Richard Waters at the Financial Times, reports that a source "familiar with the company’s thinking" has told him that Google is 99.9 percent certain it will close its Chinese search service.

...the company is likely to take some time to follow through with the plan as it seeks an orderly closure and takes steps to protect local employees from retaliation by the authorities, the person familiar with its position said.

Google is also seeking ways to keep its other operations in China going, although some executives fear that a backlash from the Chinese authorities could make it almost impossible to keep a presence in the country.

Foremski's Take: The move was expected following yesterday's remarks by a senior Chinese government official that censoring the Internet was vital for public stability.

Looks Like Google Is Out Of China - Senior Official Says It Must Obey The Law

It also shows that there is a deep division within the ranks of Google's leadership. Eric Schmidt, the CEO, has repeatedly said that Google is committed to China. But he was unable to persuade Larry Page and Sergey Brin, the co-founders, from separating their concerns about censoring Internet search results in China, from Google's business in China.

It is unlikely that Google can maintain operations within China because any foreign business requires the approval of the Chinese government. Google has shown itself to be in opposition to the Chinese government -- this is an untenable position.

This also means that Google will unlikely be able to take part in joint ventures with others in China. In early February, Reuters reported that Google is a member of a consortium led by Disney, to buy a large stake in Bus Online, a large Chinese advertising company. It's difficult to see how this deal will go through with Google as a member, if it is an opponent to the government's censorship.

This means Google is barred from the world's largest and fastest growing Internet market.

The McKinsey Quarterly just published an article titled: "China’s Internet obsession" [free registration] looking at the market Google would leave behind.

Here are some extracts:

...by the end of 2009, the number of Internet users in China had touched 384 million, more than the entire population of the United States. That’s an increase of around 50 percent over 2008. Moreover, 233 million Chinese—twice as many as in the previous year—accessed the Net on handheld devices, partly because China’s cellular providers started offering 3G services widely last year.

...

People in the 60 largest cities in China spend around 70 percent of their leisure time on the Internet, according to a survey we conducted in 2009. In smaller towns, the corresponding number is 50 percent. The PC is fast replacing the TV set as an entertainment hub...
...
One in five consumers between the ages of 18 and 44 won’t purchase a product or service without first researching it on the Internet. They shop online at auction Web sites such as Taobao, paying for products and services with prepaid Taobao cards that the post offices sell for a small commission. The volume of e-commerce in China more than doubled last year.

...

Seismic changes are likely to take place in the Chinese consumer market because of the Internet—and we aren’t talking just about the fact that 50 million Chinese may soon have to stop using their favorite search engine, Google.

Too bad for Google it is absent from such a vital market. It's a huge blow to its business and future strategy.

But it is a bold move.

Google's founders see the issue of Internet censorship as being important enough to give up its China business. They've put a huge price on the importance of Internet freedoms -- and that's commendable.

But what future is there for Eric Schmidt? There's a big division between him and Messrs Page and Brin.

- - -

Please see:

Do GOOG Founders Still Need Adult Supervision?

Read more of this story at Slashdot.

Read more of this story at Slashdot.

Financial Times:
Google to shut China search engine  —  By Richard Waters in San Francisco and Kathrin Hille in Beijing  —  Google has drawn up detailed plans for the closure of its Chinese search engine and is now “99.9 per cent” certain to go ahead as talks over censorship with the Chinese authorities …

Benedict XVI's spokesman, Father Federico Lombardi, suggests 'tenacious' plot to implicate pontiff in cover-up

The pope's spokesman has launched a vigorous counter-attack against a report linking Benedict XVI to a sex abuse cover-up while he was archbishop of Munich from 1977 to 1981.

Father Federico Lombardi appeared to suggest in an interview on Vatican Radio that the pope, who also has strong links to the city of Regensburg, was the victim of a plot.

"It's rather clear that in recent days there have been people who have searched – with notable tenacity – in Regensburg and Munich for elements to personally involve the holy father in the question of the abuses," Lombardi said. "To any objective observer it's clear that these attempts have failed."

