November 2007


Overheard in the Office Now for some Friday fun. Do you work in a large office? Do you hate your job? Are your coworkers idiots?

Well, you're not alone. Take, for instance, the idiots overheard and quoted here on the surreptitiously funny blog, Overheard in the Office. Hours of aural voyeuristic fun! Enjoy!

New girl: Why is the door to the file room always locked?
Veteran: Because someone might steal something.
New girl: Who all has a key?
Veteran: Everybody.
. . .

Coworker packing her stuff as she quits: Jesus will pay my unemployment! I cannot work around you, the wicked!
. . .

Lady peon #1: Chipotle's burritos are, like, so good!
Lady peon #2: Yeah, I know. Carol*, have you ever had one?
Carol: Uh, I've never been out of the country…
. . .

Worker bee: I don't have his cell phone, but he's always at his desk… Except when he isn't.
. . .

Manager: What motivates you to do your best job possible?
Interviewee: Well, I don't do anything half-assed… Yeah, I like to put my whole ass into everything I do.
. . .

Office hottie #1: Just think of all the stuff we put in our mouths that we don't think about…
Office hottie #2: Ummm…
. . .

Boss to assistant: Well, I don't remember what all I had, um, asked you to do before I went on vacation, but did you, like, um, do it?
. . .

Manager: Did you see the game last night?
Coordinator: I was drunk. [Takes bite of Oreo.]
Manager: Huh?
Coordinator: Yeah, I'm drunk every day. S'matter of fact, I'm drunk right now!
. . .

Office girl #1: I don't like lettuce.
Office girl #2: You don't eat lettuce? Why'd you get a salad?
Office girl #1: Because I need to lose weight! I'm getting fat!
Office girl #2: What else is that in your salad?
Office girl #1: Chicken.
Office girl #2: Grilled or fried?
Office girl #1: Ummm… Fried…
Office girl #2: Uh-huh… Is that cheese I see in there?
Office girl #1: Yes!
Office girl #2: And are those Bacon Bits?
Office girl #1: Shut up! And no, it's real bacon!
Office girl #2: And you aren't gonna eat the lettuce?
Office girl #1: I will stab you with my fork! Go away!
. . .

Coworker #1: Congrats on your bush transplant!
Coworker #2: Thanks!
Coworker #3, overhearing: Uh, yeah, congrats on your bush transplant. I didn't know that was a procedure. Was it medically necessary?
Coworker #2 to #1: You should have said 'shrubbery' instead!
. . .

Female coworker, as another is delivered flowers: Every time I see the flower delivery guy I hope it's for me. I wish someone would send me something nice like that. Oh, well. I'll just take a piece of chocolate from the candy dish.
Male coworker: That's right, decrease your chances even further.
. . .

Sales rep #1: Here's that spreadsheet. I hid the columns you didn't need so it would fit on one page.
Sales rep #2: How did you do that? I have been cutting and pasting all this time!
Sales rep #1: Cutting and pasting?
Sales rep #2, pulling out three pieces of paper, cut and taped together to make one big spreadsheet: See? I cut and pasted!
. . .

Office mate on speakerphone: I need to send my printer back. It isn't working.
CSR for printer company: Okay, I can set up a return shipment and get you a label and address to send yours back. What is your e-mail address, sir? [He relates e-mail address.] Okay, when you get the link on the e-mail I just sent you, print the FedEx label and put it on the box to ship it.
Office mate: Um, well, my printer is broken, which is why I am sending it back…
CSR: I understand that, sir, so what I have done to speed up the process is send you a shipping label all prepared for you to ship the box out.
Office mate: How am I supposed to do that if my printer is broken?!
CSR: Well, you print it up and put it on the box.
Office mate: Okay, when we are done with this, I would like to order an instructional DVD on how to setup my DVD player.
CSR: I'm not following you, sir. I thought your problem was with your printer. We don't have DVD players.
Office mate: Dude, you're killing me! Can I speak to a supervisor, please?
. . .

Boss looking at her new laptop: There are too many keys.
. . .

Suit #1: Hey, Jeff*, has there ever been a Friday-the-13th on a Monday?
Suit #2: Uh…
Suit #1: Man, that would be the worst day ever.
. . .

Peon #1: Mmmm… I love these doughnuts. I could even eat them without the icing, the dough is so soft.
Peon #2: Like your flesh.
. . .

