Google, Yahoo and MSN have all made allowances for working within China, while national search engines such as Baidu and SoHu operate under the same set of restrictions but are able to work within them, as they are Chinese national companies

It requires Internet companies operating in China to comply with the country's stringent censorship and security laws. As part of this process, Google has been tailoring part of its service to omit sources blocked by Chinese censors. For example, when a user in China searches Google's news service, sites related to Falun Gong and other groups banned by the government don't show up.

While other countries set some limits on what people can put on the Internet, China's constraints are perhaps the world's most extensive. It can be difficult to figure out just who enforces the rules and how. Numerous agencies -- from the National Administration for the Protection of State Secrets to the General Administration of Press and Publications -- have jurisdiction over the Internet. Foreign companies operating in China are obliged to comply with rules that block access to online content deemed politically unacceptable. Failure to heed the rules can cost a company its business licenses or trigger other penalties. Companies can also be required to turn over information on users suspected of having broken China's wide-ranging, but often vague, laws.

source:

1) http://lonestartimes.com/2005/12/19/

2) http://online.wsj.com/article/SB113468633674723824.html?mod=home_page_one_asia
As Google Pushes Into China,
It Faces Clashes With Censors
Executives Wrestled With Issue
As Others Took the Lead;
Now, It's Charging Ahead
What 'Don't Be Evil' Means

By JASON DEAN in Beijing and KEVIN J. DELANEY in San Francisco
Staff Reporters of THE WALL STREET JOURNAL

December 16, 2005

Google puts muzzle on itself in China
By Thomas Crampton International Herald Tribune

WEDNESDAY, JANUARY 25, 2006

DAVOS, Switzerland The company motto may be "Don't be evil," but Google, like other Western Internet companies, will adopt self-censorship to build its business in China, one of the world's largest potential Internet markets.

A growing number of visitors from China to the uncensored Web address www.google.com will now be redirected to the self-censored www.google.cn, Google executives said Tuesday. Citing concerns for the safety of the fewer than 50 Google employees based in China, company executives spoke on the condition of anonymity and insisted that all quotations for this article come from a written statement.

"While removing search results is inconsistent with Google's mission, providing no information (or a heavily degraded user experience that amounts to no information) is more inconsistent with our mission," Google said in a statement. "Google.cn will provide meaningful benefits to Chinese Internet users."

The news of Google's approach to China comes as the company battles a U.S. government effort to gain access to records of millions of search queries by its users. But fighting the government is not an option for businesses seeking entry into China. Self-censorship was a condition tied to Google's recently obtained license from the Ministry for Information Industries to run the .cn service, the Google executives said.

The .cn address will offer a stripped-down version of Google's offerings, including a self-censored version of the Google search engine. The self-censorship will be conducted on an ad hoc basis by Google in cooperation with the authorities. Since the government's censorship mechanism remains opaque and there is no list of what is banned, Google executives said they would feel their way forward to learn what would be censored.

The .cn address will not have any services that could have direct political implications or that would involve Google's holding personal information in China of potential interest to the Chinese authorities. For that reason, the company said, it would not offer e-mail service, discussion groups, video searches or blogging services.

"Clearly Google is searching for a way to do business in China that avoids them sending a someone to jail over an e-mail," said Rebecca Mackinnon, a research fellow at the Berkmann Center for Internet and Society, part of Harvard University, and former bureau chief in Beijing for CNN.

The Google strategy contrasts with the approach of Yahoo, which offers a full range of services, often from China-based servers. These services are censored according to Chinese regulations, and Yahoo faced severe criticism last year from human rights groups for helping the government trace a journalist, Shi Tao, who was jailed by the authorities. Yahoo said it had been legally compelled to provide the information.

"Google is clearly coming here to make money and they have made a commercial decision," said Duncan Clark, managing director in Beijing with BDA China, a consulting firm. "If you look at the muted consumer response against Yahoo after involvement with jailing a journalist, I don't think you'll see a mass rejection of Google."

Google said it had dealt with self-censorship before, notably in Germany over Nazi memorabilia and in France over racism-related issues.

