Competition has nothing to do with it. But collectively, the hacking, the Green Dam, so called "porn" related crackdowns, required government registration and approval of websites, banning of everything like YouTube, WoW, Facebook, Twitter, Wikipedia, etc,. is turning China's Internet into an Intranet and cutting it off from the rest of the world.
China's Internet development is actually devolving. Don't ever think its good. Forums like this and others depend very much on a free Chinese Internet and webizens that are allowed to post pictures and say things.
Google's plan to withdraw from China may be as much about poor business prospects as ethics
Jan 13th 2010 | BEIJING
From Economist.com
“WE’RE in this for the long haul”, wrote a Google executive four years ago when the internet giant launched a self-censored version of its search engine for China. Now Google says it might have to pull out of the country because of alleged attacks by hackers in China on its e-mail service and a tightening of restrictions on free speech online.
Google’s “new approach to China”, as the firm’s chief legal officer, David Drummond, called it in an official blog posting on Tuesday January 12th, will infuriate the government in Beijing. Official sensitivity to foreign complaints about internet controls in China was evident in November during a visit by President Barack Obama. His obliquely worded criticism of online censorship was itself expunged from official media reports. If the firm were to quit China, Google would be the first big foreign company to do so while citing concerns about freedom of speech.
Mr Drummond’s posting also involved unusually direct finger-pointing by a foreign firm at China as a source of hacker attacks. He said that in mid-December Google detected a “highly sophisticated and targeted attack” on its corporate computer systems “originating from China”. Its investigations found that at least 20 other large companies from a wide range of industries had been targeted. A primary goal, he said, appeared to be to gain access to the e-mail accounts of Chinese human-rights activists who use Google’s Gmail service. The hackers managed to penetrate partially two accounts.
The Gmail accounts of dozens of other advocates of human rights in China based in America, Europe and China itself had also been “routinely accessed by third parties”, Mr Drummond wrote. Unlike the mid-December attack, these breaches appeared to involve phishing scams or malware on the users’ computers rather than direct attacks on Google’s systems. He said these attacks, combined with “attempts over the past year to further limit free speech on the web”, had led Google to “review the feasibility” of its business in China.
The company has decided to stop censoring the results of Google.cn, its China-based search engine. Mr Drummond said this might result in having to shut down Google.cn and Google’s offices in China. In the face of much criticism from Western human-rights advocates, Google justified its decision to set up Google.cn in 2006 by pointing out that China often blocked its uncensored Google.com search engine. Better to offer a censored service (with warnings to users that results were filtered), the company argued, than offer nothing at all. China would certainly not allow an uncensored search engine to be based on its territory.
In Silicon Valley, the home of Google, the decision has been widely applauded. But some are asking whether it was “more about business than thwarting evil” to quote TechCrunch, a popular website. Despite its concessions to the Chinese government, the argument goes, Google had not made any headway against Baidu, China's leading search engine—and probably never will. In any case Google's revenues in China are “truly immaterial”, according to Mr Drummond, and its costs are not. It employs about 700 people in China, some of them royally paid engineers. Hacker attacks and censorship, critics say, may be convenient excuses for something Google wanted to do anyway–without it looking like a commercial retreat.
Nor had Google’s acquiescence to self-censorship of its searches made China any less wary of the company’s other, non-censored, services. Google’s video-sharing site, YouTube, has been blocked since March, because it carried footage of Chinese police beating Tibetan monks. Its photo-album site, Picasa Web Albums, has since suffered the same fate. Access to Google’s blog service, Blogger, has long been intermittent. (It is currently unavailable in Beijing.)
Google’s frustrations are widely shared. Before the Olympic games in Beijing in August 2008, China lifted longstanding blocks on several websites in an effort to present a more open image to visitors. Since then, controls have been stepped up to unprecedented levels. Internet access throughout the western region of Xinjiang has been all but cut off since the eruption of ethnic riots there in July. The unrest also prompted a nationwide closure of foreign social-networking sites such as Twitter and Facebook.
The role of such sites in Iran’s upheaval in June had already alarmed the government. Its fear of dissent erupting around the 60th anniversary in October of the founding of communist China prompted even greater vigilance against sensitive debate online. Since then there has been no sign of relaxation. In recent weeks, officials have tightened restrictions on the registration of websites under the .cn domain name (businesses only may apply). A crackdown on internet pornography has led to closer scrutiny by internet-service providers of non-porn websites.
In December, Yeeyan, a site providing translations of articles from foreign newspapers including the Guardian and the New York Times, was closed down for several days. It was allowed to reopen after putting tighter controls in place on the publishing of politically sensitive pieces. Ecocn.org, a site offering Chinese translations of articles in The Economist, was also shut down briefly as officials trawled for pornography, but re-emerged unscathed. The volunteers who maintain the site make sensitive articles available only to users they trust.
The anti-porn drive turned up the heat on Google too. Last year Google.cn was among several search engines in China accused by the authorities of providing links to pornographic sites. The state-controlled media gave particular prominence to Google’s alleged transgressions, which the company promised to investigate. The Chinese media have also published frequent criticisms in recent months of Google’s alleged violations of Chinese copyright in its Google Books search facility.
But China is clearly fearful that the company’s stand against censorship will be celebrated by many Chinese internet users. Chinese news accounts of the company’s decision failed to mention the reason for Google’s actions. Chinese web portals buried the story. Many internet users in China have become adept at finding ways of circumventing China’s blocks on overseas websites, including the installation of “virtual private network” software. Numerous tributes to Google that rapidly appeared on Chinese internet discussion forums, and flowers laid outside Google’s office in Beijing, showed that the authorities’ attempts at censorship had failed. Few, however, believe that the company’s announcement will dissuade China from keeping on trying.
BTW, is sinodefenceforum accessible from China?