Suit #1: What was that?
Suit #2: What?
Suit #1: You just hid something when I came up.
Suit #2: It was my juice box, because it's… You know…
Suit #1: What? There's nothing wrong with drinking juice from a box. I love juice boxes.
Assistant, walking up: What are you guys talking about?
Both suits, in unison: Nothing.
. . .

Sales person: Hmmm… Are you doing the billing today since Sherry* is out?
Trainee: I'm going to try.
Sales person: Well, don't mess up my billing or I'll kick your ass.
Trainee: Promise?
Sales person: Oh, yes.
Trainee: My pain is your pleasure.
Sales person: You and I will get along fine.
. . .

Office girl on phone: I'm sorry, he's not in right now. Is there something I can do to you? Shit. I mean for you?
. . .

Male peon: So, where are you guys located, anyway?
Customer: We're in Guyana.
Male peon: Oh, over in Africa, eh?
Black coworker, yelling from four cubicles over to male peon: Stan*, you're an idiot!
. . .

Lady coworker #1 reading a website: Here it says, 'Sleep is the best cure for a headache.'
Lady coworker #2: My boyfriend always says sex is the best cure for a headache… He's lying to me!
. . .

Boss: Do you have five minutes so I can talk to you for a sec?
. . .

Six Degrees of Separation Graph There's been some chit-chat in the blogosphere about how online social networks have "built-in self-destructs." This was started when InformationWeek columnist Cory Doctorow wrote the article "How Your Creepy Ex-Co-Workers Will Kill Facebook". In it, he coined the term, boyd's Law (which is sort of a homage to danah boyd, a PhD student most known for her research on social networks):

Adding more users to a social network increases the probability that it will put you in an awkward social circumstance.

This is best explained by an example cited by Doctorow, and taken from one of danah's articles:

A young woman, an elementary school teacher, joins Friendster after some of her Burning Man buddies send her an invite. All is well until her students sign up and notice that all the friends in her profile are sunburnt, drug-addled techno-pagans whose own profiles are adorned with digital photos of their painted genitals flapping over the Playa.

What Doctorow doesn't cite (or maybe not realize?) is that there's an easy solution to this. Online social networks need to add the ability to create groups of friends, then allow each group different viewing permissions of the information in your profile. For example, your Coworkers Group sees only your work information and professional associations, your Family Group sees only your family photos and family-oriented blog entries, and your S&M Group sees only your naughty photos and dominatrix blog entries.

So why haven't online social networks implemented this yet? Technically, can be extremely complex. What they'd need to do is give every single piece of content multiple levels of permissions. That particular photo of your cats may allow "anyone" while that blog entry about your vacation allows both your "Coworkers" and "Family." It's not impossible to build, just highly complex. I know because I've worked with a team who tried to implement these features.

Some existing social networks already have the beginnings of friend groups and varying viewing permissions too. Let's take a look:

Social Network Friend Group Features
Facebook Can create a Limited Profile for friends who aren't really friends. Can limit pieces of profile info to be viewable only by certain networks. Can't limit views of photos.
MySpace Can limit blog posts to friends or a preferred list. Can't limit views of profile or photos.
Friendster Can password-protect your blog (for a fee). Can't limit views of profile or photos.
Bebo Can limit some portions of profile info to direct friends. Can't limit views of other some portions of profile, photos, and blog.
Yahoo! 360 Can limit pieces of profile info and entire blog to be viewable only by degrees of friends. Can't limit views of photos.
Orkut Can limit pieces of profile info to be viewable only by degrees of friends. Can create friend groups, but doesn't allow permissions to be set for them. Can't limit views of photos.

I've heard the idea of friend groups with varying levels of viewing permissions many, many times, since the early days of Friendster. So these social networks are no doubt aware of it. Perhaps it just hasn't ranked very high on their priority list yet, or perhaps they've been building it, but, because of its complexity, it's not ready for deployment yet. Either way, I wonder who's going to be the first to implement it; it sure is a highly-sought after feature!

National September 11 Memorial & Museum Here's a Thanksgiving idea. Sponsor a cobblestone in the National September 11 Memorial & Museum.

Slated to begin next year, the Memorial will consist of an eight-acre plaza with two enormous pools marking the original footprints of the World Trade Center. Massive 30-foot waterfalls will be cascading down their sides. The names of the 2,980 victims from both the September 11, 2001 attacks (in NYC, Washington DC, and Pennsylvania) and the February 26, 1993 bombing (in the WTC) will be inscribed along the edge of the pools. Filling the plaza will be nearly 300 oak trees to "create a contemplative space separate from the sights and sounds of the surrounding city," as the site states.