The Vatican has been appalled in recent days by a flood of allegations of priestly sex abuse in Germany, Holland, Austria and even Italy.

Today, the pope's former diocese rushed out a statement to pre-empt a story in tomorrow's edition of the Munich-based daily Süddeutsche Zeitung. It said that when Joseph Ratzinger was the city's archbishop he had agreed that a priest from another diocese should undergo therapy at a rectory in his own.

The records suggested that "it was known then that this therapy should probably be carried out due to sexual relations with children". But instead of sending him for therapy, the statement said, the diocese's then vicar-general, Gerhard Gruber, assigned him to a parish where at least one child was subsequently abused.

"Gruber takes full responsibility for the wrong decisions", the diocese said.

The church's attempt to bury the affair was immediately challenged by the Survivors Network of those Abused by Priests (Snap), which tomorrow is holding "sidewalk vigils" in more than 30 US cities in support of European victims.

David Clohessy, Snap's national director, said: "As a high-ranking church official for decades, if Ratzinger knew of one reassigned paedophile priest, the odds are he knows of others, possibly dozens. German secular authorities should do in Munich what Irish secular authorities did in Dublin: launch a thorough secular probe of clergy sex crimes and cover-ups."

The latest front was opened in Austria where two newspapers reported cases of abuse among choirboy in Fügen and Vienna. Today a newspaper in the predominantly German-speaking Italian province of Bolzano-Bozen recounted the story of a then 15 year-old boy who said that in the 1960s he was coerced into providing sexual services to local friars.

• Pope Benedict XVI
• Catholicism
• Germany
• Religion

In March 2009 the IFPI and several local movie studios began threatening Telenor, Norway’s largest ISP. Block your customers from accessing The Pirate Bay, they demanded, or we will take legal action and get the courts to force you.

Telenor refused to comply and was taken to court. In November 2009 the verdict was handed down – the courts decided that the ISP had no obligation to block the world’s most infamous torrent site.

The IFPI wasn’t about to give in so easily, with their lawyer Marte Thorsby insisting the court had ruled incorrectly. Music performing rights outfit, TONO, confirmed the case would go to an appeal.

In early February the Borgarting Court of Appeal announced that the appeal had been rejected as there was no basis under Norwegian law for the claim. IFPI and TONO said they would consider their options, i.e make a decision as to whether or not they would take the case to the Supreme Court.

Yesterday, in a surprise announcement – it’s not like the entertainment industries to give in so easily – IFPI and TONO said they will not take their appeal to Norway’s highest court.

“We wanted to get a legal clarification on whether under Norwegian law it is possible to order ISPs to block access to The Pirate Bay,” said TONO in a statement. “Now we have two clear decisions that there is no legal authority under Norwegian law for such blocking requirements.”

Following the November ruling, TONO said that it was possible that the authorities had not implemented the EU Copyright Directive properly in 2005, a line they continue to stand by.

“We interpret both [court] decisions as suggesting that questions have been raised about whether the EU Copyright Directive was adequately implemented in Norwegian law,” TONO added.

Marte Thorsby of the IFPI said that continuing with legal action would be a waste of time and money, and joined TONO in their calls for clearer legislation.

“The Court of Appeal wrote in its ruling that the limits of complicit liability are unclear, and we expect that the ongoing revision of the Copyright Act will close this legal ‘hole’,” said Thorsby.

Article from: TorrentFreak, check out our new blog at FreakBits.

Google is "99.9%" certain to close down its Chinese search engine, the FT reports after speaking with a source at the company.

Even after Google closes the search engine, it will take time to close down the business and the FT says Google wants to "takes steps to protect local employees from retaliation by the authorities."

Read the rest of this story »

See Also:

• China Tells Google To Go To Hell, Again
• Motorola Doing Its Best To Take Google Search Out Of Android Phones In China
• Caught Red-Handed, China Is Talking To Google Again

It seems you can be ethical but poor when it comes to Internet business practices. The FBI estimated that Internet business scams doubled last year to reach $560 million.

