Microsoft Gives in to China's Demands

Microsoft's Kowtow The software giant agrees to ban "democracy" and "freedom" in China.

"Where do you want to go today?"

That was Microsoft's slogan in the mid-1990s, one that evoked the unlimited possibilities inherent in the age of the Internet and the software revolution. The answer to that question today would be, "hopefully not where they discuss 'freedom,' 'democracy' and 'human rights,' " at least not if you expect to use Microsoft's new portal in China.

The software giant has just bowed to the Chinese government by banning these words. If you type them on Microsoft's new portal, a message appears telling you to try different ones. If this weren't insulting enough, the message actually says, according to news reports, "this item should not contain forbidden speech such as profanity. Please enter a different word for this item."

To be fair to Microsoft, it is not alone. Yahoo! and Google have also caved in to China. Google chose last year to omit sources the Chinese government does not like from its Google News China edition, saying that it didn't make sense to provide a link to sites that would probably be blank anyway. All of these Internet companies make the point that it is better to make a compromise, gain a foothold in China, and then offer China's masses the smorgasbord of information that is out there.

That view got backing from none other than Colin Powell, who happened to be in Hong Kong last week as this story was breaking. Microsoft figured it is "best for them and better for Chinese citizens to get

95% of the loaf," the former Secretary of State said at a conference when we asked him what he thought of an American company banning the word "freedom." While acknowledging that "Microsoft, and Google, and other information providers, have had to make a compromise that we wouldn't find acceptable in the United States," Mr. Powell said, "I think it's probably best for them to make that kind of compromise." Mr. Powell added that he thought the Chinese government was fighting a losing battle in thought control over the Internet, at least "if Chinese teenagers are like the teenagers in my family."

It is admittedly difficult for China's government to block Internet content from its estimated 87 million users, a number that is growing. But it is a lot easier if it has the cooperation of the industry. These corporations might also remember that Beijing needs their business. The Internet is where demand and supply meet these days, and China's leaders need economic growth to continue if they are not to face large-scale upheaval. Certainly the Microsofts and Googles might try to drive a harder bargain.

Copyright 2005 Dow Jones & Company, Inc.

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