From the USA Today article Bill would keep servers out of China we learn
Now, Congress is stepping in with proposed legislation that
could hobble the companies as they plunge deeper into one of the world's hottest
economies. This is Round 2 for Congress. Last year, it scrutinized and slowed
other business deals with ties to China's government among oil companies and
computer makers.
Rep. Chris Smith, R-N.J., is drafting a bill that would
force Internet companies including Google, Yahoo and Microsoft to keep vital
computer servers out of China and other nations the State Department deems
repressive to human rights. Moving servers would keep personal data they house
from government reach. But that also could weaken the firms' crucial Internet
search engines. (Related: AOL tries to speak Chinese.)
...
Google last month launched Google.cn, a version of its No.
1 search engine that prevents Chinese residents from seeing, for example, photos
of tanks confronting Tiananmen Square protesters in 1989. Also last month,
Microsoft acknowledged shutting down a blog run by a Chinese journalist critical
of the government.
Last fall, Yahoo acknowledged giving information to Chinese
officials that led to a 10-year prison sentence for a journalist accused of
divulging state secrets. Last week, Reporters Without Borders, a journalism
group critical of Yahoo's cooperation with Chinese officials, accused it of
working with the Chinese government in another case that led to a dissident
being jailed. Yahoo said it was unaware of the case.
The companies say they are unhappy with the restrictions
yet must honor local laws.
...
Google's site launch came days after it rebuffed a U.S.
Justice Department subpoena demanding that it turn over data on how millions of
users search the Internet.
In contrast, Yahoo, Microsoft and America Online all
cooperated with Justice.
Since this affects my day job I won't comment on it other than to
say I find this entire debate very interesting. I will mention that
unlike the USA Today reporter who wrote this story I'm not sure that
the U.S. government's interest in the IBM/Lenovo or Unocal/CNOOC deals last year is comparable to the current efforts by members of congress.