Thursday, January 14, 2010

Google and China

While many have touted Google as some great storehouse of the collective knowledge of the world, my personal take is somewhat different. Unlike the majority, I have actually done business with them. I was never impressed with the R.O.I. (Return on Investment) from Google's adds. They did generate exposure, but for a small company run on a micro-budget that exposure did not translate to positive cash flow.

For the big firms who can afford to pay for exposure that does not generate income, Google's socioeconomic discriminatory bidding practice and other whitewashed policies are acceptable. For the small business owner it is simply another way to sell the sizzle and not the stake. The sizzle in this case is the hype that being listed in Google will generate an R.O.I. that translates to a livable income. Those who love Google never really used their services.

Let me put it this way: My books sell for $6.95. My cut is between $1.00 and $3.00 a book (I think) depending on the source of sale. Those sold through Amazon pay me $1.00 a book. To generate 1000 hits to make a sale Google charges about $50.00. So, I can spend $50.00 to generate between $1.00 and $3.00 in income. Mind you, the work has had some decent reviews. I'm sorry, I am not impressed.

So now Google is threatening to back out of China. Why? And who cares? Google bowed to the will of a Communist Dictatorship the way Chamberlain bowed to the Nazis. They cut the deal.

From what I can piece together it was something akin to "We will work with you on your terms if you do not attempt to hack our services." Low and behold, as the Nazis betrayed Neville, and later Joe Stalin, the Communist Government of China betrayed Sergey Brin. Go figure. The Chinese have hacked Google.

Whenever one gets involved with a business arrangement with a power hungry dictatorship, one is going to be betrayed. It is inevitable. I guess the Chinese have decided they don't need Google's services anymore. If the Chinese are sophisticated enough to hack Google (and Yahoo according to a related story) then they are probably sophisticated enough to write a competing web browser for internal consumption. Nationalism, as I pointed out in Wealth, Women and War, will rise in the end. We are seeing it all over the world even as we still tout the superiority of the Globalized model. The only thing that remains is for Brin, Larry Page, and Eric Schmidt to decided if they are Americans, or merchants. It is their decision.

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