I had been expecting Google to take its marbles and go home—abandoning China to Baidu and other local players. This expectation was, in part, due to the great analysis I read and commented on, in Tricia Wang's Cultural Bytes blog. So I was pleasantly surprised this week to learn that Google and the Chinese government had come to an accommodation that renewed Google's license in China and lets Google continue to serve Chinese customers, but still host their servers in Hong Kong as they’ve been doing since the beginning of the year.
Josh Noble at the Financial Times sheds more light on WHY the Chinese government renewed Google's license at the last minute, by quoting the Eurasia Group heavily: To paraphrase, the Chinese succumbed because Chinese scientists and geeks rely heavily on Google, and Chinese industry relies heavily on its scientists and geeks. Josh quotes the Eurasia Group:
"Google had won the loyalty of Chinese scientists and engineers. This powerful constituency sits at the nexus of every strand of China's industrial modernization effort. And its members often prefer using Google to its Chinese competitor, Baidu, the limited search capabilities of which would constrain access to international technical books, papers, data, and websites, and which cannot compete with Google's popular translator tool."