Apr 03 2012

The Great Firewall of China Meets Web 2.0

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The following article was published in Business in Vancouver in June 2008.

The Great Firewall of China still looms large. But BC-based web technology experts have learned to operate in one of the world’s most cyber-policed countries – and they have high hopes for the future of Web 2.0 in what has become one of the most wired nations on the planet.

“Web 2.0 is exploding in China,” says Raincity Studios President Kris Krug. “The Chinese are totally wired, totally online, using web phones and all the mobile technology we use here. There’s a growing middle class wanting to use all these open source tools in part because that means they don’t have to worry about using proprietary software and pay licensing fees to Western companies.”

Krug has seen the dynamism up close, attending open source software and blogger symposiums in Beijing and Shanghai. Raincity Studios is entrenched now in the country, with a team of 13 employees in Shanghai, mostly open source online publishing software developers and their CEO, Robert Scales.

Meanwhile, Richmond-based IAS Energy’s Hong Kong venture, Video1314.com, is already reaping the benefit of China’s Web 2.0 frenzy. Video1314.com is a video-sharing site that combines YouTube-style functions with a virtual marketplace and educational gaming tools. The site has attracted millions of users since launching in early 2007.

IAS Energy Vice President of Internet Development Samuel Kam describes a virtual gold rush happening in China, with foreign web developers potentially having access to more than 200 million Internet users in China in 2009 — bigger even than the US market.

But the flip side for all these Chinese Web 2.0 enthusiasts is just how online communities and new media will be permitted to function when it comes to the Beijing Olympic Games. “Last time I was in Shanghai, the Chinese government announced they had just hired 100,000 new cyber police,” Krug says. “That’s on top of however many they had to begin with,” he adds.

Companies hosting and operating new media sites in China the same way they would in North America risk getting their site shut down completely, getting fined or having their license to operate in China revoked. Video1314.com has full-time moderators to ensure user content that violates the rules gets taken down within 24 hours, Kam says. Ignoring restrictions on free speech that would be beyond the pale in North America just doesn’t seem to be an option for companies wanting to do business in China.

Krug has also learned from experience how easy it can be to run up against the vigilant Chinese cyber-regulators. “We were running a Bar Camp (an informal Web 2.0 Drupal tutorial seminar) and our wiki was totally open. Anyone could register and write on it.

“Within a couple of days, we received a letter that we had to change our site in accordance with the rules in China. Users had to be pre-approved, content had to be moderated, and we had to make changes on the website. We scrambled to make the changes in 24 hours.”

For local Chinese website developers, citizen journalists and bloggers, the penalties for defying the censors can be severe. About 50 Internet users are detained in China, according to Reporters Without Borders. According to the same report, the Chinese government actively blocks websites deemed to be subversive, defamatory or divulging state secrets.

And incidents reported in the international media like the beating death of citizen journalist Wei Wenhua by 50 government officials for taking pictures on his mobile phone in January 2008 have shocked average Chinese and instilled fear in new media adopters.

Will Web 2.0 in China get a boost from citizen journalists covering the Beijing 2008 Olympics? Maurice Cardinal, the author of “Leverage Olympic Momentum” on doing business in an Olympic region, notes that both China’s and the International Olympic Committee’s own tough regulations make it a challenge.

While athletes have been given the right to blog, the IOC has a complex list of rules. Blogs should take the form of an online diary, they shouldn’t contain interviews with any other athletes, audio or video clips of Olympic events are strictly prohibited.

Meanwhile, host city’s mainstream media’s partnerships with the IOC entail legal obligations to avoid coverage of negative aspects of the Olympics on the host city, whether it’s Beijing or Vancouver, Cardinal says.

But the development of new media in Beijing and future Olympics host cities may force the IOC to change its business model, he adds. “Beijing 2008 will be the first time we’ve had enough of a critical mass to affect the IOC. The critical players here are the Olympic athletes. Some will be going strictly for the gold and won’t say anything, but some will feel an ethical responsibility (to use Web 2.0 tools to criticize human rights abuses and social problems associated with Olympic host countries).”

Since sponsors derive huge profits from association with the Olympic brand and the IOC survives solely based on its reputation, it is ultimately in their own interest to reverse its policy of limiting use of Web 2.0 tools, Cardinal notes. “Coca Cola has already taken a broadside hit regarding Beijing, and had to quickly defend their Olympic sponsorship affiliation.”

For now, Web 2.0 companies still have to tread a fine line in China to operate successfully in China while maintaining their own reputations.

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