S15: Nailing Jelly

Business History of Modern China

October 17, 2025

Charlie Chaplin Google Doodle

Time: From PC to the Internet

China

  • 1960: First home-grown electronic digital general purpose computer, the Model 107, went live
  • 1994: Year One of the Chinese Internet: first web server, websites, and electronic bulletin board

Taiwan

  • 1976: Acer founded as distributor of electronic parts,
  • 1987: TSMC, the world’s first dedicated semiconductor foundry, founded

World

  • 1945: ENIAC, the first automatic, general-purpose computer
  • 1976: Steve Jobs and Steve Wozniak co-founded Apple
  • 1981: IBM released first PC “Acorn”
  • 1991: World Wide Web
  • 1998: Google founded

History of Chinese Computer

Evolution of Chinese language computing technology

  • English has 26 alphabets. How can Chinese — a language with tens of thousands of characters and no alphabet — be input on a computer?
  • Development of electronic Chinese input methods: software programs that enable Chinese characters to be produced using alphanumeric symbols.

Chinese Keyboards

Chinese typewriter

Early electronic Chinese keyboard

Bopomofo keyboard (Taiwanese standard)

Taiwan’s Silicon Shield

From its origin as an electronics contract manufacturer for the Silicon Valley in the late 1970s, Taiwan has grown to be a key player in the global information hardware industry.

Taiwan and Electronics Contract Manufacturing

  • 1970s: Taiwan’s electronics industry started when foreign companies outsourced assembly to Taiwan.
  • 1980s: Rising wages, property prices, and currency appreciation in Taiwan increased costs for businesses.
  • 1990s: Taiwan lifted investment bans on mainland China. Companies moved across the strait for cheap labor and resources.

China: Electronics

Connected successfully to the CEIC database

Shenzhen: Huaqiangbei Electronics Market

Bill Clinton on China

Discuss: Nailing Jelly

In 1998, US President Bill Clinton visited China and went to a private internet cafe in Shanghai to take a look at new developments in China. At that time, there were only 30 internet cafes in Shanghai, and the software was imported from the US, with no local internet technology companies.
  • Was Bill Clinton wrong? If so, why?
  • How did China change the Internet? How did the Internet change China?
  • From empowering citizenship to echo chamber: What’s the future of the web?

Puzzle: The US innovates, China replicates, Europe regulates?

Key Questions

Great Firewall of China
  • Google in China: Why did it go? Why did it leave?
  • What is the Great Fire Wall? How does censorship (not) work?
  • Did Chinese Internet boom in spite of censorship or because of it?

Google in China

Google China Website 2010
  • Founded in 1998 in Menlo Park, CA
  • Unofficial motto: “Don’t be evil”
  • 2000: partnership with Yahoo helped Google become the leading search engine.
  • 2006: Launched Chinese site Google.cn

Google’s First TV Ad

Google’s position in 2010

Globally:

  • Google’s peak worldwide market share for online search reached nearly 85% in early 2004.
  • By 2009, Google offered search options in more than 110 languages and had offices in dozens of countries.
  • Google’s IPO in August 2004 raised $1.6 billion.
  • By 2008, Google’s revenues reached $21.8 billion, mainly from AdWords and AdSense.
  • Google focused on mobile computing, introducing Android in 2005, and its first smartphone, Nexus One, in 2010.

In China:

  • Google launched Google.cn in 2006, with local workforce of 700 employees by 2009.
  • Revenue-sharing agreement with China Mobile starting in 2007.
  • Revenues in 2009 were approximately $300 million (1% of Google’s corporate revenue).
  • Google’s search market share in China was 31% in Q3 2009, compared to Baidu’s 64%.
  • Internet users in China: 105 million in 2005; 338 in 2009, with about 24% using Google.
  • China was the second-largest retail market globally.

Google China: Brushes with the Censor

What led to Google’s decision to leave?

Discuss: Google’s dilemma

Anybody who does business in China compromises some of their core values. The question that I struggle with is are we better off giving Chinese citizens a decent search engine, even if it is restricted and censored in some cases than a search engine that’s not very good? I don’t know the answer to that.

John Hennessy, Chinaman Alphabet Inc.

Should Google stay or leave China?

Discuss: Google’s dilemma

Google headquarter
  • Does it matter if Google self-censors or China does the censoring, if the result is the same?
  • Google gets asked to remove contents in many markets. What’s so different about China?

Eric Schmidt on China

Google in 2018: Project Dragonfly

People left bouquets of flowers on the Google logo outside the company’s China office in Beijing to mourn its closing in 2010. Li Xin/AFP/Getty Images
  • Since its exit from search engine market in 2010, Google had been rebuilding its presence in China.
  • In 2017, Google established the Google AI China Center in Shanghai, with an estimated 700 employees working on advertising and other development.
  • In 2018, it was reported that Google created Project Dragonfly, a search engine that would comply with Beijing’s censorship requirements.

Poll: Should Google build Project Dragonfly?

Discuss: Project Dragonfly

  • Should Google build Project Dragonfly?
  • Should a Google employee voice concerns about Dragonfly internally, go public, or resign in case of disagreement with the project?

Eric Schmitt: A Change of Mind?

Following the public row surrounding Project Dragonfly, 1,400 Google employees signed a letter of protest against it.

Mark Zuckerberg: “They will never let us in”

Zuckerberg in China

President Xi Jinping, center, meets Mark Zuckerberg, Facebook’s chief executive, as Lu Wei, China’s top Internet regulator looks on. Photo by Ted S. Warren

Mark Zuckerberg with Alibaba Founder, Ma Yun

Mark Zuckerberg in Beijing

Bing: The One That Stayed

Bill Gates with Xi Jinping

Results from a search for “Uyghurs” in Chinese on Microsoft Bing

Results from a search for “Uyghurs” on Microsoft Bing US

Discussion: Censored (2018)

Great Firewall of China
  • What is “porous censorship”?
  • How should we think about censorship in the Chinese context?
  • Explain the three Fs: fear, friction, flooding

Paradoxes of the Chinese Internet

Great Firewall of China
  • China is an authoritarian state exercising strict control and censorship.
  • At the same time, the country is a leader in digital technology, from 5G to AI to e-commerce.
  • Censorship in China is restrictive and repressive, but also porous and permissive at times.

Data Sovereignty Challenge

  • The WWW was supposed to eliminate physical boundaries and create a global public sphere.
  • Essential public infrastructures worldwide depend on digital systems controlled by a handful of American private corporations – a reliance now seen a pressing geopolitical risk.
  • Is the Internet splitting into multipolar hardware stacks and information zones?

Google: Don’t be evil… no more?

Google headquarter
  • Google’s initial motto was “don’t be evil”. It was downgraded to a “mantra” in 2009.
  • The motto was not included in Alphabet’s code of ethics when the parent company was created in 2015.
  • In February 2025, Google’s owner dropped the promise not to use AI for weapons.

The Race of Our Times