese people.

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Jul 27, 2020 in Business
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