The Museum, whose primary space will be below ground, will contain interactive exhibits, personal effects, and educational programming to convey the stories of the victims and experiences of the survivors, responders, area residents, and witnesses.

You can sponsor a cobblestone for $100, a special opportunity cobblestone for $500, or a paver for $1,000. Each will include a membership card with your identifying number, plus acknowledgment on their site and in the Memorial kiosk. The special cobblestone and paver also receive acknowledgment during the official opening day ceremony. The $100 cobblestone and $1,000 paver will be placed in the Memorial Plaza while the special cobblestone will be located in the Memorial Glade, a spot set aside for gatherings and ceremonies.

It sounds like the Memorial & Museum is going to be a beautiful testament to the victims of these two tragedies. I look forward to seeing your cobblestone next to mine! And have a Happy Thanksgiving!

AdultFriendFinder This just in (um, no pun intended). Various, Inc., the parent company of AdultFriendFinder and its vast network of over 25 online personals-related sites, has just been purchased by the Penthouse Media Group.

Michael Arrington of TechCrunch reports that AdultFriendFinder is rumored to make over $300 million annually. Its acquisition price is supposedly anywhere from $500 million to $3 billion. His sources say it's closer to $500M though.

Since $500M for a $300M business is surprisingly low, I'm guessing the expenses of running a business like AdultFriendFinder are fairly high. Their net profits may be about half of that—say, $166M if you assume the $500M is 3x the profit? Or maybe even less?

AdultFriendFinder supposedly has one of the more profitable affiliate programs out there, which you could use to monetize your blog if personals ads compliment your content. Many a web entrepreneur has made a pretty dime off selling sex. And no, I haven't.

But that's not why I wrote about this. Nor did I really care to write about the acquisition (cool news as it is to Various, Inc). Really, I just saw an opportunity to use the title "Sex Sells." Hehehe…

Highland Homes Like to invest in real estate? Like environmentally-friendly technologies and products? Here's an interesting venture.

In last month's issue of Entrepreneur Magazine, they ran an article featuring young (read: under 40) millionaire entrepreneurs. Along with an impressive cast, one of the duos profiled is Bob Shallenberger & John Cavanagh, founders of Highland Homes.

Bob , 37, and John, 38, are fraternity brothers from St. Louis University who both had real estate development experience before banding together in 2003 to create the St. Louis-based "homebuilder with innovative designs, green developments and urban lifestyle," as they state on their website.

They use green housing methods such as "sustainably grown wood, rooftop decks, underground parking, lots of parklike green space and high-efficiency heating and cooling systems." Such techniques offer them a competitive advantage as well.

Says Cavanagh about green building, "It's difficult and it's expensive to learn. It's challenging, and there's some risk in it. We see it as a big growth segment of the market." Their next move? "Being recognized as the top green residential builder in the country is the goal for us," he says.

That could possibly happen, if they play their cards right. I certainly agree that green buildings (both residential and commercial) will become a huge market in the future. With the way the environment is going, I don't think we have much choice.

Highland Homes doesn't just aim for environmentally-conscious customers though. They also cater to the luxury market. "Each new home comes with a plasma TV and the option of special packages like 'Elvis Live,' which includes a stereo, karaoke machine, CD player and iPod Nano." Another one of their current options, the Super Bowl Shuffle, contains a 50" plasma TV, Sony Surround Sound, 2 front & 2 rear speakers, center channel & subwoofer, DVD/CD player, a Sony Playstation 3, and Madden NFL 2007.

Not bad. And even better, especially for California Bay Area real estate investors, are some of the prices:

Kilmore Condominiums near St. Louis University (all 2bd, 2ba, 1500 sq ft):

  • 7011 Dartmouth Ave 1FL - $249,900
  • 7011 Dartmouth Ave 2FL - $259,900

6416 Cates Condominiums near St. Louis University (all 2bd, 2ba, 2000 sq ft):

  • 6416 Cates Ave. 1FL - $314,900
  • 6416 Cates Ave. 2FL - $339,900
  • 6416 Cates Ave. 3FL - $359,900
  • 6416 Cates Ave. 4FL - $379,900

Donegal Condominium near St. Louis University (3bd, 2ba, 2000 sq ft):

  • 6404 Cates Ave. 2E - $319,900

Highland Walk Townhomes at The Hill in St Louis (3bd, 2.5ba, 2050 sq ft):

  • 5717 Arsenal St. - $299,900
  • 5719 Arsenal St. - $299,900
  • 5723 Arsenal St. - $299,900

To be fair, I'm not a real estate investor. I just happened to read about these guys and thought it was an interesting opportunity for someone. The prices are lower than the $700k - $1.5M I see in the Bay Area, though I know that doesn't mean Highland Homes' prices are a bargain it in St. Louis.

