It's more than two months since Google first threatened to lift the veil of censorship from its Chinese search engine after it came under attack from hackers. But after weeks of protracted negotiations with the government in Beijing, it now it appears that the internet's most powerful company is taking its first concrete steps to withdraw from China.
Just a few minutes ago, Google's Chinese search engine - Google.cn - started redirecting to the company's service Hong Kong, in what seems to be the first major signal of a pullout.
What does that mean? How does it affect the millions of Chinese citizens who use the web on a regular basis? What are people saying on all sides?
Those are the big questions in this developing story, and we'll be documenting what it means, how people are reacting - and whether the change is working - here.
7.24pm: The first indications that the change was happening came in reports overnight, and a statement from US state department official who suggested that Washington was "aware that there are strong indications of an announcement by Google this afternoon".
In fact, Google started making the changes a short while ago: now the company has now published a lengthy statement on the issue.
7.28pm: In Google's statement, the company said it is now sending Chinese users to the Hong Kong service - which, thanks to its unique cultural and political history - is not censored by the government for political content.
"Earlier today we stopped censoring our search services—Google Search, Google News, and Google Images—on Google.cn. Users visiting Google.cn are now being redirected to Google.com.hk, where we are offering uncensored search in simplified Chinese, specifically designed for users in mainland China and delivered via our servers in Hong Kong. Users in Hong Kong will continue to receive their existing uncensored, traditional Chinese service, also from Google.com.hk."
7.30pm: What does that actually mean for users in China? Well, for starters the Hong Kong service seems totally uncensored. I've just gone to google.com.hk and looked up 六四事件 - June 4th incident, as the Tiananmen Square massacre is referred to. The first result is this Wikipedia entry, which prominently features a picture of the famous "tank man" confronting a column of soldiers holding only a bag of shopping.
Not much in the way of punches being pulled there.
The question is how the Chinese government reacts. Will Chinese users outside Hong Kong be able to see these results?
7.39pm: Google's statement says it has "been hard" working out how to stop censoring search.
"We want as many people in the world as possible to have access to our services, including users in mainland China, yet the Chinese government has been crystal clear throughout our discussions that self-censorship is a non-negotiable legal requirement," it says.
It says the result is "entirely legal" and that company officials "very much hope that the Chinese government respects our decision".
It also points out that Google has no intention of dropping its research and development operations in China and will maintain a sales team in the country - though it admits that the size of that team depends on whether Chinese citizens can access google.com.hk.
"Finally, we would like to make clear that all these decisions have been driven and implemented by our executives in the United States, and that none of our employees in China can, or should, be held responsible for them. Despite all the uncertainty and difficulties they have faced since we made our announcement in January, they have continued to focus on serving our Chinese users and customers. We are immensely proud of them."
7.42pm: Google's move comes just hours after a group of angry Chinese citizens wrote an open letter addressed to the government and to Google asking them to reconcile their differences so that ordinary web users are not blocked from accessing useful online services.
"If Google.cn were to no longer exist, or if China were to further block other Google services, has the Chinese government considered how their blocking of foreign websites and censorship of domestic websites violates Chinese citizens' right to scientific, educational, environmental, clean energy and other information?" it says.
The letter also asks for greater transparency to help the public and businesses operating in China to understand the rules of censorship.
"We support necessary censorship of internet content and communications, whether it is on Google or any other foreign or domestic company," it said.
But, it adds, understanding exactly what it is that the government wants is the only sensible way to allow companies to comply.
A translated version of the letter is here.
7.48pm: As Caroline Davies reports, the change could affect up to 340m Chinese citizens, the world's largest single population of web users.
What impact will this have on Google's business? Unlike the rest of the world, where it is the dominant force in web search, the Californian company can only boast around a third of the Chinese market (it falls behind Baidu. My feeling is that we're going to see a lot of speculation as to whether this hinders Google's long-term success.
