Google Takes the High Road

MOUNTAIN VIEW, Calif. ( TheStreet) -- The protest for change in China's Internet policies puts a polish on Google's ( GOOG) image.

Claiming its network in China was attacked -- and that the email accounts of two human rights advocates were hacked -- Google is reviewing whether to stay in the country.

Judging from the company's public comments, it's clear that Google wants to open up discussions and influence change in China's Internet controls. Until now, Google has tolerated the censorship and surveillance of network traffic that have been conditions of its participation in the rapid growth of China's Internet market.

But the latest violation, specifically the snooping upon individuals, has highlighted a much bigger problem, and Google wants the world to know about it.

"We have taken the unusual step of sharing information about these attacks with a broad audience not just because of the security and human rights implications of what we have unearthed, but also because this information goes to the heart of a much bigger global debate about freedom of speech," wrote Google's chief attorney Dave Drummond on his company's blog Tuesday.

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Other companies tend to tiptoe around China's big brother practices.

Tech shops like Cisco ( CSCO), Juniper ( JNPR) and Nortel sell networking equipment that allows phone companies and/or governments to play traffic cops. Without this so-called deep packet inspection gear, carriers couldn't easily identify the source, destination and type of traffic on the network. 'We just make the gear,' seems to be the companies' tagline.

Google's search rival Yahoo! ( YHOO) got a bit wrapped up in China's heavy machinery in 2005. Later, Yahoo! turned its China Net operations over to Alibaba and last year, after Yahoo! CEO Carol Bartz complained that the Yahoo! brand had suffered in China, sold its stake in Alibaba.com (though Yahoo! retained its investment in parent Alibaba Group).

But Google, one of the world's biggest Internet traffic sniffers, wants to draw a clear line on privacy and show exactly where it stands.

Collins Stewart analyst Sandeep Aggarwal says the core issue is trust. For Google, that's bigger than China.

" Google cannot afford its reputation to be tarnished by allowing anyone to tamper with users' personal information or privacy data," wrote Aggarwal in a note Wednesday. "The cyber attack in China can risk Google's global franchise and business model, which is built on trust."

Google's protest is an effort to show the world that some of China's Internet policies can be a force of evil. Google's motto suggests that the firm doesn't want to be a part of that.

As one analyst, who asked not to be named, said: "This is a brilliant move by Google to fortify its global brand."

-- Written by Scott Moritz in New York

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