Recently an event occurred that could change the faces of both the real world and cyber world. Google Inc. revealed that its company, and at least 20 others, was victim to a “highly sophisticated and targeted attack” focusing on email and intellectual property. They believe these hackings originated in China and occurred around mid-December of 2009. In response, Google decided to no longer allow censorship of its Chinese search engine; a move that may very well lead to Google leaving China all together.

I repeat: China hacked Google; Google disallowed censorship. HUH? I am not quite sure how Chinese hackers and censorship are connected here. Google attempts to tackle this question, saying that “These attacks and the surveillance they have uncovered–combined with the attempts over the past year to further limit free speech on the web–have led us to conclude that we should review the feasibility of our business operations in China.” As you see they clearly fail to explain how the two are connected.

In wake of this controversy Google Inc. Chief Executive Eric Schmidt said, “We hope that will change and we can apply some pressure to make things better for the Chinese people.”

Forgive me but when did Google become the caretaker of the Chinese people? Google opened in China in 2006, 3+ years they have been relatively silent about accepting China’s censorship laws. So I don’t think the Chinese people are the top concern. So what is?

What it boils down to is reputation and money. Google Inc. can not come out of this without losing face. Some reports say that Google feels the Chinese government is secretly behind this hacking. Google is not only trying to look positive but hurt China in the process.

Google needs to take action in order to:

 A) Leave the Chinese market with their heads held high.

B) Regain the public’s trust after they were just hacked.

How do they do this? Today Google is the second largest search engine on the Chinese market, following only Baidu, a Chinese run company. This may sound profitable but it must be understood that Baidu controls around 60% of this market. Many speculate that Google has no hope to overcome its Chinese counterparts because Baidu is backed by local officials; a Chinese tendency to heavily support the home team in regards to business. Pulling out of China would allow Google to allocate that money elsewhere under the veil of censorship and turn it into a bigger profit without admitting defeat.

This issue pales in comparison to the consequences such a monumental hack brings to the table…….trust. Google provides a broad range of services: email, advertising, information storage, web and blog hosting and more. In most of their applications, passwords protecting private details are stored. Advertising on Google AdWords requires information that is connected to money (bank, credit card, paypal etc). People will now question how much they can trust Google; so what better way to regain the public’s trust than becoming a virtual Batman: preserving democracy and ensuring freedom for all.

Pulling the censorship goes one of two ways for Google. It can force China to lax its censorship laws, thus exposing the Chinese market in ways unimaginable. As successful as China’s economy is, it has always been incredibly censored and relatively closed off to the rest of the world. This penetration of the Chinese economy would be a win for Google financially and egotistically.

The second possibility is for China to stand ground, forcing Google to leave the Chinese market. Google Inc., for all intent and purpose, is the internet. The combination of its search engine and its many functions (and now exploring the mobile market), have made it a household name with an incredible reputation. They are hoping that pulling out would put a red flag on China (no pun intended) and hurt its reputation as being business-friendly. These actions would put China on the defense, which till now has partially worked. This news report shows the beginning of issues China is having, internally.

There is a downside: As previously noted, Google is not all that important in the Chinese market so this could blow up in their face. Only time will tell the impact this has on the intertwining worlds of reality and internet, for now I am just going to do a Google search and get the latest.