7.52pm: In the comments, user Shanghainese - presumably in Shanghai - says the Hong Kong Google site is blocked.
"Are you writing this from within China? I'm guessing not. I just tried the same search for the certain incident you mention on the hk site and got an error page. Google won't load at all for me now."
As pointed out, I am writing this from San Francisco (see my name at the top of the article) but our correspondent in Beijing is trying to find out what is and isn't filtered for her. The government's application of internet filtering is notoriously spotty, often left to local law enforcement agents so that blocks vary wildly from city to city.
8.04pm: I've just been talking with our Beijing office, who say that the veil of censorship has not disappeared - even though there is some access to the Hong Kong service.
Dan Chung, the Guardian photographer who works out of China, says that "some searches are blocked, as you would expect".
8.09pm: Reaction so far is a little muted - not least because it's still unclear what this move means - but the general consensus seems to be that Google is doing the right thing by following through on its threat.
In the comments, Madridophile says "it seems like this was absolutely the right thing to do, at least for now", while jhb15 captures quite a lot of public sentiment by saying that "I didn't think they were serious when it was in the news before".
Over on Twitter, it's much the same. "Good for them," says @RiskMgmt. "Dignity > profits". @Spencerstweets calls it "bold", but @JussiAhlroth is sceptical: "Don't be silly and think this is about ethics".
8.15pm: So how much is this move going to cost Google exactly? Nobody is sure,
According to Enders Analysis, Google.cn takes about 20% of the money from paid search advertising in China, which is a little bit lower than its market share. That might not seem like a vast amount, but when you're talking about a business as large as online advertising it's hardly pocket change.
"We estimate the revenue foregone over 2010-15 from closing Google.cn to be between $2-4bn," say Alice Enders and Ian Maude in a note that arrived by email.
While two billion dollars is nothing to be sneezed at, it's not a great deal of money for Google - which is making money hand over fist at the moment. Basically, it puts the five-year cost of dropping out of China somewhere between 8.5% and 17% of the money it made last year alone.
Perhaps the biggest cost could be in the lost opportunity, or the amount of money the company has sunk into establishing itself in China, says Enders.
8.25pm: Not in China but want to know what it's like to surf the web there? ChinaChannel, a plug-in for the Firefox web browser, lets you see.
On the other hand, Google also runs a status board for its various services - right now, it says that YouTube and Blogger are entirely blocked in China, while photo application Picasa and document-sharing service Google Docs have some problems.
8.40pm: Looks like those reports that the Chinese government is still blocking are accurate. Tania Branigan, our China correspondent in Beijing, has the following to say:
"Initial tests suggested that the Chinese government's own filtering system will stop mainland users from seeing the results of many sensitive searches in any case."
"And while google.cn now redirects visitors to google.com.hk, the Chinese government's own internet filtering system – "the Great Firewall" – prevented results from being returned when searches were conducted using sensitive words and phrases."
"The use of English and Chinese phrases such as "Tiananmen Square 1989" on google.com.hk resulted in the internet connection being reset.
8.46pm: Considered reactions are starting to come in.
The Center for Democracy and Technology, a non-profit group based in Washington that pushes for an open internet, said that Google was doing the right thing.
"CDT applauds Google for following through on its commitment to protect human rights and for its continued effort to enable China's people with unfiltered access to robust sources of information from all over the world," said Leslie Harris, the group's president and CEO.
"Whether the Chinese people will be able to take advantage of Google search now rests squarely with the Chinese government. If China allows access to unfiltered search, it will be a substantial win for global Internet freedom and for the Chinese people. If China blocks access, it will finally make clear to the Chinese people who is pulling the levers of censorship in the country."
8.52pm: Meanwhile, the Committee to Protect Journalists, which has lobbied for greater access to information in China, said it was a useful step for pushing Beijing in the right direction.
"We welcome this stand against censorship and hope that all Internet companies operating in China take a similar principled position," said CPJ Deputy Director Robert Mahoney.