In an approach similar to the one it takes in Germany and France, the company will notify users in China that their search has been censored. Any search results from which Web pages have been excluded will be accompanied by a notice telling the user that the list has been limited "in accordance with local laws, regulations and policies," the Google executives said.

"No other Chinese or foreign search engine, to my knowledge, indicates censorship," Mackinnon said. "This is important because many Chinese users are not aware they are missing the full Internet."

Google's goal in offering a censored version of its service was to clear the way for it to place servers behind China's official fire wall. This will make its search speed more competitive, relative to that of local competitors, the Google executives said. Google users in China are now directed to servers in the United States for a Chinese-language version of all the company's services. Passing the search through the Internet fire wall operated by the Chinese authorities slows response at best, and often blocks results entirely, they said.

The full Chinese-language version of Google with all services will remain available to users in China who manage to get through the government-operated fire wall. A link to the full service will be displayed on a tab in the .cn version, and users who have set a preference in their computers will always return to their preferred version.

While Google officials said their business in China is relatively small, the country's large and computer-savvy population offers huge potential.

Google would not disclose the size of its market share in China, but there have been private estimates that the search engine accounts for as much as one third of searches by Chinese Internet users, which numbered 111 million at the end of 2005, according to government data.

DAVOS, Switzerland The company motto may be "Don't be evil," but Google, like other Western Internet companies, will adopt self-censorship to build its business in China, one of the world's largest potential Internet markets.

A growing number of visitors from China to the uncensored Web address www.google.com are now redirected to the self-censored www.google.cn. The .cn address will offer a stripped-down version of Google's offerings, including a self-censored version of the Google search engine. The self-censorship will be conducted on an ad hoc basis by Google in cooperation with the authorities. Since the government's censorship mechanism remains opaque and there is no list of what is banned, Google executives said they would feel their way forward to learn what would be censored.

The .cn address will not have any services that could have direct political implications or that would involve Google's holding personal information in China of potential interest to the Chinese authorities. For that reason, the company said, it would not offer e-mail service, discussion groups, video searches or blogging services.

"Clearly Google is searching for a way to do business in China that avoids them sending a someone to jail over an e-mail," said Rebecca Mackinnon, a research fellow at the Berkmann Center for Internet and Society, part of Harvard University, and former bureau chief in Beijing for CNN.

The Google strategy contrasts with the approach of Yahoo, which offers a full range of services, often from China-based servers. These services are censored according to Chinese regulations, and Yahoo faced severe criticism last year from human rights groups for helping the government trace a journalist, Shi Tao, who was jailed by the authorities. Yahoo said it had been legally compelled to provide the information.

"Google is clearly coming here to make money and they have made a commercial decision," said Duncan Clark, managing director in Beijing with BDA China, a consulting firm. "If you look at the muted consumer response against Yahoo after involvement with jailing a journalist, I don't think you'll see a mass rejection of Google."

Google said it had dealt with self-censorship before, notably in Germany over Nazi memorabilia and in France over racism-related issues.

In an approach similar to the one it takes in Germany and France, the company will notify users in China that their search has been censored. Any search results from which Web pages have been excluded will be accompanied by a notice telling the user that the list has been limited "in accordance with local laws, regulations and policies," the Google executives said.

"No other Chinese or foreign search engine, to my knowledge, indicates censorship," Mackinnon said. "This is important because many Chinese users are not aware they are missing the full Internet."

Google's goal in offering a censored version of its service was to clear the way for it to place servers behind China's official fire wall. This will make its search speed more competitive, relative to that of local competitors, the Google executives said. Google users in China are now directed to servers in the United States for a Chinese-language version of all the company's services. Passing the search through the Internet fire wall operated by the Chinese authorities slows response at best, and often blocks results entirely, they said.

The full Chinese-language version of Google with all services will remain available to users in China who manage to get through the government-operated fire wall. A link to the full service will be displayed on a tab in the .cn version, and users who have set a preference in their computers will always return to their preferred version.

While Google officials said their business in China is relatively small, the country's large and computer-savvy population offers huge potential.

Google would not disclose the size of its market share in China, but there have been private estimates that the search engine accounts for as much as one third of searches by Chinese Internet users, which numbered 111 million at the end of 2005, according to government data.

