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Google and the Government of China: A case study in Cross-Cultural Negotiations Develop a negotiations planning document using the Kellogg format in Exhibit 11 IssueGoogleChinese government Purpose of negotiationPriority: 1Position: focuses on profit and brand management Priority: 2Position: technological, economic gaining Interests: A population of 1. 3 billion along with a growing economy makes Chinese market extremely important for Google to enter Interests: It wants Google to provide its citizens and companies with the access to the very best technology, eventually, an achievement of technological parity with the US.
Also, China knows the nation’s economy will be improved by internet access and use. Level of censorshipPriority: 2Position: doesn’t want to comply with the level of censorship required by ChinaPriority: 1Position: Requires Google to comply with China’s level of censorship Interests: The image of Google in the media and among investors will be seriously damaged if it act antithetically to its philosophy of “Don’t’ be evil” It might affect negatively to the future prosperity of the company. Interests: China’s leaders desire to improve their nation’s economy while preserving political stability.
They want to censor political discussions to prevent “westernization” of China, Timing of Google acquiring Chinese domainPriority: 3Position: Google wants to acquire “. cn” as soon as possible before firms from other countries step in. Priority: 4Position: China also wants to work with Google, sooner but it is not as much urgent for China Interests: The sooner it could distance itself from its American roots by adopting “. cn” domain, the sooner it becomes a member of “in-group” in Chinese culture which will lead to greater revenue streams.
Interests: China is already working with other American companies such as MSN or Yahoo, so this negotiation is not so critical for China than it is for Google in time wise. ServicesPriority: 5Position: Google might want to provide China with only minimal number of services Priority:6Position: The Chinese government would want to be provided with all the services Google normally offer. Interests: If Google also provide services such as Gmail, chat rooms or blogging that involve users’ personal information, The Chinese government could abuse the information that Google provides as it did with Yahoo.
This will critically damage its principle of “Don’t be evil”Interests: China wants to maximize Chinese engineers’ access to Google’s proprietary research technology. China would not want to be limited on the number of services. Saving-face issuePriority: 4Position: Google does not want to appear as a company that strengthens a government that violates human rights Priority: 3Position: China wants to enforce Google the same level of censorship so that it can appear to the world as an independent and powerful actor in the global marketplace.
Interests: Google got famous for its seemingly rigid adherence to utopian ideals. If it turns out to be false, harsh criticism will be unavoidable, which may lead to reduced revenue. Interests: The Chinese government is head of a hierarchical culture that value status, seeking to promote China as a powerful and independent actor in the world forums. Notifying user when censored. Priority: 6Position: Wants to notify users every time their search censoredPriority:5Position: Does not want to notify
Interests: By adopting this, Google will be able to minimize potential freedom violation issues and also alleviate media criticism. Interests: This might threaten political stability of China. BATNALobby China for access to a larger stake in Baidu, and seek other means to enter secure Chinese users. Rely on Baidu and other local search alternatives Reservation PriceWalk away point can be where Google need to completely comply with the level of censorship that the Chinese government requires.
That is, the point where the potential damage due to bad reputation is to outweigh the potential gain of entering Chinese market. The point where Google does not comply with the minimum level of censorship required for public opinion control Explain the priorities that you see for the Chinese government and Google, and discuss their respective BATNA. Many critics say that giants like Google should put pressure on China to change its media censorship, but I don’t think Google have very little leverage to do so. The first priority for Google is its potential profit that can be achieved by entering Chinese market.
China has a population of 1. 3 billion with a growing economy, which represents an enormous market for the future of Google. It is estimated that there are around 111 million regular internet users in China, which makes it the second largest internet market in the world. For Google, China market is simply too important to miss out on, in spite of any possible costs. Acquiring Chinese domain as soon as possible is its number one priority. On the other hand, granting Google “. cn” is not the most important thing for the Chinese government.