(Also, I have no affiliation with these guys, nor am I getting any money for this. I just thought it was a cool idea. Plus, I like hearing about green businesses.)

There'd be lots of factors to consider if you wanted to buy or invest a green home with these guys. Are their methods sound? Will they actually stand the test of time? Presumably, they will, since the guys are living in homes they've built. How are the neighborhoods there? Being next to a university means lots of possible renters, but is the rental market healthy? How about the country-wide real estate downturn? Will the rising costs of housing materials hurt them? Could their prices drop as sub-prime fears depress the market?

Hmm. Lots to consider. And if you're a serious real estate investor, I'm sure you have many more important questions. But hey, if this is a sound investment, and you want to invest in green AND real estate, here's a chance to combine the two!

Flag of China It's not easy being the first into a new market. Especially a market as vast and complex as China.

In Their Shoes

Let's say that you are the founder of an Internet search engine, called, um, Yahooglesoft. As a publically-traded company in a growth industry, you know that the greatest growth opportunities exist globally. So you enter China and slowly navigate its unfamiliar laws. To make things easier, you decide to open an office in Beijing. What better way to learn about this new market than to have a satellite office, right?

However, this new market has restrictions. In order to do business here, you have to comply with their regulations on information censorship. In their eyes, this is everyday life and most of its citizens don't see it as an evil. These regulations also block harmful sites such as child pornography, so they accept it.

Since information censorship runs counter to your values, this makes you uncomfortable. But several factors motivate you to adopt these regulations: the market alternatives are weak and your offering will benefit many new users, to satisfy your shareholders you need to continue growing the company, and a domestic competitor will surely enter this market if you don't. So you strive forward, ahead of your competitors.

You've also censored your search results before, in France, Germany, and your own home country the United States of America. There's already a precedent of removing certain search results based on the laws of that particular nation. China just has stricter regulations.

Since the Internet basically operates across a network of wires, the further a signal needs to traverse the wires, the longer a user has to wait for a web page. To solve this, you locate some of your web servers into China, to be closer to your Chinese users. This move puts that data under the legal jurisdiction of China, however. But it vastly improves the user experience, your product, and the enjoyment of your users.

Every so often, the local police ask you to release information about private citizens. Refusing them means blocking a police investigation and possible jail time. Not wanting jail, your employees turn over this information each time. In most cases, such investigations are to trace murderers, thieves, and other criminals.

But in one case, the information is used to incarcerate a journalist. As the founder of Yahooglesoft, you don't hear about this until it's made the headlines. You're aghast. You condemn the actions of China, yet you know your employees simply did what they were supposed to, what anyone would have done under those circumstances. There was no way they could have known about the consequences of their actions.

So if you put yourself in these shoes, and without the ability to tell the future, what would you have done in this situation?

Yahoo! and the Case of Shi Tao

Shi Tao Yahoo! (YHOO) was the first US-based Internet search engine to enter China. In 1999 it opened up a Beijing office and launched its Chinese-language search engine. Microsoft (MSFT) and Google (GOOG) entered the market later and enjoyed a second-mover advantage by being able to learn from Yahoo!'s actions.

In 2004, Chinese authorities discovered that a private citizen had sent an email containing what it deemed as "top state secrets" to an overseas organization using Yahoo!'s Chinese email service, according to EastSouthWestNorth's article "The Case for Shi Tao". The authorities approached the Yahoo! Hong Kong office with a judicial warrant to obtain the sender's IP information. The warrant didn't say why this information was needed, and "it is reportedly customary for e-mail service and Internet access providers to transmit information to the police about their clients when shown a court order," according to Reporters Without Borders (RSF)'s article "Information supplied by Yahoo! helped journalist Shi Tao get 10 years in prison".

In the comprehensive article "How Multinational Internet Companies assist Government Censorship in China" by Human Rights Watch, Michael Callahan, Yahoo!'s General Counsel, is quoted as saying, "When we receive a demand from law enforcement authorized under the law of the country in which we operate, we must comply." Not doing so means legal action against the company and its employees. Callahan continued: "Law enforcement agencies in China, the United States, and elsewhere typically do not explain to information technology companies or other businesses why they demand specific information regarding certain individuals."

