Where does Google go now in China?

As several sources have pointed out, it's been 10 days since Google moved its search operations off the Chinese mainland and began offering unfiltered simplified Chinese language search from Hong Kong. While "sensitive" results from those searches are now filtered by China, Google's search engine remains unblocked, as do the Google services that were functional or partly functional prior to the company's move.

As we can see from Google's status page for mainland China, there was a blip on Tuesday in terms of availability that is "being investigated," but overall, services outside of search are just as crippled as ever:

Obviously, search remains the bread and butter of Google's business, so continuing to have access to search-related advertising in China is strategically important. However, as we watch Google diversify into a variety of areas ranging from mobile to broadband to home entertainment in the west, while businesses simultaneously flee partnerships with Google in China, one has to wonder if Google even has a future in the largest potential market in the world.

Really, where can they go now? How can they continue to grow a business in a market that represents about a seventh of the world population? Maybe a more interesting question, though, is why China didn't block Google's Hong Kong-based search entirely? Google certainly expected that this might be an outcome, but so far, nothing has changed, except that Google is no longer the one doing the censoring; they are leaving that to the Chinese government.

So the government gets to be the bad guy, Google comes out seeming like they did the right thing in the eyes of human rights watchers, and the status quo is, in fact, maintained. Sort of. Because as ZDNet's Ed Burnette pointed out, the story that the government is telling inside China is different than the story they are telling outside the country. While this isn't anything new for the totalitarian regime, in this case, Google stands to lose more of the advertisers that make up their "bread and butter" if China can tap into nationalistic sentiment with their spin. The example that Ed found related to a story published by the Xinhua News Agency, the Chinese version of which called Google a US political tool against China and made it clear that the Internet was not free or neutral. The English version contained no such text.

Again, this isn't surprising, but it is concerning in terms of Google's continued interests in China. I'm inclined to think that China will eventually be forced by the leveling effects of the Internet and grassroots, youth-driven populist efforts for social reforms to match their economic reforms. When and if that happens, bringing a more open Internet to the Chinese mainland, Google's window of opportunity will open again. For now, Google may just need to keep a foot in the door (as much on their terms as possible) and focus on growth in open markets.