Now, Google has announced that they may change that policy. It seems that a large-scale attack on their servers – as well as those of other major businesses, reportedly including Adobe – originated in China, and appeared targeted on the Gmail accounts of Chinese human rights activists. In a concluding paragraph to a blink-and-you-miss-it blog post, Google says:

These attacks and the surveillance they have uncovered–combined with the attempts over the past year to further limit free speech on the web–have led us to conclude that we should review the feasibility of our business operations in China. We have decided we are no longer willing to continue censoring our results on Google.cn, and so over the next few weeks we will be discussing with the Chinese government the basis on which we could operate an unfiltered search engine within the law, if at all. We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.

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In the wake of the announcement, questions are being raised about whether the attacks originated inside the Chinese government, about the overall security of Google’s cloud-computing products, and about what this will mean for the over 300 million Internet users in China. Already, Secretary of State Clinton has asked for an explanation from the Chinese government, as “The ability to operate with confidence in cyber space is critical in a modern society and economy,” and Google has announced that Gmail will begin to automatically encrypt data for all users. Zhou Shuguang, a Chinese blogger, tells The Washington Post that “the withdrawal from China will wake up more Chinese and make more people discover that China lacks freedom on the Internet and the government has very strong censorship online. There are no benefits to people at all if Google continues to make concessions with Chinese authorities.” Certainly, Google withdrawal would be hugely unpopular among those who use the search engine.

Competing Chinese search engines, on the other hand, are downplaying Google’s announcement as a business decision made because of Google’s relatively small (20-30%) market share. Baidu, which controls roughly two-thirds of the Chinese search engine market, has already seen its shares rise 16% since the announcement, as it may soon become even more dominant.

There are obvious issues of freedom of speech, human rights, national policy, and industrial factors at play in this scenario, and it looks to be a high-profile developing story. Here, global networks are crashing up against national policies and cultural norms, and it’s unclear what (if any) outcome could satisfy the competing interests at play.