It turned out that the data the authorities needed wasn't located in Hong Kong—it was located on servers in mainland China. Independent research from RSF confirmed this as well. So the employees of Yahoo! China did what any law-abiding citizen would do when presented with an ominous judicial warrant; they did as the warrant requested.

This led to the arrest of Shi Tao in 2004, a journalist, writer and poet. According to Wikipedia, "the Chinese authorities confiscated his computer and documents without showing any proper permit or document, and warned his family members not to talk about it with others." He was sentenced to ten years in prison.

This past Wednesday, Yahoo! co-founder Jerry Yang and Callahan testified in a hearing called by Representative Tom Lantos, chairman of the House Foreign Affairs Committee. The purpose was to determine if Callahan intentionally gave misleading testimony in February 2006 on this case. "While technologically and financially you are giants, morally you are pygmies," Lantos chided. RSF also condemned Yahoo!: "We already knew that Yahoo! collaborates enthusiastically with the Chinese regime in questions of censorship, and now we know it is a Chinese police informant as well." Even Zhao Jing (also known as "Michael Anti"), a Chinese journalist whose blog was removed from MSN Spaces by Microsoft at the request of Chinese authorities, had these scathing words: "Yahoo is a sellout. Chinese people hate Yahoo."

Yahoo! has also been implicated in the jailings of three other Chinese journalists: Lijun Jiang in 2002 (four-year imprisonment), Wang Xiaoning in 2002 (ten-year imprisonment), and Li Zhi in 2003 (eight-year imprisonment), all of whom used Yahoo!'s Chinese services.

Reaction from Chinese Bloggers

Map of China Words like "repressive regime" and "totalitarian" are used often in the Western press to describe China. Especially when it comes to censorship. But there are two sides to every story. It's easier to criticize and assign your own values to another society than it is to try and understand them.

From Zhao Jing (Michael Anti)

In a statement on his web site (and translated into English), Zhao writes:

When foreigners repeatedly use "totalitarian" to describe China, this is a deep shame for me as a Chinese person. This shame cannot ever be forgotten.

These kind of sentiments cannot be understood by foreigners. When the US Congress holds a hearing about Internet freedom in China, this is an American affair. When the US Congress proposes Internet freedom of information legislation, this is truly treating the freedom of the Chinese netizens as maids that they can dress up as they see fit.

From Angry Chinese Blogger

An article on by Angry Chinese Blogger entitled "Truth, Justice - or a near sighted attack on the Chinese way" also adds (emphasis his):

Critics have noted that, while the US administration, the private sector, and the NGO sector, will be well represented at the committee hearing, there will be no panel for representatives of the Chinese government. Leading some observers to accuse the committee of 'judging a foreign state using domestic standards' and of 'acknowledging only to two sides of a three sided confrontation'.

In a previous article, "Aiding the enemy: Congress's New Dilema", he pointed out the hypocrisy of China's critics. One of the loudest is RSF, a France-based organization that "fights against censorship and laws that undermine press freedom." Ironically, the French government once mandated Yahoo! France to remove all neo-Nazi memorabilia from its auctions. Angry Chinese Blogger writes:

While, under French law, the sale of items, promotion of ideologies, or denial of war crimes, relating to the the Nazi, is forbidden, all of these activities are protected as basic human rights under the US constitution; which guarantees freedom of expression and association, even in the case of revisionism and hate speeches.

As such, the removal of Nazi item from Yahoo's French website, under local law, could be constituted as illegal censorship under any new US laws governing complicity in overseas censorship.

RSF also publishes a Worldwide Press Freedom Index that rates every country in the world. Iceland is ranked #1, while France is #31. The US is further down the list at #48, below Nicaragua, Israel, and South Africa. China is #163.

Angry Chinese Blogger also wonders about the good-hearted intentions of the US government. In 2002, Lantos and Congressman Chris Cox proposed the creation of an "Office of Global Internet Freedom", which later materialized as the Global Internet Freedom Task Force (GIFT).

Despite the apparent benevolent intentions of the proposed body and bill, critics have however questioned whether they would really be a force for the preservation and promotion of global internet freedoms, or if they would merely be another avenue for the furtherance of US ideologies. With critics asking whether such an office would, for example, fight with equal vigor to protect websites promoting socialism in South America, as it would sites promoting US style democracy in China.

