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Google Expects China License Renewal

By JESSICA E. VASCELLARO
Wall Street Journal
July 8, 2010


Google Chairman and CEO Eric Schmidt, right, speaks beside co-founders Sergey Brin, left and Larry Page at the Sun Valley Inn in Sun Valley, Idaho July 8, 2010
SUN VALLEY, Idaho-Google Inc. Chief Executive Eric Schmidt said Thursday that Google believes it will resolve its ongoing fight with the Chinese government over operating in the country and dismissed a range of probes facing the company over privacy and regulatory issues.

Addressing a topic that has been hanging over the company for months-the fate of its business in China, he said the company now expects to have its operating license from the Chinese government renewed, allowing it to continue to offer search services to Chinese users.

His comments, during an informal briefing at the Allen & Co., conference here, come as the Mountain View, Calif., company has been restructuring its Chinese business for many months after deciding to stop censoring its Chinese-language search services earlier this year.

After it stopped censoring, it began directing queries from mainland China to a version of its search service it doesn't censor hosted off the mainland. But after the Chinese government indicated it wouldn't renew its license if it continued that practice, Google stopped the automatic redirect, leading to the current standoff.

Joined by Google co-founders Larry Page and Sergey Brin, Mr. Schmidt also highlighted Google's improving relations with media companies and their executives attending this annual gathering of media and technology moguls.

"We have deals now with almost every person here," he said, saying content businesses-from movie studios to sports networks-now realize that Google can help them make meaningful money through its video site YouTube and other properties.

Responding to questions about several regulatory and privacy probes underway against the company in Europe, Mr. Schmidt said that the company is working to educate regulators about its business and its benefits for consumers. As for recent remarks from the French government calling Google a monopoly, Mr. Schmidt said Google "disagrees."

Messrs. Brin and Page joined Mr. Schmidt in discussing a range of competitors and product priorities, touting the progress of the Chrome Web browser and reiterating the first netbook computers running Google's Chrome operating system are expected around this fall.

Turning to its rivalry with Apple Inc., which Google competes against in everything from mobile phones to website browsers, Mr. Schmidt said there was room for at least two companies in these markets.

But Mr. Schmidt, who stepped down from the Apple board in 2009, said Google and Apple have very different views of the world, with Google being more amenable to developing products that work with a number of different technologies, including Adobe Systems Inc.'s Flash, which Apple has banned from its devices. "Apple's strategy is completely different from Google's," he said. "You have a real contest of strategies here."

Mr. Brin said the search company was planning to boost its social-networking offerings but declined to comment on whether Google was working on a rumored social-networking service called Google Me.

While playing up Google's cooperation with the media business, Mr. Schmidt did highlight one area where Google and other media companies don't yet see eye-to-eye: its recently announced Google TV service which allows users to watch cable and online programming through one interface. While Mr. Schmidt said companies at Sun Valley had told him they were interested in the idea, he felt they didn't quite understand the product.

"Most people here probably don't understand the full implications of a programmable television," he said.



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