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MM04

International Marketing

(For CNM Cases)

Assignment – I

Assignment Code: 2016MM04A1                                                                Last Date of Submission: 30^th April 2016

                                                                                                                                  Maximum Marks: 100

Attempt all the questions.  All the questions are compulsory and carry equal marks.

Section-A       

1.         Distinguish between the ethnocentric and polycentric approach to international                                   Marketing?  Under what circumstances is the polycentric strategy a preferred approach for                                  International Marketers? Give examples to support your answer

2.         Discuss the critical cross cultural challenges encountered by international marketing                                   Managers? Discuss how these challenges can be addressed by multinational firms?

3.         Explain why the Uruguay round of GATT is one of the most prominent rounds of trade                                 negotiations? After WTO replaced GATT - What are the pivotal issues related to                           Emerging economies which WTO needs to address immediately?

4.         Explain the difference between the Theories of Absolute Advantage and Comparative                                   Advantage related to foreign trade? Briefly describe the concept of the Factor                                   Endowment Theory of Foreign Trade? Do you perceive that the assumptions of these                                   trade theories are realistic?

Section-B

Case Study: Global Environmental Scanning

Google's Problems in China

Google was founded by Larry Page (Page) and Sergey Brin (Brin), who were students at Stanford University, California, USA. While at Stanford, Page logged on to the World Wide Web, looking for a topic for his doctoral thesis. He decided to work on the link structure of the Web. He found that though links from one page to the other could be followed easily, it was important to keep track of the back-links as well. He started working on back links and called his project 'Back Rub.' Brin joined Page in working on Back Rub. Together, they created a ranking system which ranked the links depending on their importance. They came up with an algorithm called PageRank which took into account the number of links to a particular site and the number of links into the linking sites.

Google Meets 'The Great Firewall'

On January 25, 2006, the US based Google Inc. (Google), the world's largest search engine, announced that it was ready to censor the content that it made available in China. Google's Chinese website www.google.cn would be censored by the company itself on the basis of the instructions of the government. Before this, the government agencies in China used to censor the content on Google's site that violated the regulations imposed by the Chinese government on Internet usage and access in China. The topics that were sensitive for the Chinese government included Tiananmen Square, Tibet, the Dalai Lama, Taiwan independence, human rights and the Falun Gong spiritual movement.

            Google had been providing services for users in China through its global search engine www.google.com, which has its servers in the US. This meant that the content had to pass through Chinese firewalls, which often stalled the browser and slowed it down. 

            The slowdown was also associated with filtering and censorship carried out by the Chinese government and Internet service providers (ISPs). For this reason, Google decided to place its servers in China and agreed to self-censor the content and let the users know of it. However, human rights activists and advocates of freedom of the press all over the world expressed their displeasure at Google's move.

            After censorship, users searching for 'Falun Gong spiritual movement', for example, would be directed to sites and articles condemning the movement; sites that supported the movement were omitted from the search. Google was of the view that after censoring its content, the company's website would become easily accessible in China. The company announced, "In order to operate from China, we have removed some content from the search results available on Google.cn, in response to local law, regulation or policy." Google also announced that users would be informed whenever access was restricted. 

            A survey carried out by China Interne Network Information Center in August 2005 revealed that Google was losing market share to its competitor Baidu.com, which had emerged as the leading search engine in China.

Google in China

In September 2000, Google began operating a search engine in Chinese by offering 24 million web pages in Chinese language as localization had tremendous customer appeal and Chinese internet users preferred consulting internet sites having Chinese language. By 2002, Google had gained lot of popularity in China owing to its simplicity and ability to carry out searches effectively.

            During that time, the Chinese government was blocking several websites through IP filters intermittently. The blocking increased during times of heightened security like the anniversary of Tiananmen Square events, the national party congress, etc. But users of Google could circumvent the government censorship through cached pages...

Google Loses Market Share

By early 2004, users in China had thought that Google was unreliable and started using alternative search engines. Elliot Schrage, Vice-president, Global Communications and Public Affairs of Google said that Google was seven times slower than its rival Baidu and Google itself was not happy with the way its services were being operated in the country...

The Launch of Google.cn

Google wanted to have a major presence in China. The market was lucrative because of its size. China had the second largest number of Internet users after the US. Google felt that only a local presence could help it to provide better and more reliable services to customers. To operate in China, Google needed an Internet Content Provider license, which required it to filter its content. In April 2005, after obtaining permission from the Ministry of Information Industry in China, Google announced the opening of a representative office in Shanghai (Mainland China), and registered the URL - www.google.com.cn...

The Road Ahead

Analysts opined that with Internet users would have a better experience after the launch of Google.cn, and Google may once again emerge as the most preferred search engine in the country. According to findings reported by Keynote Systems in January 2006, Google was in a strong position to challenge Baidu in the Chinese search engine market. The study concluded that Chinese users, once they started using Google, preferred it to any other search engine...

5.         Discussion Questions:

a.                              Briefly examine the problems faced by Google in China.

b.                              Outline the relevance of assessing the legal and business environment in the        Chinese online media industry?

c.                               Evaluate the impact of government regulations on the operations of foreign         Internet companies like Google in China? Where did Google go wrong?