It is without question that China sees working with Google, one of the most visited sites, very attractive. China should be well aware of economic and technological advantages that Google will provide. However, preserving political stability is even more important for China’s communist government. Furthermore, China is already working with other American top internet sites such as Yahoo and MSN. Therefore, it is quite reasonable to assume that China will not work with Google unless Google comply with China’s level of censorship. In addition, while Google need to obtain “. n” domain as soon as possible before other rivals come into play, time issue is not as critical for the Chinese government. By compromising with the Chinese government, Google’s philosophy of “Don’t be evil” will be unavoidably damaged. Even though protecting the company’s image and its philosophy is definitely very important for Google, I think it is less important than failing to entering Chinese market and losing potential profit. All above factors give the Chinese government enormous bargaining power over the negotiation with Google.
BATNA for China would be to continue to rely on local search engine alternatives such as Baidu. Baidu is already one of the most visited sites in the world (number 4) with increasing market share, and very similar to Google in substance and style. By just choosing its BATNA, China may lose some of potential economic and technological advantages, but will have much fewer domestic repercussions. On the other hand, BATNA for Google is far less attractive. Instead of acquiring Chinese domain, Google could just lobby China for access to a larger stake in Baidu, maintain its philosophical integrity.
However, Google will lose market share of Chinese users due to user frustration coming from still slow access, and Google’s revenue from China would be seriously limited because it will not be able to have a complete control over Baidu whatsoever. What ethical dilemmas do you foresee for Google? Is there any way to resolve them? Americans believe that company should not strengthen regimes that suppress freedom and violate other human rights. Google has been especially admired for its corporate principle of “Don’t be evil”.
It even refused to provide user information to the US Government case against child pornography citing the importance of User privacy. (O’Rourke IV, Harris, Ogilvy 2007) Therefore, if Google decides to comply with China in censoring search results, it would make it appear hypocrite and will damage its image significantly. On the other hand, Google also have moral responsibility to increase knowledge and spread information to enhance Chinese people’s freedom and prosperity, by providing the greatest access to information to the greatest number of people.
In a long run, the simple availability of the internet, even if limited in scope, can be a powerful engine spurring democratization. (O’Rourke IV, Harris, Ogilvy 2007). In addition, according to Google’s policy, the company also should abide by local laws and regulations, as it does in France and Germany. In short, there is an ethical dilemma between suppressing people’s freedom by censoring results but still providing good amount of knowledge and information for a long term benefit, also abiding by local laws, and protecting corporate philosophy but failing to provide any information for the Chinese people.
I think it is extremely hard to resolve the dilemma. If Google wants to enhance Chinese people’s freedom and prosperity in a long term by entering Chinese market, censorship seems to be inevitable. In a short run, however, the harm caused by censorship will be great to the freedom of Chinese people, and may be too great even considering potential long-term advantages of providing knowledge and information. I think even minimal compromise with the level of censorship China demands will lead to a great damage for Google’s integrity.
I don’t really see good ways to completely resolve the dilemma. Do you see any potential for an integrative agreement that creates value for both parties? I think both parties can find agreement on the level of censorship. The last thing Google want is to abandon Chinese market, so it would want to enter Chinese market even at cost of some of its integrity. The most important task for Google is to minimize the harmful ramification after they comply with the level of censorship required by the Chinese government.
Google can do this by negotiating with China on a number of conditions that would save its face. For example, Google would want to notify Chinese users evertytime their search has been filtered, while continuing to run the Chinese version of their unfiltered US site, so that people may look up those results in unfiltered site if they want to. Also, Google also might keep limiting services on Gmail, Chat rooms and blogging that involve users’ personal information of Chinese users, so that the Chinese government can not use it to punish people and to avoid human right violation.
This way, Google can secure profit from Chinese market while avoiding a confrontation of such level of furor that Yahoo had faced when the information it turned over to the Chinese government was used to sentence people to prison terms. By complying with the the Chinese government but also having such protection features, Google can enter Chinese market and maximize its profit while minimizing harmful effect by differentiating itself from other companies such as Yahoo and MSN.
China, also, will be able achieve economic and technological advantages by working with Google while still controlling public opinion. By restricting Google by censorship, with minimal compromises on some services, China will be able to affirm its status as an independent actor in the global marketplace as well. Work Cited: James S. O’Rourke IV, Brynn Harris, Allison Ogilvy: Google in China: government censorship and corporate reputation Journal of Business Strategy Vol. 28 NO. 2 2007