I previously commented on Google’s China launch. Since then, Google has put a post up (Google in China) on their web site in response to all the negative press and blogging they have been subject to since the China launch:

Google users in China today struggle with a service that, to be blunt, isn’t very good. Google.com appears to be down around 10% of the time. Even when users can reach it, the website is slow, and sometimes produces results that when clicked on, stall out the user’s browser. Our Google News service is never available; Google Images is accessible only half the time. At Google we work hard to create a great experience for our users, and the level of service we’ve been able to provide in China is not something we’re proud of.

This problem could only be resolved by creating a local presence, and this week we did so, by launching Google.cn, our website for the People’s Republic of China. In order to do so, we have agreed to remove certain sensitive information from our search results. We know that many people are upset about this decision, and frankly, we understand their point of view. This wasn’t an easy choice, but in the end, we believe the course of action we’ve chosen will prove to be the right one.

Launching a Google domain that restricts information in any way isn’t a step we took lightly. For several years, we’ve debated whether entering the Chinese market at this point in history could be consistent with our mission and values. Our executives have spent a lot of time in recent months talking with many people, ranging from those who applaud the Chinese government for its embrace of a market economy and its lifting of 400 million people out of poverty to those who disagree with many of the Chinese government’s policies, but who wish the best for China and its people. We ultimately reached our decision by asking ourselves which course would most effectively further Google’s mission to organize the world’s information and make it universally useful and accessible. Or, put simply: how can we provide the greatest access to information to the greatest number of people?

Filtering our search results clearly compromises our mission. Failing to offer Google search at all to a fifth of the world’s population, however, does so far more severely. Whether our critics agree with our decision or not, due to the severe quality problems faced by users trying to access Google.com from within China, this is precisely the choice we believe we faced. By launching Google.cn and making a major ongoing investment in people and infrastructure within China, we intend to change that.

I thought the decision made sense before I read this (read my post: Google Launches in China), and I still do.
Prominent Google observers still don’t see the positive in the decision. (John Battelle: The Real Irony Here).

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Google has launched the localised Chinese version of their web site, Google China, albeit not fully equipped with all features found at Google.com. Google has for a long time postponed going into China, because of the censorship restrictions imposed by the Chinese government, which Google has found incompatible with their values. Although Google.com is also censored when accessed from China, this censorship is exercised by the government and not Google themselves. Now, however, Google has followed in the footsteps of competitors Yahoo! and MSN, and launched a localised Chinese version with voluntary censorship.

Critics believe this decision conflicts with Google’s Do No Evil mantra. From a business perspective, however, the decision makes perfect sense: (1) Competitors are already in the Chinese market and more importantly (2) via the Chinese version Google now gets an inside, controlled approach to the censorship as opposed to the external censorship applied to Google.com. The latter will enable a better understanding for search and internet patterns of Chinese web users, but, in the long term, also offers the possibility of increasing bargaining power towards the Chinese government with regard to censorship.

Examples of censored searches include queries for the Tiananmen Square massacre and the—in China forbidden—Falun Gong movement.

Read more: Here Comes Google China, Google Joins Chinese Censor, and Google Makes Right China Decision.

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From Autoblog:

With more than 5.9M vehicles sold in China last year, the country has become the second-largest automobile market in the world, moving ahead of Japan (which saw 5.8M new vehicles sold in 2005). China’s sales represented 8.7% of the world market, or about double its share back in 2001.

Not surprisingly, 5.76M of those vehicles were domestically produced, as China’s market remains very difficult to crack for importers.

The market in China remains highly fragmented, with the largest producer – First Auto Works – grabbing less than 17% of the market.

One of my friends told me: “I don’t know much about China, but if you multiply anything by one billion, it’s fine with me.” This is true, but you cannot always multiply things by one billion in the case of China, whose domestic market remains very difficult to get into. Lack of regulation in some cases, over-regulation in others, and lack of a developed domestic demand (China’s growth is mainly export-driven, not driven by consumption) are real challenges, which need to be faced if one wants to even get a chance of getting close to the one billion multiplication. Given the export-driven growth, it is nice to see that consumption grows, in this case with cars. Still, domestic cars take the majority of car sales in 2005. Let’s see what 2006 brings.

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Together with 29 top graduate students, I am going to China (Google: 660m hits) in April to try to gain a deeper understanding for their culture, doing business in and with China, and to solve a specific, concrete problem of a Danish company present in China. We will also visit the facilities of a number of Danish corporations as well as we will be visiting Chinese firms.
Before going there, I will spend a lot of time on catching up, which is why I will be starting a blog post series on China containing whatever I tumble across: History, Economy, Business, Architecture, and other musings as I see fit. I will, of course, also update you more detailed on the contents of my trip, as they unveil.

Welcome to the China Exposé.

(Photograph is from the Great Wall of China.)