In a delightful irony, the most popular scam used the FBI's name, reported the Associated Press:

The most frequently reported scams were those that falsely used the FBI's name, accounting for 16 percent of the more than 300,000 complaints received last year. Authorities say another scam involved messages with a voice similar to President Barack Obama's, urging people to visit a Web site to claim a share of government stimulus cash. Visitors are charged a fee, and no money is ever received.

There are a whole range of scams, including diet, work-at-home, dating and many others. Once the scammers get hold of peoples' credit cards, it is difficult to cancel monthly subscriptions. This is made even worse when scammers get hold of people's debit card numbers because it can lead to overdrafts and high bank charges.

Neighbours were oblivious that recluse who froze to death in her home was first black woman on South Carolina legislature

The neighbours knew Juanita Goggins only as an elderly recluse with no friends and a family that was rarely seen.

Goggins was so private that she instructed a neighbour who delivered groceries to leave them at the door, ring the bell and go away before she emerged. She spurned offers of home help from the local authorities even though she was evidently finding it increasingly difficult to look after herself.

So the residents of her South Carolina community were saddened, if not entirely shocked, to hear that the 75-year-old woman had frozen to death in her own home and that her body went undiscovered for nearly a fortnight.

But in the days before her funeral today, they were surprised to learn that at one time Goggins had been a trailblazing politician and civil rights activist who shook up South Carolina's exclusive politics as the first black woman elected to the southern state's legislature.

That same legislature last year honoured Goggins, who was also the first black woman to serve on the government's civil rights commission and who was twice invited to the White House by President Jimmy Carter, by naming a highway after her. But that didn't catch the eye of the people who lived around her. It was Goggins's neighbour of 16 years, Erskine Hunter, who dropped off the groceries and left before she answered the door.

He also tended her lawn but was invited in only once, to fix a water heater. He knew nothing of her past. "I miss her," he told the Associated Press. "I don't know why I didn't go over there and hammer on the door."

The first that Linda Marshall knew about the woman whose rent she collected each month was reading an obituary. "She needed someone to assist her, but anyone who tried to get close, she'd block them off," she said. "She was very fragile. This was something I always dreaded."

Goggins was the youngest of 10 children and the only one to make it to college and earn a degree at what was then the all-black South Carolina state college. She went on to become a teacher in the segregated school system.

She had experienced discrimination but working in the education system she saw how even after segregation was formally abolished it lived on through bureaucratic practice, funding priorities and racial attitudes. She was determined to change that, so she entered politics and in 1972 became the first black woman to represent South Carolina at the Democratic party's national convention. Shortly after, she was the first black woman appointed to the US government's civil rights commission.

Then in 1974, Goggins beat a white man to win a seat in the South Carolina legislature in Columbia.

"I am going to Columbia to be a legislator, not just a black spot in the House chambers," she said at the time.

Goggins said that voters "were weary of poor representation". "They were ready to accept a person who was sincere and concerned about things. Those feelings go beyond colour," she said.

She made her way on to the powerful committee drawing up budgets, and used her position to win funding for sickle-cell anaemia, a blood disorder that disproportionately affects the African American community. She pushed through important reforms to education affecting school funding and class sizes.

"She was truly a mover and a shaker, so well-liked and so well-loved by so many," said John King, who now holds Goggins' former seat.

Goggins' last surviving sibling, Ilese Dixon, 88, wasn't surprised that her sister achieved so much as a politician.

"She was not bashful or anything. She liked to talk. I used to say she could sell an Eskimo ice. She was just lively and smart. She thought she could fix the world," she told the Associated Press.

After Goggins retired from politics, she worked for the state's health and environment department. But she became increasingly withdrawn after moving to a quiet neighbourhood in Columbia in the early nineties.

