Case

KEL242

CHRISTOPHER GROGAN AND JEANNE BRETT

Google and the Government of China:

A Case Study in Cross-Cultural Negotiations

The team of Google executives assigned to negotiate with Chinese government officials

began to arrive at San Francisco International Airport two hours before their scheduled departure.

The seasoned team had been briefed on Chinese culture throughout the past two weeks by a

special consultant retained for the negotiations. They had also been provided with an executive

summary of press coverage on China and China’s most recent policy announcements regarding

the Internet. The flight across the Pacific would give the executives valuable time to prepare for

the negotiations concerning the acquisition of a Chinese domain name for Google and to reflect

on just how far the company had come.

By the summer of 2005, Google had matured from a cutting-edge Silicon Valley start-up to

emerge as one of the world’s Internet titans. In only eight years the brainchild of two Stanford

University graduate students had transformed an industry and was generating impressive earnings

from advertising and the licensing of its search engine technology. Google’s publicly traded stock

had skyrocketed since it began trading a year before (Exhibit 1). The company was admired for

its audacious goals (nothing short of organizing and providing access to “the world’s

information”1), its corporate principles (famously and succinctly encapsulated in three words:

“Don’t be evil”2), and its healthy balance sheet. By combining a Microsoft-like aggressiveness,

an Apple-esque zest for innovation, and seemingly rigid adherence to utopian ideals, Google had

captivated its users, customers, and investors. The company’s flagship Web site, Google.com,

stood among the most visited sites on the Internet (Exhibit 2).

A company that sought to organize “the world’s information” would never be content with

limiting its presence to the U.S. market. As Internet usage...