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Principles Versus Profits

As you may know, I made several visits to Google’s headquarters in Mountain View, California, in recent months for the CNBC original production I hosted calledInside the Mind of Google.” I’ve covered a lot of companies in my 20 years in the financial news business, and Google is one of the most fascinating.

It’s partly the company’s culture, as Google is known for encouraging employees to have fun, for giving them free food at work, massages, haircuts and more, and of course the famous lava lamps.

But as we’ve been reminded of recently, the company has a very serious side, too.

As I’m sure you have heard, the company threatened to shut down its offices in China and its Chinese-language Web site because of cyber attacks, which it believes are coming from Chinese officials who are keeping tabs on dissidents using Gmail and foreign companies doing business there.

Google has been steadfast through the years in its efforts to keep information about web users private, both here in the United States and in China. It is a core principle that the company has adhered to, so in that context, this latest development is not surprising.

But that does not mean it is any less bold. It takes guts to stand up to any national government, but it’s especially significant when you consider the potential impact on the business. China is the largest Internet market in the worldwith nearly 400 million users. The opportunity in China for Google is huge by any standard, and especially so given its relatively small market share there.

We may hear more this week when Google is reports earnings on Thursday, but this is more than “just” a business story. It is a story of privacy rights, international diplomacy, principles, and more. I’ve covered too many stories through the years of companies who either had no principles to begin with or decided it was not in their best interest to stick by them.

So whether you agree with Google’s decision or not, I think you have to respect a company that does stand for something, especially if it involves a potential cost to the business. It is yet another story that we will watch closely here at CNBC and in Investor Brief.

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