"Google's decision to stop censoring search results will put Google on the wrong side of the Great Firewall. In the long run, however, we hope that it ramps up pressure on the Chinese government to allow its citizens to access the news and information they need to be informed and engaged citizens."
9.03pm: Some more sceptical messages coming through, as people wonder whether Google is trying to make the best situation out of a decision to pull out of a market that it was getting beaten in.
Well, here's some more on the business side of things: American financial analysts Jeffries & Company says that while the move may not cost it a huge amount in the first instance, it is almost certain to be a long-term negative:
"China today has the world's largest internet user base and one of the fastest-growing commerce markets. We believe that Google captures around 30% of China's traffic, making China the second-largest traffic-generating country for Google behind the US. Shutting down Google.cn, which we estimate generates 80% of the total China traffic, would be a strategic loss for the company."
Google's dominant position elsewhere in the world could buy it some breathing room, however:
"That said, exiting China would not be too damaging for Google, since the company is the market share leader in most non-domestic markets, where search usage and monetisation opportunities still abound."
9.15pm: More noises from the human rights community, this time from Index on Censorship, who asked Google's UK spokesman, Peter Barron, what was going on. His succinct response:
"It was clear that if we stopped censorship on Google.cn we wouldn't be operating within Chinese law — so we redirected to our Hong Kong servers which are not subject to Chinese censorship law."
As mentioned previously, that's very different from lifting the censorship altogether: Google is hoping that it can still serve from inside the Chinese state - albeit a corner that has previously had more lax censorship.
But to all intents and purposes, Beijing treats Hong Kong as a foreign outpost. And if a Chinese surfer tries to visit a controversial site in Britain or the US, they are blocked. Is it any different when the internet routes through Hong Kong?
9.34pm: I spoke briefly to somebody at Google who pointed out that the company runs a number of other web services in the country beyond search. Most of those are still in operation, despite this tangle with Beijing, and it's unclear how these are affected in the longer term.
Will the Chinese government block them, too?
9.46pm: Now Chinese officials are starting to react.
In an article from Xinhua, the state media service, a senior official lets rip, calling out Google for breaking the rules.
"Google has violated its written promise it made when entering the Chinese market by stopping filtering its searching service and blaming China in insinuation for alleged hacker attacks," Xinhua quotes the official as saying.
"This is totally wrong. We're uncompromisingly opposed to the politicization of commercial issues, and express our discontent and indignation to Google for its unreasonable accusations and conducts."
9.53pm:Here's a video report from our team in Beijing.
10.16pm: In our report from Tania in Beijing, she points out that the timing of the news seems timed to catch Chinese officials on the hop.
"The announcement came at 3am in China, meaning that there has been no response from officials as yet. Rebecca MacKinnon, visiting fellow at Princeton's Centre for Information Technology Policy, said: "It appears they are not doing anything that violates Chinese law – google.cn has ceased to exist. What they are doing in Hong Kong is in bounds of the law there.""
10.57pm: Sorry for the radio silence: I was writing a piece that we'll publish shortly about some of the internal conflict at Google ahead of this decision.
I'm not the only one who's been bashing his keyboard into oblivion: search blogger Danny Sullivan - one of the most respected names in the Google-watching business - has posted his thoughts on what this means.
He calls Google's shuffle an attempt to perform an "end run" on the Chinese government, and isn't sure that it would succeed.
"By moving to a Hong Kong domain — which is run under Hong Kong law — Google seems to believe that it can do an end-run around Chinese censorship requirements. Google has run a Chinese-aimed uncensored search service on that domain for several years without being blocked. Now it believes it can send everyone in China to that domain and meet Chinese law."
11.22pm: In a brief interview with the New York Times, Google co-founder Sergey Brin explains a little bit about the move.
Most intriguingly he says that the switch to Hong Kong - which I've been told was a compromise agreement negotiated between the two sides as a way to avoid the internet equivalent of nuclear warfare - was never actually given the go-ahead by Beijing.
