First Google, then GoDaddy. Who's next to leave China? Yahoo!

I'm predicting that Google's major competitor Yahoo will be next to leave China.

Because it was hacked, stolen from and forced to help the Chinese Communist Party violate Article 19 of the Universal Declaration of Human Rights, Google left China.

Now Internet domain seller GoDaddy.com has announced that it will no longer register domain names in China using the .cn suffix. Its reasons are similar to Google's.

GoDaddy.com's top lawyer, Christine Jones, told a congressional commission hearing this week that (like Google), the company had been hacked "due to a lack of enforcement against criminal activities by the Chinese government." Also, the Chinese government has been forcing GoDaddy.com (and all other registrars) to get photos, business ID and signatures for anyone registering a .cn domain.

Other companies are coming under fire for helping the Chinese government repress its people, rather than refusing as Google and GoDaddy are doing.

Republican New Jersey Congressman Chris Smith slammed Microsoft in the meeting, saying that Microsoft needs to "get on the right side of human rights rather than enabling tyranny, which they're doing right now." Microsoft responded by saying: "We remain committed to advancing free expression through active engagement in over 100 countries, even as we comply with the laws in every country in which we operate."

While Google and GoDaddy are leaving, other companies will probably never enter. Facebook and Twitter are two examples.

Google left. GoDaddy isn't taking new orders. Who's next?

(A rumor circulated this week that Dell might move Chinese operations to India, based on a comment by the Indian Prime Minister, but Dell denied that it has any such plans.)

Based on a sample of two companies, Google and GoDaddy, we can construct a profile of what kinds of companies might also leave China. In both cases, these companies offer Internet services to the Chinese public used for exercising Article 19 human rights. And in both cases, the Internet business is more than 95 percent of the total business attempted in China.

Based on this profile, any company based outside of China that offers any sort of online communications service that might be used for expressing or "consuming" political, cultural or historical ideas as its sole or main business is a candidate for imminent departure.

Companies like Microsoft, however, are not. Microsoft mainly sells software. Although it provides Internet search, e-mail and the rest, the company is unlikely to jeopardize it's software business by taking a stand against censorship, industrial espionage and oppression.

My prediction is that Yahoo will be the next major company to announce a pull-out or scale back of operations in China.

What's your prediction?

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