Fri, Mar 26, 2010 - Page 1 News List

Google deals in doubt amid PRC spat

AP, BEIJING

Google’s business ties in China have unraveled a little more amid a backlash to the firm’s decision to move its Chinese search engine offshore in a challenge to the country’s online censorship laws.

While Google’s stand is winning it praise in the US and other countries, it’s threatening to turn the company into a pariah in China.

More of its partners and advertising customers in the country appeared to be distancing themselves from the company. China’s second-biggest mobile phone company is scrapping plans to use Google’s search function on two new phones, while the country’s most popular Internet portal is reviewing its partnership with Google.

Google still hopes to expand its non-search operations in China, but its refusal to play by the government’s censorship rules could make that unrealistic.

By challenging the government, Google appears to have violated an unspoken rule of doing business in China, especially in the Internet industry — whose control Beijing sees as crucial to maintaining its authoritarian rule.

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