The shift of its Chinese service to Hong Kong, Mr. Brin said, was not given a clear-cut stamp of approval by Beijing. But he said there was a "back and forth" with the Chinese government on what to do. "There was a sense that Hong Kong was the right step," Mr. Brin said."
11.30pm: It's still only 7.30am in Beijing, so Chinese web users are only just starting to wake up to the situation. The press there is unlikely to give Google much love, however: the past few days has seen the intensity of media attacks on the company increase.
This Reuters report details some of the allegations: that Google is a foreign company interfering in Chinese business, exporting its values unfairly and undermining the authority of the government. It's using political tricks, according to China Daily.
Whatever the case, it's as much a hot topic there as it is elsewhere and should generate plenty of interest as the day goes on. To keep you going in the meantime, here's a picture of a Google China security guard trying to hold a small gaggle of journalists at bay.
11.42pm: Time for some context. I'll start by showing you through a number of articles we've published - you can always find more at our Google+China page.
The first news came in the middle of January, when Google revealed it had been attacked. It soon turned out that plenty of other companies were victims too, and the hunt was on.
Early indications pointed to origins inside China, but the government said it had nothing to do with them.
Still, Hillary Clinton went on the warpath and lashed out at Chinese censorship online, a stance which officials said could damage diplomatic relations. Meanwhile, at the end of January, Bill Gates stirred the pot by suggesting that censorship efforts there were "very limited".
In February, Google linked up with the US National Security Agency, one of its old foes, to look further into the origins. But when the New York Times reported that the attacks could be traced to two Chinese schools, a source from one of those accused told us that it was unlikely.
Shortly afterwards, a report in the FT suggested the author of the code was working for the Chinese government - something that China, again, denied.
12.01am: For a sense of severe China's feelings towards Google are at the moment, it's worth taking a look at this piece from AFP, which points out the suggestion that Google is linked to the US intelligence services.
There is of course, a long history of mistrust between all sides here - going back centuries.
Indeed, writing on Salon, Andrew Leonard makes the point that moving to Hong Kong taps into a deep vein dislike that goes back to the opium wars:
"If Google wanted purposefully to adopt the mantle of the Britain's most notorious symbol of colonially arrogant capitalism, it could have done no better than to announce it was setting up shop in Hong Kong, there to broadcast its search results to all and sundry."
Meanwhile Tom Foremski at Silicon Valley Watch makes a similar point, before suggesting that "I like Google's stand against internet censorship but its dealings with China have become very messy".
12.10am: Rebecca Mackinnon sums up the situation as it stands - though, as she points out, it is only the insomniacs who were active during the night in China.
"The ball is now in the Chinese government's court in two ways," she says. "Whether they will block all of google.com.hk, which until now has not been blocked [and] whether they allow Google to retain its ad sales and R&D businesses in China".
Index on Censorship has also published an interview she conducted with Google's legal chief, David Drummond several months ago that is worth reading.
12.23am: So here's where things currently stand:
Google has redirected its google.cn search engine to the uncensored equivalent in Hong Kong. That site, which like all sites in Hong Kong is basically considered to be foreign, is subject to the usual filtering by the Great Firewall. This means that Chinese surfers may see controversial listings in their results - but they can't actually see the blocked pages themselves.
Google seems to suggest that it has discussed this solution with China, and hopes that it works - but the Chinese do not seem pleased with this answer. In the meantime, however, this effectively puts Google back to where it was in 2006, before it launched a censored version of the search index.
Except now the internet's most powerful company has upset Beijing, angered millions of people and taken four years to decide that censoring search contravenes its "don't be evil" policy.
I'm signing off for a little bit. We'll be back when there's more response to add.
5.10am: It's now early morning in Britain, lunchtime in China and the night is drawing to a close here in San Francisco - so just time for a few updates before I sign off.
