It’s been nearly two weeks since representatives of Cisco, Microsoft, Yahoo and Google testified before the House Subcommittee on Human Rights about their various entanglements with China. As expected, after blowing hot in the run-up to the testimony, coverage has cooled a great deal. Unless there is substantial progress with Rep. Chris Smith’s proposed legislation, the issue will probably stay cool until the next crisis moment emerges. But emerge it surely will.
I read the written testimony submitted by the four companies, although I’ve not read a full transcript of the Q&A. All the companies pretty much responded as expected. They all, without fail, talked about the transformative power of the Internet and the benefits it is bringing to China. They all tried to explain how they’ve weighed the implications of being in China.
They also all addressed the specifics of their individual cases. Cisco explained that it sells the exact same equipment to China that it sells to anyone else, without special modification, and that the technology that enables content filtering is the same that enables network security. Yahoo addressed the Shi Tao case, and the fact that operational control of Yahoo China lies essentially entirely with Jack Ma’s Alibaba.com (a risk that may haunt them in future, since it may place the brand at risk). Microsoft discussed the Michael Anti case. And Google, of course, discussed the considerations that went into the recent launch of their self-censored google.cn site, as well as the ongoing drop in their market share that they feel is rooted in filtering-based performance issues.
It was thoughtful, rational and articulate. It was full of motherhood statements about the Internet company values. It was, in short, exactly what you’d expect from three general counsels (Microsoft, Yahoo and Cisco) and a vice president of global communications (Google).
For instance, here is Microsoft Associate General Counsel, Jack Krumholtz:
Will the citizens of that country be better off without access to our services, or will their absence just vindicate those who see our presence in the country as threatening to their official or commercial interests?
And Yahoo General Counsel, Michael Callahan:
First, our principles. Since our founding in 1995, Yahoo! has been guided by beliefs deeply held by our founders and sustained by our employees. We believe the Internet can positively transform lives, societies, and economies.
These were all the messages that needed to be delivered. But I see two problems. First, as expected, they lost the war of imagery and emotion. Out of necessity, the companies needed to be defensive and rational. Unlike their interrogators, who are playing to voters only, they are playing to three separate constituencies: the general public who are their customers and advertisers; the shareholders to whom they have fiduciary obligations; and the Chinese government, who was no doubt watching very carefully. Addressing all three of those audiences requires a measured and diplomatic approach. But in the war for general public opinion, they are then left contending with statements like this from Representative Chris Smith:
Through an approach that monitors, filters, and blocks content with the use of technology and human monitors, the Chinese people have little access to uncensored information about any political or human rights topic, unless of course, Big Brother wants them to see it. Google.cn, China’s search engine, is guaranteed to take you to the virtual land of deceit, disinformation and the big lie.
But the worst came in an act of confrontational demagoguery from Congressman Tom Lantos, a man who represents Imagethief’s home constituency in the San Francisco Bay Area, who carries the unimpeachable aura of a Holocaust survivor (a fact cited in most articles I read about his participation in the subcommittee) and who has long taken a dim view of China’s government (opposed WTO entry, opposed awarding the Olympics, etc.). Lantos notoriously called all four company representatives on the carpet, asking each in turn if he was ashamed of the actions of his company. From a longer transcript on CNET:
Rep. Tom Lantos: Can you say in English that you’re ashamed of what your company and what the other companies have done?
Google: Congressman, I actually can’t, I don’t think it’s fair for us to say that we’re ashamed.
Lantos: You have nothing to be ashamed of?
Google: I am not ashamed of it, and I am not proud of it…We have taken a path, we have begun on a path, we have done a path that…will ultimately benefit all the users in China. If we determined, congressman, as a result of changing circumstances or as a result of the implementation of the Google.cn program that we are not achieving those results then we will assess our performance, our ability to achieve those goals, and whether to remain in the market.
Yow. Trapped. A seven word question that will stick in everyone’s head, and an eighty-three word response that no one will remember, but precious few better options considering those three different constituencies. Maybe I’m getting conservative in my middle-age (I’m a longtime liberal Democrat), or maybe the CCP is spiking my drinking water, but I didn’t think much of Mr. Lantos’ approach. Here is another statement, from the press release Lantos issued the day before the hearings:
“The hugely successful businesses that come before Congress tomorrow will have to account for their complicity in China’s culture of repression, and to begin to make amends,” Lantos said. “Government can be expected to do only so much. It is up to these wealthy entrepreneurs to help ensure that the free flow of information from which they have profited is offered worldwide.”
