University of Chicago
Type of paper: Thesis/Dissertation Chapter
Google in China Case Study
In the case study presentation regarding the Google Company there have been many challenges that have arisen during the growth of the global leader. One of those challenges is in regards to the penetration of the largely available market in China. Google has a mission “to organize the world’s information and make it universally accessible and useful.” (Closing Case: Google in China) Google has constructed a largely profitable advertising business that piggy backs its search engine; which by far is the largest in the world. Using a business model called pay-per-click; advertisers pay Google each time a user of the search engine clicks on one of the paid links that are usually listed on the right hand side of engines results page. These are the paid links and are not included in the main search results generated by Google.
In order to penetrate a larger market and further increase popularity Google began running a Chinese language service in 2000 for the largest country on the planet; even though the service was operated from the United States. In 2002, Chinese authorities blocked the site. The people that would have been using Google’s search engine were directed to a Chinese rival search engine company. This came as a huge surprise to Google’s managers. When this occurred the co-founder of Google quickly ordered several books on China and began studying in order to understand its vast country and its culture. In just two weeks’ time the services were restored in China. It appeared that this had just come out of nowhere. It was reported by Chinese users that politically sensitive material sites were no longer accessible.
This gave way to the suggestion that the Chinese government had begun monitoring search activities more aggressively. This also generated the suggestion that the Chinese government had constructed a giant firewall between Chinese internet and the internet in the rest of the world allowing the Chinese government to block any sites that were deemed insurrectionary. Due to the fact that serving the Chinese from the United States was incredibly slow and the new censorship imposition was ruing search results Google decided it was time for some change. In a new mindset of operations Google decided to open up a site in China using Chinese management and employees and even a Chinese home page.
The Culture and Conclusion
It appeared that the cultural divide between Google and China caused some misunderstandings to take place; this in-turn caused some serious offenses to be made. Chinese government did what it felt needed to be done in order to keep the divide between government and citizenship as strong as it has always been. Realizing that it had crossed the line, the search giant Google decided to move its Chinese operations overseas. Google was faced with two choices, they could give up China or and lose over 100 million users, a number that rapidly increases every year, or operate out of China and respect the culture. Now that Google is up and operating in China, even though they have to provide a slightly more less lucrative service, they have provided a small notation for every site that has been blocked once the search results show up; a service no other provider gives.
Closing Case: Google in China; by International Business. Competing in the Global Marketplace, Seventh Edition Chapter 4: Ethics in International Business: by Charles W. L. Hill copyright © 2009 McGraw-Hill, a business unit of the McGraw-Hill Companies, Inc. https://ecampus.phoenix.edu/content/eBookLibrary2/content/eReader.aspx