Goggins had distanced herself from her family, who suspected she was suffering from dementia. Her former husband, Horace, said that she "divorced herself from family and friends".

"I tried to communicate with her and went down there to Columbia many times," he told South Carolina's Herald newspaper. "She wouldn't accept contact from anybody."

Goggins became even further withdrawn after she was mugged near her home. She put new locks on the doors and rarely left the house.

She died of hypothermia after snow hit South Carolina last month. It was nearly two weeks later, when one of her neighbours noticed that he had not seen her lights go on for some time, that concerns were raised and the landlord called the police. They found Goggins wrapped up in several layers of clothes. The electricity had been cut off after she failed to pay the bill but the police found hundreds of dollars in cash in the house.

Goggins' only son, also called Horace, said that despite the sad circumstances of his mother's death, it is an opportunity to remind people of the trailblazer she once was. "I want her to be remembered as a positive role model, not only for African-American girls, but also any young girl who has a want and a desire to make a change and do something positive," he said.Life of Juanita Goggins1935 Born to sharecroppers in South Carolina

1972 First black woman to represent South Carolina at the Democratic party's national convention.

1974 First black woman appointed to the US civil rights commission.

1974 First black woman elected to South Carolina legislature. Served three terms.

1976-80 Twice invited to the White House by President Jimmy Carter.

1977 Instrumental in passing a law that remains the basis for education funding in South Carolina, helping to reduce class sizes.

1980s Leaves legislature to become a social worker. Increasingly reclusive and estranged from her family who fear she is suffering from mental illness.

2009 Part of Highway 5 in Rock Hill, South Carolina, named after Goggins.

• United States
• US politics
• Race issues

Chinese authorities are pounding their desks over compliance with the law as Google's C-Day approaches. The "C" is for Censorship, of course, which Google plans to lift in China sometime in the near future. The company has been in talks with China ever since the highly publicized hack earlier this year, and although the two may not be in agreement over what to censor, it seems likely that Google will keep at least some of its business in China.

"Google has made its case, both publicly and privately," China's Minister of Industry and Information Technology Li Yizhong told the press on Friday when questioned about censorship, according to Reuters. "If you don't respect Chinese laws, you are unfriendly and irresponsible, and the consequences will be on you."

Translation: in this game of chicken, the Chinese government won't be the one to budge. Meanwhile, a person "familiar with the talks" told the Wall Street Journal that the company isn't likely to pull out of China altogether if this censorship experiment goes sour. Google is apparently putting together a "patchwork agreement" with a number of different Chinese agencies so that it can continue operating to some degree in China.

One thing's for sure: the status quo won't hold. The WSJ's source claims a decision will come within weeks, and Google CEO Eric Schmidt indicated at a press conference in Abu Dhabi that "something will happen soon."

If Google opens the floodgates on previously censored topics like the Dalai Lama or the Tiananmen Square protests, there's little stopping China from taking measures to block the site like it already does with numerous others. There are plenty of workarounds for crafty Internet users, but we wouldn't be surprised to see this happen if China and Google are unable to come to an agreement.

Read the comments on this post

Chinese authorities are pounding their desks over compliance with the law as Google's C-Day approaches. The "C" is for Censorship, of course, which Google plans to lift in China sometime in the near future. The company has been in talks with China ever since the highly publicized hack earlier this year, and although the two may not be in agreement over what to censor, it seems likely that Google will keep at least some of its business in China.

"Google has made its case, both publicly and privately," China's Minister of Industry and Information Technology Li Yizhong told the press on Friday when questioned about censorship, according to Reuters. "If you don't respect Chinese laws, you are unfriendly and irresponsible, and the consequences will be on you."

Translation: in this game of chicken, the Chinese government won't be the one to budge. Meanwhile, a person "familiar with the talks" told the Wall Street Journal that the company isn't likely to pull out of China altogether if this censorship experiment goes sour. Google is apparently putting together a "patchwork agreement" with a number of different Chinese agencies so that it can continue operating to some degree in China.

