VIEWS: 5 PAGES: 3 CATEGORY: Business & Economics POSTED ON: 6/29/2010
Google's rancorous dispute with the Chinese government has brought into the open an often-neglected fact about doing business in China: the free-market values that drive the country's economic growth -- and attract Western firms to the Chinese market -- conflict at a fundamental level with the basic impulses of its political system. Ironically, the contretemps has occurred in a time during which economic and cultural developments are making China's market for high-tech products and services increasingly attractive. In recent years, under pressure from the international community and Western technology firms, the Chinese government has altered both patent laws and its enforcement of them in such a way as to protect the intellectual property of overseas companies more effectively than in the past. Google had agreed to censor its China search engine in some ways in exchange for government permission to enter the market in January 2006.
Views and News of the Current mandated when China joined the Research–Technology Management Scene International Trade Organization has meant clearer recognition of MaryAnne M. Gobble, Editor international patent law and better enforcement of patents. “Overall the patent laws have certainly been Google’s Experience Raises Doubts improved,” says Xiang Wang, a partner in the Beijing ofﬁce of IP law About High-Tech Business in China ﬁrm Orrick, Herrington & Sutcliffe LLP. “And despite the complaints from Western companies, China has improved its enforcement.” G oogle’s rancorous dispute with the Chinese government has brought into the open an often-neglected fact Scientists and engineers are not the only individuals to beneﬁt from advances introduced into China from Several companies under cyber attack about doing business in China: the overseas. A rapidly growing middle The cyber attacks on Google jolted that free-market values that drive the class is eager to buy and use the optimistic picture. And Google was country’s economic growth—and products of technology ﬁrms, and plainly not the only target of the recent attract Western ﬁrms to the Chinese estimates indicate that more than hacking. “We discovered that at least market—conﬂict at a fundamental 20 other large companies were similarly 300,000 Chinese citizens currently use level with the basic impulses of its targeted,” says Google spokesman Jay the internet. Spurred by technological political system. The affair that Nancarrow. Investigations by other growth, the Chinese economy has erupted in January has revealed to a organizations have increased that survived the ﬁnancial meltdown of the number to at least 34. worldwide audience the strains that past 18 months more successfully than have marked relationships between those of Western nations. Other issues in the past 12 months Western high-technology companies have increased concerns about the and the government since the In recent years, under pressure from Chinese government’s attitude to companies ﬁrst entered the China the international community and foreign ﬁrms. Western companies market. But Google’s threat to pull Western technology ﬁrms, the Chinese have long complained of difﬁculties in out of China if the government government has altered both patent obtaining permits and competing doesn’t allow it to reveal uncensored laws and its enforcement of them in against Chinese companies, but they results on its Chinese search engine such a way as to protect the have now begun to sense tighter (Google.cn) escalates the intensity of intellectual property of overseas restrictions on their activities. Last those disputes. And the reason for companies more effectively than in year, the government ordered vendors Google’s threat—evidence of the past. A series of advances selling personal computers in the cyber-attacks intended to gain access to the company’s software code and the e-mail accounts of human rights activists—raises questions about the ability of any overseas company operating in China to protect its intellectual property, and thus to compete against Chinese companies on a level playing ﬁeld. Ironically, the contretemps has Image is available only in print edition occu
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