GOOGLE’s PROBLEM IN

CHINA

Submitted by:
Shashank Chauhan
 HISTORY
• Founded by : Larry Page and Sergey Brin students of Stanford University,
California, USA.
• Come up with an algorithm called “PageRank”
• Realized that the search result provided by BackRub were superior than
others.
• Named the search engine Google and released the first version on Stanford
University website in August 1996.
• Co-founder of Yahoo! David Filo encouraged them to start a search engine
company.
• A faculty of Stanford introduced them with Andy Bechtolsheim co-founder
of Sun Microsystems.
• He was impressed and handed over a check for US$100,000 in favor of Google Inc.
• Google opened its first office in Menlo Park, California in September 1998.
• There after in 1998 they come up in the top 100 search engines.
• By 2000 Google also introduced a self service advertisement program called
Adwords.
• In 2002 company comes up with an agreement with AOL to which Google will
provide search results and AOL placed banner advertisements from Google on its
website.
• By February 2004, Google expanded its web index to around six billion items. On 29
April 2004 filed an application with US Securities exchange Commission (SEC) for
initial public offering & raise US$1.2 billion in August 2004.
 INTERNET in CHINA
(REGULATING BODIES)
• Internet in China is guided be complex laws and regulations.
• Ministry of Information Industry (MII) operates networks to connect to the
global internet.
• The legal regulation comprises prohibitions issued by multiple bodies:
 Central Propaganda Department, Department of Commerce
 Department of Telecommunication
 General Administration of Press and Publication (GAP)
 Ministry of Culture, Ministry of Information Industry
 Ministry of Public Security
 Public Security Bureau
 State Administration of Radio, Film and Television
 State Council Information Agency
 State Secrets Bureau
 FORBIDDEN SEARCHS IN CHINA

• Chinese government does not allow the free access to various contents
like:
 Tiananmen Square
 Tibet Independence/ Dalai Lama
 Falun Gong
 Political Status of Taiwan
 Human Rights
 GOOGLE in CHINA
• Began its operation in September 2000 by offering 24 million web pages in
Chinese language.
• By 2002 gained lot of popularity.
• By 2003 Google ranked #1 with share of 34.8%
• In September 2002 government was installing a new filtering software
containing specified words. They installed this software in four public
access networks that blocked GOOGLE.
• REASON: Users of Google was accessing the restricted pages by
government through cached pages.
• There by the search speed drastically goes down and sometimes not even
accessible.
• In September 2004 Google launched Google News, by November 2004
Chinese authorities blocked the news in English.

• Thereafter Google was unreachable 10% of the times.

• Elliot Scharge, Vice-president, Google communucation and Public Affairs

said “Google was seven times slower than its competitor Baidu”.
 MARKET SHARE
• Google was continuously loosing market share.
• In 2003 Baidu’s share was 2.5% of the internet search market.
• By 2005 Google’s share was below 30% while Baidu’s share in the market
was 46%.
MARKET SHARE (%) BEIJING IN JUNE 2005
MARKET SHARE (%) SHANGHAI
IN JUNE 2005
 MARKET SHARE (%)
GUANGZHOU IN JUNE 2005
 GOOGLE COME BACK
• Because of lucrative market and size Google wanted its major presence in
China.

• Google felt only its local presence in China could provide a better and
more reliable service and for that they need an Internet Content Provider
license.

• In April 2005 they got the license and Google announces its opening of
representative office, R&D and registered URL- www.google.com.cn
 FILTERING & GOOGLE
• Filtering search result was against Google’s policy but in order to capitalize market
they have done that.
• ANALYST POINTS OUT:
• They pointed out that not only in China Google had done in other countries also:
 GERMANY : Google followed the orders of government in restricting references to
site that denied the Holocaust.
 FRANCE : sites that encouraged racial hatred were prohibited.
 UNITED STATES : US practiced censorship to Digital Millennium Copyright Act
and Google assisted the authorities in checking copyright infringements.

“What’s important to users is access of information, we’re giving them that, and we think that’s the
most information. We’d like to give to give all the information, but we just can’t.”
-Peter Norvig
(Director of Research, Google)
 LAUNCH OF GOOGLE.CN
• In January 2006 google.cn was officially launched.

• Google maintained its stand on protecting user policy.

• Thus modifying its search capabilities according to Chinese government

gives Google to access one of the most lucrative market in the world.

• After the downfall of market share it will be tough to regain market share
WEBSITES NOT LISTED IN
GOOGLE.CN
Website Type
Bacardi.com Alcohol
Bignews.org News
Chinesenewsweek.com News

Collegehumor.com Humor
Date.com Dating
Falunasia.com Advocacy
Funnyjokes.com Humor
Hightimes.com Drug Use
Hrw.org Advocacy
Libertytimes.com.tw News
Mm52.com Entertainment
Netfirms.com Webhosting
WEBSITES NOT LISTED IN
GOOGLE.CN
Website Type

News.bbc.co.uk News

Omnitalk.com Community

Sonicnet.com Music

Time.com News

Voa.gov Government