GOOGLE VS. CHINA VIVIAN LIU, LAUREN CROKE, ANN ZHENG

BASIC INFO Renowned search engine Google.com/fr/de Expand in 2005 China 2 nd highest Internet users

CURRENTLY Restricted access- ‘Great firewall’- Thus Google unreliable, inefficient and slow. Baidu. Google's stake in Baidu. Google under pressure.

THE PLAN Hired Dr Kai-Fu Lee to help negotiations.  Set up research and development centre in China. China: Access to Googles technology and research. Google: Gain presence in Chinese market (increase revenues).

Google set up in China Google remain on the outside Google Pro’s  Place in the Chinese market  Increased Revenues  More efficient Services  Achieving their goal - ‘Instant gratification’. Con’s  Abiding to legal restrictions and censorship (Decrease the value of their searches- not as thorough). Pro’s  Does not have to abide to heavy restrictions. Con’s  Offshore website would be unreliable due to firewall.  Slow.  Not achieving their goal.  Baidu takes over.  Missed opportunity for increase income.

Google set up in ChinaGoogle remain on the outside China Pro’s  Access to Google's R+D.  Enhancing their international reputation.  Create and retain many jobs. Con’s  Fear of westernisation. Pro’s  No fear of westernisation.  Censorship and restrictions under control. Con’s  Brain Drain.  Lost opportunity to access Google's R+D.

POSSIBLE OUTCOMES There are three possible outcomes for Google, they could: 1.Establishes a local domain. 2.Continues offshore. 3.Lobby the Chinese Government for a greater stake in Baidu.

WHAT TYPES OF SEARCHES ARE CENSORED/MONITORED?

GOAL: NEED TO DEVELOP A GOOD RAPPORT WITH CHINESE USERS China is a collectivist society – suspicious of foreign firms. Key learning #1: assimilation of company culture The government acts in the interest of the country at large. Key learning #2: consideration of all players

GOAL: USE OF DR LEE TO ASSIST IN OPENING NEW RESEARCH FACILITY Advantages for Chinese government  Curtail ‘brain drain’ and create new jobs  Access to key research technology Reconcile ascription and achievement societies Key learning #1: recognise ‘comfort zone’ of home party  Appeal to China’s relationship oriented society Key learning #2: importance of personal relationships

GOAL: SOCIAL AND POLITICAL STABILITY – CONFIRMING TO CENSORSHIP Google’s sacrifice Future Orientated Society Confucian philosophy Key Learning: collective identities

GOAL: ESTABLISHING A POSITIVE RELATIONSHIP WITH CHINESE GOVERNMENT Power distance community Hierarchical society Sequential v Synchronic cultures Key Learning: building relationships

SOURCES Grogan, C. and Brett, J, 2006, “Google and the Government of China: A Case Study in Cross-Cultural Negotiations,” Kellogg School of Management Kalathil, S, 2003, “China’s New Media Sector: Keeping the State In,” The Pacific Review vol 16. No. 4 pp Phatak et al, 2009, International Management, 2 nd edn., McGraw-Hill/Irwin, New York Philip P. Phan, 2005, “Hu Tightens Party’s Grip on Power,” Washington Post, April 24 Brett, J. M., 2007, Negotiating Globally: How to Negotiate Deals, Resolve Disputes, and Make Decisions Across Cultural Boundaries, John Wiley & Sons, Inc. Graham, J. L., Lam, N. M., ‘The Chinese negotiation’, Harvard Business Review, vol. 81, no. 10, p Kusyk, S. 2010, ‘Unmasking the myths: learning to navigate the rough seas of ethics’, Deep Insight, no. 5, p