Google’s Tortured Relationship with China Continues

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A new report reveals the company’s plans to enter the Chinese search market. We’ve seen this movie before. But Android has changed the game, forcing profits over corporate values.

Google’s Beijing offices in 2010, the year the company exited the Chinese market.

(Cross posted from Searchblog)

I’ve been covering Google’s rather tortured relationship with China for more than 15 years now. The company’s off again, on again approach to the Internet’s largest “untapped” market has proven vexing, but as today’s Intercept scoop informs us, it looks like Google has yielded to its own growth imperative, and will once again stand up its search services for the Chinese market. To wit:

GOOGLE IS PLANNING to launch a censored version of its search engine in China that will blacklist websites and search terms about human rights, democracy, religion, and peaceful protest, The Intercept can reveal.

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“It’s Time for Silicon Valley to Be Paranoid”

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NewCo Shift Forum 2018 — Signal P&G Talks

SVB’s Erik Peña on how China is different — and why it matters.

Erik Peña is a Managing Director in Silicon Valley Bank’s Corporate Relationship Management Team.

If you want to understand the future of business, you best study China. At the Shift Forum this past February, we asked Erik Peña to help us better understand the world’s fastest growing superpower. Below is the full transcript and video from his fascinating survey.

Erik Peña: Good evening. I wouldn’t call myself an expert in China, but I’ll give you a very quick overview on SVB to set the stage of our role in China. Then we’ll dive right into China, as soon as I figure out the clicker. There it is.

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The End of Democratic Capitalism?

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China’s One Belt One Road initiative (image)

In bowing to China, Apple forces us to contemplate the true role of business in society

“China is likely to emerge in the next few years as the world’s largest supplier of capital.” — Brookings Institute, Jan. 2017

A clash of fundamentally competing economic philosophies broke into the mainstream news this weekend, with the fate of democratic capitalism hanging in the balance. And while it’s likely too early to call a winner, the trends are certainly not looking good for democracy as we understand it in the west.*

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Apple’s China Agreement

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The Devil is in the Details

Apple has agreed that the encryption keys for iCloud user accounts for Chinese persons will be stored in China, as Reuters reported today.

If you aren’t familiar with Chinese law and the situation around this, this may seem relatively innocuous: a company is doing business in a country, and complying with that country’s local laws. What’s significant about this is that it represents a major change in how legal process works.

Shanghai from a Different Angle,” by sama093
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Govt. To Journalism: Screw You.

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Money Quote Friday Nov. 10

The contradictions are rife in the FCC’s latest regulatory framework, and did Justice seek revenge on CNN?

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In a New York Times OpEd (apparently he’s OK with purveyors of “fake news”), FCC Chair Ajit Pai makes a case for loosening rules that bar cross ownership of print and broadcast media assets. And on its face, his arguments make sense. But look closer. Pai is arguing that the Internet provides more diversity of views, and that when a TV station owns a paper, the community gets more investment in news gathering, reporting, and coverage. Maybe, but he’s ignoring the real issue at hand: That “diversity of views” so dear to past regulators is pretty much dead and buried on the Internet, where filter bubbles, marketing algorithms, and sophisticated information warfare ensure most Americans see only what they already believe, and ownership is concentrated beyond anything we’ve seen in the offline media world. And guess what? Earlier this year, the FCC shrugged off responsibility for any regulatory power over the Internet. Money quote: “In 2003, this newspaper noted on its editorial page that “making the argument that the current rules are outdated is easy.” The case is even stronger today. Few regulations are more disconnected from today’s realities than the F.C.C.’s media ownership rules.”

Did President Trump ask the Department of Justice to punish CNN by forcing AT&T to divest the news network so its acquisition of Time Warner would be approved? Sounds nuts, but that’s exactly the kind of thing our current president seems capable of doing. AT&T isn’t taking this one lying down, and is threatening to sue. Now that’s a court case I’d like to see! Money quote: “Randall L. Stephenson, AT&T’s chief executive, said on Wednesday that he had never offered to sell CNN. On Thursday, appearing at The New York Times’s DealBook conference, he said the company was ready to go to court against the Justice Department.” Counterpoint: Tim Wu argues blocking the deal might be a good idea.

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China Takes Over The World

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Money Quote Thursday Oct. 26

Is Xi the most powerful man in the (sort of) free world?


China is dominating this week’s news, thanks to the canonization of its communist party leader. Xi has taken the mantle as “the most powerful leader in the world” — note the lack of the word “free” in that statement. Thanks, Trump. Money quote: “China is quickly growing into the world’s most extensive commercial empire. By way of comparison, after World War II, the Marshall Plan provided the equivalent of $800 billion in reconstruction funds to Europe (if calculated as a percentage of today’s GDP). In the decades after the war the United States was also the world’s largest trading nation, and its largest bilateral lender to others. … Now it’s China’s turn. The scale and scope of the Belt and Road initiative is staggering. Estimates vary, but over $300 billion have already been spent, and China plans to spend $1 trillion more in the next decade or so.”

