GOOGLE IN CHINA

August 2018

Negotiations

Professor: Juan Carlos Rivera Lopez

[pic 1]

OneMBA Class of 2019

Alejandro Reyes Ortiz – A00922584[pic 2]

Executive Summary

This case talks about the establishment of negotiations between two parties with quite different approaches regarding very different interests. It is set obvious the necessity to reach an agreement due the relevance of the issue for both the company and the technological/political situation of the country (China). Google which is the company trying to negotiate is trying to open doors for it operation inside the Chinese territory. Restrictions, censorship and banning due the government policies have led to a practical null access to Googles platform and search engines leaving them in disadvantage compared to their competitors, particularly talking about Baidu. In the other hand China has an interest of negotiating for gaining access for their body of professionals specially

1.- What were Google and the Government of China interests and positions? What were its alternatives and how good were they?

Google’s interest remains basically economic. Their experience and growth in many other markets took them to be the player number one in many nations including several in Asia. They have being trying to enter the market se they can have a proper market share that becomes profitable for them but the huge amount of regulations due the government policies leave a very narrow path of possibilities for their development. The exploration of having a .cn domain has being a very common subject for them but has not really given the solution they need, the possession of this domain would allow them  to avoid the firewall that slows down the operational functioning of their platform that made them lose customers during the past years. The company policy somehow crashes with the countries policies, while Google pursues the sharing of information to everyone, Chinese government remains isolating and filtering the information so it all goes through the control of the government.

Chinese government had a parallel interest. While being very determinant on not allowing the filtering of information and of course avoiding at all means the participation as investors inside the company for not allowing the gaining of power inside the control they already reached during the past few years controlling information and many of the technology companies they were reaching a point of interest that consisted in allowing access for their workers in the area and try to stop the leak of intellectual talent. For saying so, China wanted Google to operate inside the country but following all and each one of their conditions so no violations or loss of power, either initiative that might.

The midpoint between the two parties seemed again very narrow. In one hand if Google operates un China they will be violating or not accomplishing one of their main premises considering their values. The option on the inside consisted in enlarging the participation in Baidu so they could increase their share and finally the last resource for China was to avoid any negotiation with Google and focus only on the development of their inner technology plattforms.

2.- What were the two parties most concerned with, during the negotiations? How and why was this evident?

They have absolutely non-meeting reachable milestones. It is quite hard to negotiate and get something positive out of a negotiation as this, when the purpose has barely a common basis of interest. Google was pursuing an increase in profits and market share while remaining independent and loyal to the company’s values and on the other hand China was only worried for maintaining their censorship, privacy and filters policies besides finding a proper to maintain their talent. It seems at this point that two different session for negotiation must be established as they are evidently divergent issues that will end up in discomfort for both of the parts.

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