From EastSouthWestNorth

In EastSouthWestNorth's article "Yahoo! and the case of Shi Tao", the author examines the need for censorship.

Yes, there is true outrage about suppression of freedom of speech. But the answer is not to say that no censorship whatsoever shall be allowed at all. There are in fact legitimate reasons for some things to be censored (for example, child pornography is universally abhorred).

He further explains the need for some Internet censorship in the article "Hinano Mizuki: The Case for Internet Censoring in China", which argues that pornography should be censored, not just from children, but from everyone. In Western societies, nudity is generally more acceptable. Not so in many Eastern cultures. In Angry Chinese Blogger's About Me page, he writes: "I have a number of pet hates, including commercialism, cultural imperialism, and the insidious way that loose western values appear to have crept into Asian society."

EastSouthWestNorth also posted a brief in response to a number of articles from RConversation, the blog of Rebecca MacKinnon, an American journalist and assistant professor in Hong Kong. One in particular, "China censorship: Microsoft's defence", motivated EastSouthWestNorth to write:

You can condemn these companies for all you want, but in the end there has to be a practical and workable solution for them. Rejecting every single Chinese government warrant is NOT the answer, because you are in fact aiding and abetting real criminals most of the time. I personally do not see how this can be done. The change will eventually have to come from inside China about the law.

From Danwei

Dror Poleg of Danwei, a marketing manager for an international investment company in China, argues for a more free-market approach to changing China's Internet censorhip regulations in the article, "China and the Internet: It's access, stupid."

The web, with or without Tibetan rebels or the BBC, is the main driver of change in China. Concerns should focus on the fact that currently only 110 million people in China have Internet access. This comprises the world's second largest online market, but counts only for 10% of China's population.

US lawmakers should keep that in mind when approaching China. It is necessary to set ground rules for U.S. companies operating abroad, but as far as China is concerned, the imperative should be to allow access to as many people as possible. After that, when 400 million Chinese citizens are online, leave it to the market to bring down the walls.

From the New York Times

In the thorough New York Times article "Google's China Problem (and China's Google Problem)", author Clive Thompson writes about a discussion he had with Kai-Fu Lee, who founded the Microsoft Research division in Asia in 1998 and Google China in 2005.

But as Lee and I talked about how the Internet was transforming China, he offered one opinion that seemed telling: the Chinese students he meets and employs, Lee said, do not hunger for democracy. "People are actually quite free to talk about the subject," he added, meaning democracy and human rights in China. "I don't think they care that much. I think people would say: 'Hey, U.S. democracy, that's a good form of government. Chinese government, good and stable, that's a good form of government. Whatever, as long as I get to go to my favorite Web site, see my friends, live happily.'"

He also reports that the Chinese government does not hide its censorship regulations. It's well-known throughout the country that information is censored. In one example, a group of Harvard researchers presented a study on the Chinese Internet to a Chinese professor. The professor related the following story: "I talked to them and asked, 'What were your results?' They said, 'We think the Chinese government tries to control the Internet.' I just laughed. I said, 'We know that!'" Another professor added, "Chinese people have a 5,000-year view of history. You ban a Web site, and they're like: 'Oh, give it time. It'll come back.'"

The Western press often misunderstands what exactly is censored. Zhao, who has no reason to defend the Chinese government after they removed his blog, told Thompson: "If you talk every day online and criticize the government, they don't care, because it's just talk. But if you organize — even if it's just three or four people — that's what they crack down on. It's not speech; it's organizing."

If you look at China's past and history of media censorship, the Internet has already made radical changes to the Chinese culture, as Zhao tells him:

Before, he said, the party controlled every single piece of media, but then Chinese began logging onto discussion boards and setting up blogs, and it was as if a bell jar had lifted. Even if you were still too cautious to talk about politics, the mere idea that you could publicly state your opinion about anything — the weather, the local sports scene — felt like a bit of a revolution.

There is also no master blacklist of sites and words. Companies must interpret the vague regulations themselves. This confusion has lead to rampant self-censorship by Chinese ISPs to a degree probably stricter than the government intended. Thompson asked Xin Ye, founder of Sohu.com if dealing with these vague regulations was difficult. "I'll tell you this, it's not more hard than dealing with Sarbanes and Oxley," he answered. "I don't want to call it censorship. It's like in every country: they have a bias. There are taboos you can't talk about in the U.S., and everyone knows it."

The Competition Angle

Chinese Internet Companies As US companies face criticism and possible legal repercussions back home, Chinese competitors continue forward.

