FBR ANALYST HEATH TERRY TALKS GOOGLE AND CHINA ON BLOOMBERG TV
JANUARY 13, 2010
SPEAKERS: HEATH TERRY, ANALYST, FBR CAPITAL MARKETS
DEIRDRE BOLTON, BLOOMBERG NEWS
(This is not a legal transcript. Bloomberg LP cannot guarantee its accuracy.)
06:48
DEIRDRE BOLTON, BLOOMBERG NEWS: FBR Capital Markets analyst Heath Terry is with us now with a little bit more on why Google is threatening to leave China. Heath, so glad to have you with us here in the newsroom.
HEATH TERRY, ANALYST, FBR CAPITAL MARKETS: Thank you, Deirdre.
BOLTON: Thanks for joining us. You were in the studio in the newsroom just a few moments ago. We were speaking with an FT reporter, Ben McClanahan, and he made the point revenue-wise, if Google pulls out of China it's really not that big of a deal to their bottom line.
TERRY: Absolutely. I mean, this is when you've got to do this. You've got to do it when it's not as important financially and when, you know, honestly for Google, this is at a decision point where they've got to decide whether to commit more resources to China or to make this decision.
BOLTON: Yet it seems to be very extreme when we're talking about China as the land of opportunity. I mean for the past few years investors have Cartier Replica Watches spoken almost of nothing but getting into China. So does it make Google look bad if they talk about pulling out?
TERRY: You know, Google has always been a company that at least from the outside has been about their ethics, their morals. I mean from the very first founders letter about "don't do evil" -
BOLTON: "Don't do evil," which was a very famous line.
TERRY: Absolutely. This was a big part of what the company's about, and I think they're one of the few companies that can kind of stand up and take this moral ground of saying you know what? We're just not going to be part of this anymore.
BOLTON: And just let's review, I guess, the context, right, that the Chinese government, the accusation anyway, is that they want to block emails that have the words human rights or make an allusion to human rights issues from Gmail.
Zenith Replica WatchesTERRY: Right, and you know, this started way back when they insisted on filtering results and it kept going forward filtering YouTube, and it's just gotten to the point where this is taking it too far for Google.
BOLTON: Because Ben from the FT did make the point as well. Other countries have insisted on certain filters and Google has gone along with it, so now it's gone too far. But do you really think Google is going to pull out or are they just kind of starting the conversation?
TERRY: I think it's exactly that. I think they're starting the conversation. If they have to pull out they'll pull out, but I think, you know, the Chinese government realizes how bad it would look for them if Google pulls out of the country. I think the Chinese consumers have grown to be able to trust Google as Ben mentioned.
You know, you've seen market share for Google climb very steadily in China despite the fact that you've got some very big entrenched competitors there, and so for, you know, imagine taking Google away from U.S. consumers. They wouldn't be happy about it, and this is just going to put that much more pressure on the Chinese governme
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