One thing's for sure: the status quo won't hold. The WSJ's source claims a decision will come within weeks, and Google CEO Eric Schmidt indicated at a press conference in Abu Dhabi that "something will happen soon."

If Google opens the floodgates on previously censored topics like the Dalai Lama or the Tiananmen Square protests, there's little stopping China from taking measures to block the site like it already does with numerous others. There are plenty of workarounds for crafty Internet users, but we wouldn't be surprised to see this happen if China and Google are unable to come to an agreement.

Read the comments on this post

Report for United States Bankruptcy Court says City law firm approved off balance sheet transactions that disguised true state of Lehman Brothers' finances

Linklaters, one of London's premier law firms, is battling to defend its reputation after a US report into the failure of Lehman Brothers showed it approved controversial deals that shifted billions of dollars of debt off the balance sheet in the years before the bank collapsed.

The hard-hitting report found that the crucial deals, which were also sanctioned by Lehman's auditors, Ernst & Young, were described as "window dressing" by bank staff and masked the precarious state of its finances while it was under scrutiny from regulators and investors.

Linklaters is expected to come under intense pressure to reveal the full extent of its dealings with Lehman in the run-up to the bank's crash in September 2008. The firm is one of the "magic circle" of solicitors operating in the City, which in recent years have expanded rapidly to compete with US rivals.

The impact of the bank's crash has been described as incalculable by some economists after governments around the world were forced to implement trillion-pound bailouts for their own banks caught up in the disaster. Investors are preparing lawsuits against the bank and are expected to turn their fire on lawyers and auditors advising it.

The report, for the United States Bankruptcy Court by examiner Anton Valukas, claims Lehman booked fund transfers as sales and failed to disclose them in regulatory filings in the US. Valukas alleges that Lehman turned to Linklaters after New York law firms said that they were unable to approve the deals under US law.

It was common practice to use so-called "Repo 105" agreements at Lehman to sell and buy back funds, but their frequent adoption in the two years before its collapse amounted to balance sheet manipulation, the report said.

Linklaters dismissed suggestions that it played a central role in disguising Lehman's mounting debt pile. A spokesman confirmed that the firm gave opinions on several transactions, but said it was not aware of any "facts or circumstances that would justify any criticism".

He also pointed out: "The examiner, who did not contact the firm during his investigations, does not criticise those opinions or say or suggest that they were wrong or improper."

Valukas said that the part played by auditors Ernst & Young was also crucial to hiding the fund transfers, and amounted to professional negligence.

UK regulators came under scrutiny in the report for their role during Lehman's collapse. While Hector Sants, the Financial Services Authority chief executive, refused to give evidence directly to the US investigator, he published written evidence that showed a series of transatlantic telephone calls during which the US authorities begged the UK to help facilitate a possible takeover by Barclays.

The FSA's evidence claims that Christopher Cox, then chairman of the US regulator the securities and exchange commission, was still lobbying the FSA at 3pm on Sunday 14 September – hours before Lehman called in administrators. Cox wanted the FSA to waive rules that required Barclays to hold a shareholder vote before the deal could take place.

Barclays later bought Lehman's US businesses from the administrator.

• Lehman Brothers
• Law
• Barclays
• Financial crisis
• Credit crunch
• US economy

Dozens killed as two suicide bombers try to blow up military convoy passing busy market

A bombing in the eastern city of Lahore has killed at least 43 people – the fifth terrorist attack this week as extremists in Pakistan demonstrate their continued ability to strike.

The bloodiest terrorist strike in Pakistan this year was carried out by two attackers wearing suicide jackets who walked into a busy market in a high security military district and blew themselves up. The target appeared to be passing military vehicles but most of the victims were civilians.

Shops in the market were ripped apart, with children crossing the road and people waiting at a bus stop among the victims. About 10 soldiers were killed and 100 injured, said the Lahore police chief, Parvaiz Rathore.

