Google's China problems keep getting worse. Google had decided to re-route its Chinese search engine through an uncensored Hong Kong server to evade China's army of censors but the problem hit this week when Chinese internet users were getting simple searches blocked with a "page unavailable" error message.
As the Financial Times reports, Google claims the blockages occured when it inserted new computer code into its system which included the letters "rfa". It says Chinese filters jacked up because they confused its search pages with Radio Free Asia, a site which is blocked by China. Then hours, later, Google came out and blamed it all on the Chinese firewall. Now the internet savvy types in China can get around the firewall by using proxy servers and virtual private networks but those outages are going to cost Google plenty in terms of lost advertisements.
What the incident shows is the continuing confusion over Google's relationship with the Chinese government. But what makes it worse are the reports that mobile operators and handset manufacturers are now turning their backs on Google after it re-routed its Chinese search engine traffic to its Hong Kong site. A lot of them would be state owned companies, so no surprises there, but some would be private too. It's bad news for Google because China boasts the world's biggest mobile market. There are more than 750 million subscribers and many of them access the web on their handsets.
But BusinessWeek says China is the least of Google's woes. It is losing market share to Facebook and BusinessWeek is comparing it to Microsoft. Ari Levy, Brian Womack and Joseph Galante from BusinessWeek write: "Google's ventures in mobile, video and display ads have failed to match the success of search, and regulators may thwart efforts to expand through acquisitions. As sales gains diminish, some investors are concerned that Google has begun to resemble Microsoft Corp., which generates billions of dollars in cash from its mature flagship business yet has struggled to conquer new markets."
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