First of all, here's my background piece on how this all blew up - looking at how Google got to this point, and how the internal politics at the company has left it on the brink with the Chinese government.
Important things to note:
There is a rift inside Google about how to deal with this issue that has been around for a long time, and Eric Schmidt - the chief executive - seems to have been on the losing side.
Google went ahead with this plan because it let them try and win without giving up on its ideals entirely. Except, as Sergey Brin has admitted, it did not know exactly how the Chinese government would respond.
And it turns out Beijing has strongly condemned this move. Ouch.
The ripples are starting to spread.
5.21am: What seems to be developing is a basic split between the story as it appears inside and outside Chinese borders. Inside China, the entire situation is being played down. Looking at the front page of the news sites, this story isn't even mentioned. But outside China, everyone is lining up to pat Google on the back.
That includes scads of human rights groups, such as Amnesty, whose director, Kate Allen, said: "Amnesty has consistently called on companies operating in China to stop collaborating with the Chinese authorities' censorship requirements, and to respect the right to freedom of expression for web users in China. It's very welcome news that Google appears to be moving back towards these principles. This now lays down the gauntlet to other internet companies operating in China."
5.32am: There's some interesting discussion going on in the comments: feel free to chip in if you've got something to add. So far reaction seems divided between those who think Google's doing the right thing (a majority) and those who think it's serving itself and is making a business decision.
One point I wanted to pick up, from user tteng that relates to the split between the company's founders and the chief executive that I mentioned earlier.
"Google's charter guarantees that its co-founders will never be removed of their positions by its board, thus Mr Brin can afford to make decision based on his belief, not necessarily on company's bottom line."
That's true. Ttseng goes on:
"As happened, Google has already been punished by the US stock-market after its January statement. In this instance, Google is making a moral choice at the expense of its stock holders."
That's not quite true. While Google did experience a drop in its share price on the news about China in January (and is down around 0.5% today), it is very hard to argue that it is being punished by the market. Here's a graph of Google's stock price over the past five years:
As you can see, it's taken a bit of a dip since it reached a high in October 2008. But it's recent travails have had a pretty minimal impact on the share price.
5.36am: As mentioned earlier, not every Google service has closed in mainland China. It's largely hitting web search and news (which covers the vast majority of Google's traffic). However, the block doesn't seem to cover everything: SF Weekly reports that uncensored results are available on Google's mobile site.
That's an indication that the Great Firewall isn't blanketing everything - though, of course, this is subject to change.
5.40am: The AFP is now reporting that Washington officials are "disappointed" that Google did not come to an agreement with China, in what sounds a little like a step back from the strong rhetoric of recent months.
"We are disappointed that Google and the Chinese government were unable to reach an agreement that would allow Google to continue operating its search services in China on its Google.cn website," the story quotes National Security Council spokesman Mike Hammer as saying.
Hammer added that relations between the two countries were "mature enough to sustain differences."
(compare that to the speech given by Hillary Clinton in January)
5.47am: China Daily - which is reporting Xinhua's line on the government's response - is also dredging up the details of a copyright spat with Chinese authors.
Meanwhile Li Ka-Shing, the Hong Kong billionaire who owns one of China's most important websites, Tom, has cancelled a deal for Google to supply web search, according to BusinessWeek. No surprise really - after all, if the government is blocking search results, Tom is only get a part of the service. But it's a blow nonetheless.
5.50am: I'm signing off now, but I'll give the last word to foreign relations expert Minxin Pei, who argues that Google has simply run into the enormous machinery of the Chinese state and had the misfortune to have "committed a double offense" along the way.
"Its search technology poses a clear and present threat to the party's regime security, while its capacity to dominate the Internet search business would deprive China of its own national champion, Baidu (which, although a private business, is easier to control)."
"Google's senior management may have learned a thing or two about dealing with a one-party regime through its unhappy foray into China. It's unclear, though, whether other Western firms have learned anything at all at Google's expense."
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