Late last week, the Chinese government once again warned Google that if it tried to stop censoring Internet searches in China, the act would be seen as being "irresponsible" and for Google to then expect retaliation from the Chinese government, the New York Times reported.
"If [Google] takes steps that violate Chinese laws, that would be unfriendly, that would be irresponsible, and they would have to bear the consequences."
The FT also quoted Minister Li as saying, "[Google] has taken 30 per cent of the Chinese search market. If you [Google] don't leave, China will welcome that, if you don't leave, it will be beneficial for the development of the Internet in China."
In other words, play by our rules or leave.
In January, after it was hit with a major hacking attack, Google said that it was reviewing its operations in China and also well that it would stop censoring Google searches in China.
However, if Google does stop censoring searches in China, its Chinese employees could be arrested as law-breakers. This places Google in a difficult position, unless it stops offering search altogether.
Google said in the New York Times story that it expected a decision on what it would do in the next few weeks, but the FT said that Google was 99.9% certain to leave China sooner than that.
A story in today's San Jose Mercury News says that Google is now trying to protect its other businesses in China such as its "maps, mobile phone and language translation services" which are generating good revenues for the company.
Even if Google were just to shut down its search capability in China, I doubt that the Chinese government would allow Google to stay without some punishment being imposed. The government needs an example to show it's more powerful than any mere foreign business entity, and Google has placed itself right in the government's sweet spot.