Chinese companies already have a home-field advantage of innately understanding the market. For example, according to Thompson in his NYT article, Chinese businesspeople "rarely rely on e-mail, because they find the idea of leaving messages to be socially awkward. They prefer live exchanges, which means they gravitate to mobile phones and short text messages instead." Local competitors were able to build products catering to this behavior before their US counterparts could.

As Yahoo found, these cultural nuances made the sites run by American companies feel simply foreign to Chinese users — and drove them instead to local portals designed by Chinese entrepreneurs. These sites, including Sina.com and Sohu.com, had less useful search engines, but they were full of links to chat rooms and government-approved Chinese-language news sites.

Some of the major Chinese Internet companies are:

Wall Street Journal's article "Yahoo's Lashing Highlights Risks Of China Market" notes that "while Yahoo and rivals like Google tried to comply with China's local laws, [doing so] ultimately backfired on them domestically."

"To be doing business in China, or anywhere else in the world, we have to comply with local law," Yang is quoted as saying in the Washington Post article "Yahoo Says It Gave China Internet Data". "I do not like the outcome of what happens with these things, but we have to follow the law." But what if by following one country's laws, you break your own country's laws?

(Ironically, the US government itself has been accused of censorship when it filed a court order urging Google to remove the anti-Scientology organization Operation Clambake from its search results.)

Radio Free Asia points out this apparent catch-22 in "Rights Group Slams Google, Yahoo! Self-Censorship In China":

Sources in Washington doubted whether any formal sanctions could be put in place to prevent companies from limiting freedom of expression in order to maximize profits, without risking charges of censorship themselves.

"The kind of regulation that would allow you to come after these guys for what they're doing could also be used to silence them, could be used to impinge on their freedom of expression," a lawyer with a Congressionally mandated organization told RFA.

This is what Angry Chinese Blogger calls an "Economic Paradox" (emphasis his):

In addition to moral issues, Congress also faces a number of stark concerns from the business community. With US companies stating bluntly that, if they refuse to comply with Chinese demands, and the requirement that all web services must be hardwired for censorship, China will simply switch to other foreign companies that are more willing to please.

Warning that, In effect, any legislation to enforce domestic constitutional standards on companies working in China could 'hand American contracts, and American jobs, to oversea competitors who are not 'burdened' by such regulations'.

He offers this quote from Sonia Arrison, the Director of Technology Studies of the Pacific Research Institute, a free-market think tank in San Francisco, CA: "If Yahoo [doesn't do] business in China, someone else will."

On top of the Chinese companies' home-field advantage, government regulations could add a significant hinderance to the success of US companies in China. "Some observers have cautioned Congress not to rush into the matter, and to be wary of producing 'knee jerk' legislation that could be counter productive, or even dangerous," adds Angry Chinese Blogger.

Which businesses could be effected? There a fair number of US companies that have been implicated in aiding the Chinese government in Internet censorship, including:

Lessons for Businesses Going Global

Hong Kong Buildings

Please don't get me wrong. I don't mean to make light of the deplorable imprisonment of Shi Tao or his colleagues. While I understand that the Chinese government is trying to use Internet censorship as a tool to prevent what it feels is morally reprehensible content, it's my cultural bias to believe it is abusing its authority by censoring politically different viewpoints as well.

Also, consider this sociological point of view: every time you preventing a group of people from seeing something, you'll make a few in that group want to see it even more. It's like putting a "Do not push" sign over a button and watching everyone push it. China's Internet censorship plan may actually strengthen its opposition more than it is protecting itself.

It is easy to criticize Yahoo!'s actions in hindsight, especially with a US perspective and value system. But this isn't a black-and-white case. The question shouldn't be, "Is Yahoo! good or evil?" It should be, "What can we learn from this situation?" Here's my take from the business perspective.

  • Sometimes Being Second is Better

    In the early days of Internet businesses, there was (and sometimes still is) a strong belief around the value of the first-mover advantage. While there certainly are benefits to being first, there is also a high level of risk for first-movers in uncertain markets. Countries whose cultural thinking may be very different or contain complex & vague regulations, like China, are a good example. In such markets, there can be an advantage in letting the someone else take all the punches. Microsoft and Google both learned from Yahoo!'s actions and have not set up servers that contain personally-identifiable information within China, for instance.

