Business News

Slew of Chinese Companies Debate Links with Google

Kathrin Hille in Beijing|Financial Times

A wave of Chinese businesses are reconsidering their ties with Google in the wake of the US internet company’s move to confront their government over internet censorship.

Google China
STR | AFP | Getty Images

The decision for companies like Sina , the web portal, or China Mobile , the telecoms operator, on whether to stay with Google as a search partner comes in a climate of rising political pressure as their government shows its displeasure with Google’s challenge.

Some partners said they were reviewing their relations with Google. “We are currently discussing this internally,” said Luo Weimin, chief operating officer of Xunlei, a video downloading site whose video search is supported by Google.

Sina, a leading news portal in China, also said it was considering the impact of Google’s move on its ties with the company. The web search function on Sina’s page is powered by Google.

Kingsoft, a software company which runs an online dictionary with Google, said it had not thought about what to do after their contract expires in October. “Yesterday, Google’s people told me in private that if we came under pressure, they would understand,” said Gao Zhang, a company spokesman.

In another setback to Google, a Motorola handset sold by China Telecom , the country’s third-largest mobile operator, will no longer include Google’s search engine. That follows an announcement by China Unicom , China Telecom’s larger rival, that phones using Google’s Android operating system would not feature the US company’s search function.

Google has thousands of partnerships in China ranging from loose advertising agent relationships to co-operations where it offers joint services with other internet groups.

Analysts said that while small customers and advertising agencies were likely to decide whether to stay with Google on purely commercial grounds, larger partners would have political considerations because they had a higher public profile and relied more heavily on regulatory approvals such as internet content providers’ licences.

“For ad customers and ad agents, the only thing that matters will be whether traffic can remain stable at the Hong Kong site,” said Edward Yu, chief executive of Analysys, an internet research firm. “But for internet companies which have closer partnerships and some integrated services with Google, the impact will be bigger. They will also consider what the government thinks and wants them to do,” he added.

Google’s page on Renren, a Chinese equivalent of Facebook, was closed on Wednesday, robbing the company of a key marketing space. Users visiting the page of Xiao Gu Gege, or “Little Brother Google” on Renren, were told: “This account has been blocked by the administrator due to inappropriate behaviour.”

Website hosts in China are being held responsible by the authorities for content on their domains, and are required to self-censor. They often receive explicit detailed censorship orders. The government has also ordered a media blackout on Google’s stand-off with Beijing.

An editor at a news portal said internet censorship officials had banned the use of reports on Google other than those filed by central government-level media such as Xinhua, the official news agency.

- Additional reporting by Kerry Ma