If this isn’t building hotels, I don’t know what is. It’s interesting to see how non-traditional disruptors eventually end up being in the same business as those they disrupt. The Florida-based building is not a hotel, per se, but an apartment complex optimized for sharing (it still has residents). Money quote: ““Right now we’re focused on Florida, but we’re considering other markets,” he says. “We are looking to be present in many other cities across the U.S.” That makes sense. The very cities where rents are high also tend to be places where tourism is robust. Armed with a building offering that helps residents offset their rents, Niido may provide the edge that Hernandez would need to expand his business across the country–while helping Airbnb with a new source for listings.”

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All You Need to Know About China: Party Congress, Surveillance, and Becoming the Intelligent…

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I often mention China in my weekly newsletter about exponential technologies and society, but I’ve been acutely aware that this can barely do it justice. I’ve asked my friend, David Schlesinger, to shine a light on the Middle Kingdom during these times of change.

David and I first worked together at Reuters over a decade ago, at which point he had spent more than 20 years working in the region. David went on to become editor-in-chief of Reuters, the world’s top newswire, before taking up a post as Chairman of Reuters in China. Now based in London, he runs Tripod Advisors, which helps companies understand the region. He also has an Emmy Award, which I think is quite cool.

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Bears and Dragons Bite Tech Where It Hurts

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Thanks to Trump, Russia and China Ban Virtual Private Networks, and the Internet Loses in the Process. Plus: Uber! & Forum!


It’s hard to pay attention to much more than our own domestic tragicomedy lately, but as we pointed out earlier in the month (final item), there’s trouble afoot abroad for the tech industry, particularly in China. And over the weekend, Russia added its voice to the chorus of countries rejecting American tech giants.

Both Russia and China have been the subject of abuse from none other than our commander in chief, who this past weekend both tweet-primanded China over North Korea, and also announced his willingness to sign a new bill sanctioning Russia. Rarely does retaliation from two of our most cherished antagonists take such a distinctly similar response: they both banned virtual private networks, technology that allows millions of citizens access to otherwise banned or sensitive information. Was the target American business and expats living abroad? Certainly that’s got to be part of it.

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Google and Amazon Hit the Feed Trough

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NewCo Daily July 19 2017

The Big Five in tech are eating each others’ lunch

When the top five companies by market cap are all roughly in the same business, they’ll inevitably start going after each other’s core business. As for startups working on adjacent markets? As long as those markets are large enough, or support one of the Big Five’s larger business goals — well they’re just an hors d’oeuvre.

While Facebook has been aggressive in the past (its Instagram and WhatsApp acquisitions all but insured Twitter and Snapchat’s woes), Google takes this week’s crown as the most omnivorous of the bunch. Not only is the company taking on Microsoft’s LinkedIn with its new Hire service, its also shaking Facebook’s core moneymaker — the newsfeed. Yesterday Google announced a new newsfeed product that looks and feels an awful lot like Facebook’s newsfeed product — minus the baby pics and kitten videos (and, one presumes, the fake news). Built on top of Google’s massive knowledge of its customers’ preferences, search history, and app usage, the newsfeed product has a decent chance of stealing valuable attention from Facebook’s core customer set (and, let’s face it, Twitter is most likely not pleased with this development as well).

And while Google takes this week’s crown, Amazon’s also bellying up to the lunch buffet. A report in Quartz this weeks notes that Amazon recently filed a trademark for the tagline “We do the prep. You be the chef.” That sank Blue Apron’s newly minted stock to all time lows —and the beleaguered startup’s only been public for a few weeks. Not content with spooking the entire home grocery market (remember, it recently bought Whole Foods), Amazon also announced Spark, a shopping service cum social network that, you guessed it, takes the form of a feed that looks an awful lot like Instagram. Only Amazon Prime members can post products to Spark, but any Amazon customer can browse and buy from the “shoppable” feed. While press reports focused on Spark as a challenge to Facebook’s Instagram, it’s likely that executives at Pinterest are sleeping less soundly this week as well.

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Apple’s $1B for Advanced Manufacturing Is Just Dressy PR

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NewCo Shift OpEd

And the company’s not alone in playing the game

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Apple CEO Tim Cook appeared on CNBC last week to deliver some big news: The Company That Steve Jobs Built is placing $1 billion into a fund, which will then be invested in advanced manufacturing companies in the United States. This will presumably help Apple source more components for its computers and phones here.

“We can be the ripple in the pond,” Cook told Jim Cramer. “Those manufacturing jobs create jobs around them, because you have a service industry that grows around them.”

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