  • Be Prepared for Worst-Case Scenarios

    As Andrew Grove says, "Only the paranoid survive." While it's highly unlikely for Yahoo! to have forseen the consequences of locating their servers in China, a paranoid audit of China's regulations may have netted this worst-case scenario. This doesn't mean stalling out and taking no action; your business can't grow if you don't act. It means being prepared for & able to manage the potential risks of worst-case scenarios with any number of safeguards, including and perhaps especially legal safeguards.

    Human Rights Watch also adds this best practice:

    Human Rights Watch believes that it is likely impossible for an Internet company to avoid intentionally, negligently, or unknowingly participating in political repression when its user data is housed on computer servers physically located within the legal jurisdiction of the People's Republic of China. Thus the first step towards human rights-compliant corporate conduct in China is to store user data outside of the PRC (or for that matter, outside any country with a clear and well-documented track record of prosecuting internationally protected speech as a criminal act).

  • Understand Your Customer

    This concept is as old as apple pie, and just as good. When dealing with a foreign culture, it's extremely important to understand the mentality, traditions, mannerisms, behaviors, and values of the people. This can be done with research reports, hiring international consultants, or working with a partner in the target country. According to Thompson in his NYT article, Baidu.com "invented a tool that allows people to create instant discussion groups based on popular search queries," which capitalized on their users' preference for online chatting, because it understood their users better than their US competitors.

  • Understand Your Government's Role

    This one's a bit controversial and I am still debating it. Not everyone agrees that governments should get involved with business affairs (nor to its level of involvement). However, in the global marketplace, many governments are involved. Every government, to some extent, sets up trade barriers to protect local businesses, while hopefully not stifling foreign investments. In some cases, without your government's support, it can be difficult or impossible to enter a foreign market. But how do you get your government's support? Throw money at them? I'm not sure that's in the best interest of the people, though it's certainly what many companies do.

What other business lessons can be learned here?

Alec Baldwin in Glengarry Glen Ross

We're adding a little something to this month's sales contest. As you all know, first prize is a Cadillac Eldorado. Anybody want to see second prize? Second prize is a set of steak knives. Third prize is you're fired.
- Blake

ABC: Always Be Closing. No, wait, wrong acronym. I meant: Adversity Builds Character.

Human beings are remarkably adaptable. We can adapt to some very adverse conditions, oftentimes growing stronger as a result. Take children as an example. Children who grow up in somewhat dirty environments tend to have stronger immune systems, while those in pristine environments find themselves getting sick easily as adults, as Kent Sepkowitz writes in "Eat Crap" (I would have called the article "Eat Shit and Live", but Slate.com might not have liked that).

The same can be said of companies. So here are five adverse conditions that can strengthen and build character in a company:

  1. Not Enough Customers

    If you can't find enough customers, then you will have to focus on satisfying and delighting the few customers you do have. Go above and beyond with stellar customer service. Not only will they love you for this, but they will be a useful source of suggestions and improvements too. Happy customers are a fantastic marketing tool.

  2. Not Enough Money

    If you can't make enough money, then you will have to operate frugally and be intelligent with your expenses. Many a start-up has failed because it was too fat with cash and never learned how to be financially disciplined. Fortunately, you won't have this problem. In fact, some experts believe that this is the smartest way to start a business.

  3. Not Enough Employees

    If you can't recruit enough talented people, then you and your small staff can pitch in and do whatever it takes to succeed. All of you will learn a wide variety of skills, allowing for a cross-pollination of skills and potentially new efficient practices. This also tightens your staff into a finely-tuned team.

  4. Too Many Competitors

    If you have all these sharks circling the waters you, then you will have to learn how to walk on water. Having too many competitors means you'll need to learn how to differentiate and offer something everyone else doesn't. Competitors are good this way because they can keep you on your toes.

  5. Shrinking Market

    If your market is shrinking, then you will have to branch out to new markets. Even if the few customers you have left are utterly delighted, if the customers no longer need your solution, then you will need to solve a new problem for them. Take stock of your strengths, look for a more feasible market, and reposition yourself.

I decided to remove the banner ads from this site. They slowed down the site (by slowing the browser's parsing & rendering of the client-side code), were annoying & irrelevant (why would readers of this site want to see hentai ads?), and detracted from the content. Their earnings, though nice, weren't worth their negative impact on the user experience.

Instead, I've decided to humbly ask for free coffee, drinks, and books. Hehe.

If you like this site and the content here, would prefer to see it without banner ads, and are in need of some good karma, buy me a coffee! Me and my caffeinated heart thank you.

Buy me a book from my Amazon.com Wish List


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