The tale of the Chinese skeletons in the closet and the pink elephant in the room

It’s time to wake up. It really is. Google has decided to pull out of China (more or less) and the reactions of the press have been so far quite interesting, to say the least. I will not go over these events in detail. Shortly put, Google claimed it underwent a series of alarmingly advanced attacks on its infrastructure (and its GMail service). These attacks appeared to have been led by Chinese crackers working for the government of PRC.  Google made the public move to declare it would pull out of the Chinese market, something that is considered as sheer insanity by some and a smart, calculated move by others.

I tend to think it’s a smart and calculated move by Google, as it was, among other things, noted that the company has a rather weak market share in China. By leaving the Chinese market it will not lose much, and will gain a lot of credibility and positive outlook that Microsoft has been working hard to undermine. The reaction of Steve Ballmer to the story is quite telling, and now he looks like the Borg again. But what I am quite amazed at is the amount of hypocrisy seen in the media about this issue.

Certainly, there is more that meets the eye when it comes to Google and PRC. But this story should have been the opportunity to remind the Free Market Integrists (the ones who believe Free Market actually exists and that we live in an ideal world – many of them, interestingly, were patented communists thirty years ago) that China does not play by the rules of the Free Market. China does not want to play by these rules and has slowly imposed its own rules, special labor laws, low currency, local joint-ventures, and now, a special Internet behind a Great Wall. Most companies fail to see that they will eventually lose, if that’s not already the case for some of them (the French Alcatel and Thomson companies are blatant examples of such “soon-to-be-departed” companies) and that only a few will survive a system they may have contributed to define, but one that automatically creates fierce competitors by the will of one government.

Google, for good or bad reasons, has decided it would stop to gleefully agree to whatever the Chinese leglislators would dictate, and only a few commentators have so far realized the change it has been compared to any other companies.  For the record, I am actually quite admirative of China, its culture, and how it managed to lure Western industries through greed into thinking that what they were going to get by outsourcing/working in China would automatically be a success. To some, it’s even become a duty, although they overlook the evergrowing lack of balance in our trade equilibrium with China.  Ideology has been the sickness of the twenthieth century. In our times, I am afraid ideology is still very prosperous.

But let’s go back to Google and China: Do not be shocked by Google’s move; rather, we should perhaps think at what kind of double standard in business, ethics, and politics we have to set when dealing with PRC. I am disappoined that few have noticed these skeletons in the closet, but I guess a pink elephant is always more visible than they are.