Google_china

    Sometimes
the most illogical business decision is the right decision for the brand. This
is certainly the case for Google.

    Google
is pulling its company out of China, the biggest internet market in the world.

    Sounds
illogical and crazy to me and most leaders. But it is the right call for
several reasons.

 

1. Google wasn’t winning in China anyway.

    Google
is the most popular search engine in the world and dominates the market in most
countries, except China.

    Why
is that? It’s simple, Google was late.

    Google
only entered the Chinese market in 2006. Even a brand as powerful as Google is
at a huge disadvantage if it isn’t first. Baidu was the first search engine in
China and it is seen as the real thing in search with over 77% marketshare. By
contrast Google has only around a 12% share.

Google china share

    Of
course, even a small share in a county like China adds up to a lot of users.
China has the world’s largest online population with over 300 million people
using the Internet, a figure that is expected to soon exceed the entire U.S.
population.

    Google
has had success with one part of the Chinese market; younger and more educated Chinese
users tend to prefer Google. But Google has not succeeded in getting the
general Chinese population on board.

    Google
also is losing in Russia to a brand called “Yandex,” in South Korea to a brand
called “Naver.” And in Japan to Yahoo. In all three countries, Google wasn’t
first.

 

2. Google has a flag to carry. And is getting a lot of
PR.

    Google
equals “search” in the minds of consumers across the world. But what does “search”
really mean? The dictionary definition of search is “the activity of looking thoroughly
in order to find something.” You ask Google to search for something and it
does. Google searches for it, finds it and delivers it to you.

    It
does that everywhere except in China of course. In China the government censors
information. In China most internet users can’t even access this blog. It is
crazy, scary yet true.

    In
most of the world, the value of freedom of information is highly regarded.
Probably in no place more so than the United States of America. Freedom, democracy
and free markets are our core values.

    China
has realized the power of free markets and since opening up its economy has
seen great rewards. But information is not free at all in China.

    As a
company focused on search, it is in Google’s best interest to fight for freedom
of information around the world. The media has certainly rewarded Google’s fight
with China with a massive amount of media coverage. There have been multiple
front-page stories in the Wall Street Journal, New York Times and many other
publications around the world.

 

3. Freedom will eventually win.

    Google
is picking the “freedom” side in this fight. In the short term, Google is going
to suffer a loss of sales. But in the long term, Google is strengthening its
focus on search and freedom. Around the world most people respect the idea that
the Internet should be a place of freedom of information. Access to information
should not be filtered by any government or any group.

    Because
of its stand in China, Google benefits now in other markets. And if history repeats
itself, freedom of information will eventually come to China. When that happens
Google will be ready to claim itself the real search engine.

 

4. Age doesn’t always equal wisdom.

    According
to the Wall Street Journal, Google’s decision to leave the Chinese market involved
a heated debate with CEO Eric Schmidt in favor of staying and the two young
co-founders of the company, Larry Page and Sergey Brin, in favor of saying “zai jian,” Chinese for goodbye.

Eric-schmidt-larry-page-sergey-brin-google

    Don’t
tell my father, but sometimes kids are right. Schmidt was probably looking at
the numbers while Larry and Sergey were looking at the message. Pulling out
means losing millions but it also says what Google is willing to fight for.

    Sometimes
the best decision for a company to make is based on gut instincts rather than
spreadsheets.

    Sure,
Google will lose a few dollars in the short term, estimates say up to $600
million in lost sales.

    But
in the long term, standing up against censorship and promoting freedom of information
will likely bring great rewards in the hearts and minds of the world.