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U.S. TECHNOLOGY COMPANIES IN CHINA: CONTROVERSY, LEGISLATION, & IMPLICATIONS FOR CORPORATE DIPLOMACY
JUN 28, 2006 - 4:20PM PDT
by Jade Miller
Peter Winter also provided research support for this report. Over the past two years, Cisco, Microsoft, Yahoo, and Google have entered the Chinese Internet market, providing online or information-related products utilized by the Chinese government to enforce Chinese information censorship laws, conduct online surveillance, and restrict access by Chinese citizens to certain internet sites. Cisco Systems, for instance, sells equipment that enables online surveillance in many markets, one of which is the Chinese police. The Google product that has generated controversy is Google.cn, its search engine based in mainland China. Its location on Chinese soil means that Google.cn filters search engine results to abide by Chinese censorship laws, censoring some results for "politically sensitive" terms such as "democracy," "Tiananmen," or "Falun Gong." Censored search results are accompanied by a notice alerting the user to the absence of some information on the page. Microsoft's China controversy stems from censorship on its Chinese blogging tool. One well-known blog (by "Michael Anti" ), hosted on servers located on American soil, was removed in response to a request from the Chinese government. Additionally, searches for "democracy," "human rights," and other terms which are considered "politically sensitive" in China are rejected outright by the system. Yahoo also offers blogging services to mainland China internet users, but does so through a Chinese server. On at least one occasion, Yahoo released to the Chinese police, at their request, identifying information about a dissident blogger using a Yahoo blog. This blogger, Shi Tao, was later arrested and imprisoned with the aid of this information. Public outcries against these IT companies first emerged in the blogosphere and among human rights organizations. Editorial and op-ed pieces in the mainstream news media soon followed, reaching critical mass in the Fall of 2005. In response to these criticisms, in February 15, 2006, Representative Christopher Smith (R-NJ) led a Congressional subcommittee which conducted hearings featuring testimony from all four IT companies defending the conduct of their respective organizations. One day later, Rep. Smith introduced the HR4780, a bill, still under consideration, which would make many of the current censorship-oriented operations by the four technology giants illegal. If passed, this bill will, in effect, preclude U.S. IT companies from operating in any countries with internal restrictions. Proponents of the bill argue that service provision to countries such as China who engage in censorship is not only morally reprehensible for American firms but it should be made legally untenable as well. Responses to the issue and the proposed legislation has been fairly uniform. Some have pointed out that this controversy is bad publicity for China, as it has brought their information management and control practices into the international spotlight. Others have focused on the negative implications for the American and world economy if GOFA passes. Most of the discussion, however, has focused on the responsibility of American corporations to represent the moral values of the United States when doing business abroad. After recent controversies over the morality of business practices in other areas, such as…... FULL TEXT
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Ernest Wilson on August 2, 2006 @ 8:55 am:
Google's "Foreign Policy"
Some thots on the foreign policy responsibilities of Amerian companies - and the American Congress - when they try to deal with hi tech companies in China.
(drawn from an earlier blog, americaabroad.tpmcafe.com)
By Ernest Wilson
It was bound to happen. The iconic flag ship of our voyage into the digital age runs up against the hard realities of state power and international relations. Google is in a major flap over its deal with the Chinese government to censor itself. Internet naivete gives way to global realpolitik. Congress holds Google hearings next week. Now what happens to Google’s ‘foreign policy’? And what, if anything, should the American government do? This case foreshadows the complexities of designing ‘foreign policy’ in the digital age.
The government of China recently imposed requirements on Google mandating that they block access to certain sites the PRC deemed objectionable. According to its spokesmen, Google wrestled with the decision and then opted to accede to the government’s demands. In their desire to play in the world’s biggest market, Google followed similar compromises by Microsoft and other ‘new economy’ firms.
The reactions were swift, salty and predictable. The new firewall created a firestorm of outrage among human rights advocates, some IT experts and China watchers who frequent the blogosphere. ‘Sell out’, ‘anti- democratic’, ‘evil’, ‘shameful’ and other terms of derision have been bouncing around the blogs for weeks. They claim Google turned its back on the web’s great potential for political liberalization, and reversed Google’s own corporate commitment to openness. It was especially surprising on the heels of the company’s recent decision to resist U.S. government requests for access to Internet use patterns among Americans. Some claimed that Google’s capitulation would egg on the Chinese Communist Party to demand even more repression. The search engine/ information management company policy also runs against the new rhetorical stance of the Bush administration, touting ‘democracy’ abroad.
Google responded by arguing they chose to keep their doors open to the wider world even if open only 80% instead of 100% of the content got through, because if they didn’t the government would slam the door shut and 100% would excluded rather than 20%. Their other line “While we don’t particularly like the law, it is the law of the land and we have to obey.”
The flap raises important questions about the conduct of public and private diplomacy where the real and virtual sometimes collide. It’s especially complicated in this sector because it happens at the intersection of traditional trade issues, virtual trade issues, and human rights.
Google’s choices are hardly unique. Multinational corporations have always faced issues of territoriality and local vs.‘ home’ obligations. U.S. companies in Europe have to obey local labor laws they don’t like, and Japanese car manufacturers obey U.S. affirmative action requirements. At one level, this is nothing new. Companies are in the business of making money where they can, bound by the local legal restrictions.
However, this is also happening in the digital world where borders and jurisdictions are blurred at best. Think of the big dust-up over European attempts to restrict the sale of Nazi paraphernalia on the Internet. So does Google really have to obey? Apparently yes, since they moved their host servers to China, (to improve the quality of service and probably to impress the Chinese with their local loyalty). But international fights in cyberspace do cloud matters of where ‘local’ really is.
And after all, we’re not just talking sports cars and shampoo. These are fights over the control and censorship of the media, of who gets access to what information, on what terms. Whenever we confront basic human rights and freedom of expression it raises the stakes. Furthermore, the consequences of the corporate actions of a Google, Yahoo or Cisco for Chinese citizens may be arrest and worse, not to be taken at all lightly.
This is new territory for companies and governments. Google, like Microsoft and other new economy companies are trying to figure out what to do. They are taking the usual steps, including lobbying the feds to raise concerns about access, claiming censorship is a restraint on trade; holding meetings of industry associations to come up with common standards for operating in restrictive environments; and meeting with various stakeholders in the U.S. and China.
All this seems sensible. Pressing at the limits of the acceptable to advance democracy is a good thing, keeping in mind that local definitions do vary, and democracy, like Rome, was not built in a day. Google’s digital diplomacy, like America’s foreign policy, has to find that balance.
Jasmine Addo on October 5, 2007 @ 11:11 am:
Report on china,
jamie yavis on December 27, 2007 @ 7:12 pm:
You have just discoverd the tip of an iceberg and a little more research will show that there are a lot more than tech IT companies involved in China / U.S. / Europe commercial interests.
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