"There were about 10 to 15 seconds between the blasts. Both were suicide attacks," a senior local government official, Sajjad Bhutta, said at the site.

"The maximum preventative measures were being taken but these people find support from somewhere."

The bombers struck at 1pm, around the time of Friday prayers, in the cantonment area, home to the local army garrison and one of Lahore's most upmarket residential districts.

Lahore is the bustling cultural hub of Pakistan and had enjoyed several weeks of relative peace. It is the capital of the eastern Punjab province, Pakistan's most densely populated area and its political heartland.

The suicide bombings were followed in the evening by three smaller blasts in a residential area across town. They caused panic but damage was reported to be minor.

The authorities repeated their regular assertion that the Taliban and other extremist groups have been defeated. The provincial law minister, Rana Sanaullah , said: "We broke their networks. That's why they have not been able to strike for a considerable time."

But it was the second bombing this week in Lahore. A car bombing on Monday at a police interrogation centre killed 14 people. Other attacks this week included a gun and grenade assault on a US Christian aid agency's office in the north-west, killing six of its staff, all Pakistani nationals.

"They (the extremists) are trying to project their power, telling the government that they are still alive," said analyst Imtiaz Gul, author of The al-Qaida Connection. "They are still far from broken. It's going to be a long haul."

In 2009 that Lahore was dragged into the bloody insurgency in Pakistan, which claimed around 3,000 lives last year, with a series of spectacular attacks including a gun assault on the visiting Sri Lankan cricket team. The last major attack in Lahore was in December when a market was bombed, killing at least 49 people.

The launch of a military offensive in South Waziristan, on the Afghan border, the base of the Pakistani Taliban, in October last year was accompanied by a vicious spate of terrorist reprisals but the country had been relatively peaceful this year.

• Pakistan
• Global terrorism
• Taliban
• al-Qaida

Joe McDonald with the Associated Press, today reported:

China's top Internet regulator insisted Friday that Google must obey its laws or "pay the consequences," giving no sign of a possible compromise in their dispute over censorship and hacking.

"If you want to do something that disobeys Chinese law and regulations, you are unfriendly, you are irresponsible and you will have to pay the consequences," Li Yizhong, the minister of Industry and Information Technology, said on the sidelines of China's annual legislature.

That's a position that has no room for negotiation.

Yet Eric Schmidt, CEO of Google, earlier this week was reported by Jerry Dicolo at the Wall Street Journal, saying, "We are in active negotiations with the Chinese government." He added that "something will happen soon."

What are they negotiating over? The Chinese position is crystal clear: we're not budging.

It has been two months since Google threatened to leave China as a response to attacks by hackers it said were agents of the Chinese government. It said it would stop censoring Google search results in China.

Li Yizhong told the AP that China will continue to censor Internet content for the public good.

"If there is information that harms stability or the people, of course we will have to block it," he said.

The Chinese government has repeatedly denied that it was the source of the hacker attacks on Google and has said it would severely punish any Chinese hackers but that Google had not made an official complaint, or provided any evidence.

Foremski's Take: It looks as if Google has painted itself into a corner in China. By saying it will stop censoring its results and that it may have to leave China, it has left itself with no options. Negotiations with the Chinese government have produced no compromise from the authorities.

It's interesting to speculate what those negotiations could have been about. What could Google offer in return for being allowed to stay in China but not censor its search results?

The Chinese authorities are far more skillful in these types of situations than Google's leadership.

Will Google still maintain research, and sales operations in China, but withdraw its search service? What about its other products such as GMail, etc? Will Google's spiderbots still index Chinese web sites?

Leaving the world's largest and fastest growing Internet market is a serious blow for Google, especially if it turns out that the hacker attack was not of Chinese origin.

[Were Google Hackers Amateurs Or Chinese Cyber Commandos?]

- - -

Please see:

Criminal Penalties Coming For US Internet Companies That Don't Protect Human Rights Abroad

Is Sexual Blackmail An Issue In China Cyber-Hacking Of US Companies?