DAVOS, Switzerland The company motto may be "Don't be evil," but Google, like other Western Internet companies, will adopt self-censorship to build its business in China, one of the world's largest potential Internet markets.

A growing number of visitors from China to the uncensored Web address www.google.com will now be redirected to the self-censored www.google.cn, Google executives said Tuesday. Citing concerns for the safety of the fewer than 50 Google employees based in China, company executives spoke on the condition of anonymity and insisted that all quotations for this article come from a written statement.

"While removing search results is inconsistent with Google's mission, providing no information (or a heavily degraded user experience that amounts to no information) is more inconsistent with our mission," Google said in a statement. "Google.cn will provide meaningful benefits to Chinese Internet users."

The news of Google's approach to China comes as the company battles a U.S. government effort to gain access to records of millions of search queries by its users. But fighting the government is not an option for businesses seeking entry into China. Self-censorship was a condition tied to Google's recently obtained license from the Ministry for Information Industries to run the .cn service, the Google executives said.

The .cn address offers a stripped-down version of Google's offerings, including a self-censored version of the Google search engine. The self-censorship is conducted on an ad hoc basis by Google in cooperation with the authorities.

source: http://www.iht.com/articles/2006/01/24/business/google.php

Google says that cooperating with Chinese government authorities allows it to provide some functionality to Chinese users, which they argue is better than providing no search service at all. According to the statement issued by Google, "While removing search results is inconsistent with Google's mission, providing no information (or a heavily degraded user experience that amounts to no information) is more inconsistent with our mission."

Google China does provide information to Chinese users, but with this censorship in place, the quality of the information is greatly at stake, coming dangerously close to the "heavily degraded user experience" that Google says it is trying to avoid. A Google China search reflects solely the viewpoint of the communist regime since only search results that survive the government-chosen blocks appear. While this limited search engine does provide some information, this bias prevents it from providing information that is accurate, which can essentially amount to no information at all.

source: http://silverchips.mbhs.edu/inside.php?sid=6263

MSN:

Microsoft Corp. formed a joint venture with a Chinese firm to launch MSN China and acquired assets of a local mobile software provider to offer MSN Mobile products and services in the country. Although MSN offerings such as the Hotmail e-mail service and MSN Messenger were already available to Chinese users, the joint venture allowed Microsoft to provide more local content. Microsoft has said that it is targeting professionals in the country, and that strategy could make sense since many Chinese use MSN to keep in touch with business contacts.

source: http://www.computerworld.com.my/ShowPage.aspx?pagetype=2&articleid=1117&pubid=3&issueid=46

Just like Google, MSN is also censoring prohibited content, such as by censoring prohibited language on its blogging portal in China.

Nice source for more reference:

http://goingglobal.corante.com/archives/china/

Yahoo:

Most industry experts believe that Yahoo's success in China stems mainly from
its localized strategy. In 2004, Yahoo acquired 3721.com, a successful local Internet business.
Wisely, Yahoo not only kept 3721.com's founder and CEO Hongwei Zhou, but also named him
GM of Yahoo China.

source: http://www.heidrick.com/NR/rdonlyres/7F30668A-9F8E-4302-B210-2BBBE4E4CF81/0/HS_ChinaPerspective_2006.pdf

Apart from complying with the censorship of prohibited content, Yahoo has tried to localized the design of its home page as per the taste of Chinese people.

For years Yahoo ! has allowed the Chinese version of its search engine to be censored. In 2002, Yahoo ! voluntarily signed the "Public Pledge on Self-Discipline for the China Internet Industry", agreeing to abide by PRC censorship regulations. Searches deemed sensitive by the Chinese authorities such as "Taiwan independence" in Chinese into the Yahoo ! China search engine, retrieve only a limited and approved set of results.

A US-based multinational, Yahoo ! Appears to be willing to go to any lengths to gain shares of the Chinese market and it is investing heavily in local companies. In 2003, it spent 120 million dollars to buy the search engine 3721.com. More recently Yahoo ! acquired a large stake in the Internet giant Alibaba in an operation that reportedly cost nearly a billion dollars.