Well, aside from the fact that the final statement is patently wrong, this does raise a very interesting question that cuts to the heart of my complaint about how the companies dealt with the hearings. While I don’t think the wealthy entrepreneurs have any obligation to ensure that a free flow of information is offered worldwide (that ignores political realities that extend far beyond China and in cases may simply not make business sense), I am a little mystified as to their silence.
Here is why. The technology industry suffers from an interesting syndrome. It is a time honored practice among tech companies to build founders and CEOs up as evangelical prophets of the transformative power of technology, which is promoted as revolutionary and encompassing in a way that, say, shipping, fast-moving consumer goods, cars, energy, and so on are not. No industry is more susceptible to the CEO/founder cult of personality or mystique, and no industry more flagrantly positions founders and CEOs as “visionaries” than the tech industry does. This is especially important in the Internet generation of companies, all of whom were created in the last fifteen years and are still led by founders. It is only slightly less true for Microsoft.
The cult of the youthful billionaire genius touches three of the four companies involved in these hearings. Bill Gates of Microsoft may be the pre-eminent technologist of the age. Jerry Yang and David Filo of Yahoo are famous and highly visible, as is CEO Terry Semel, a Hollywood veteran who knows a thing or two about showmanship. And Sergey Brin and Larry Page of Google are in a league all their own. Cisco may suffer from less of this syndrome because, although it is young and CEO John Chambers is well known, it is not first and foremost a consumer oriented firm as the other three are.
Where were all these Internet visionaries as this storm broke?
This is an important question because, Cisco aside, these firms are all, for better or for worse, closely associated with the personal values of their highly visible founders. Those values are part of what defines their public images and brands. This is especially true of Google, where the relationship between the founders’ values and the company’s values are formalized in the “Don’t Be Evil” mantra that has become such a millstone during the controversy. On page 211 of David Vise’s book, The Google Story (as unanalytical a bit of hagiography as you will find), it is recalled that:
Stanford Professor Terry Winograd says that Segey [Brin] has lead the way on three Ps: Policy, Politics and People. (When once asked what the motto Don’t Be Evil meant, CEO Eric Schmidt famously replied that evil is whatever Sergey says is evil.)
And on page 257 it says.
[Google's] very motto, Don’t Be Evil, was a thinly veiled way of letting the technologists of the world know that Larry and Sergey were not just the Google Guys, but the Good Guys, who did the right thing for users and employees and had fun too.
That’s channeling founders’ values through the company, and using them to build the brand. Michael Callahan of Yahoo does the same thing in his testimony, quoted above. And it makes the silence of all these technology luminaries in the breach seem odd and somehow discordant.
One of the most common requests that crosses Imagethief’s desk is for communication plans to help technology executives position themselves as “thought leaders”. Unfortunately, “thought leadership” is an often abused concept in PR, with salesmanship, cheerleading and banality often masquerading in its place. The most interesting proposals are often rejected as too risky. Certainly thought leadership is easier when times are good. But it’s important when controversy arises, such as now. On the table is one of the most important issues of our time: what is the relationship between a commercial Internet and the right to freedom of speech, and should the American companies who are driving the evolution of the Internet be considered international custodians of that right?
Leadership is about risk (something that these entrepreneurs all know). Thought leadership is about intellectual risk. If it is unlikely to be argued with or shouted down, it’s probably not thought leadership. This was an opportunity for thought leadership if ever there was one. But there was little thought leadership to be had. That is a shame, because I am sure that all of these phenomenally bright and opinionated technologists are thinking deeply about this issue and debating it inside their companies.
But maybe there was no other choice. As I noted above, the companies are burdened with three different audiences, each of which has a substantially different interest in this situation. Consumers and advertisers want to feel good about the brands of the companies they patronize. Shareholders want growth. China wants foreign firms to toe the line and avoid controversy. Employees may even constitute a fourth important group in this kind of situation. That puts the companies in a supremely delicate position, where every public communication has to be considered from multiple angles if a disaster is to be averted.
But if you build your brand on the company founders’ values and leadership, and they then remain silent when those values are being questioned and leadership is most necessary, then your brand is at risk. And, in the meantime, people with fewer stakeholders to please will hammer at you from all sides.