The Other Google War

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While we've all been preoccupied with Google's (GOOG) battles with Apple (AAPL) or Microsoft (MSFT) or a few overzealous Italian prosecutors, we've somehow forgotten the company's other little skirmish. You know, the one with the largest nuclear-powered totalitarian state in the world.

But the Obama administration hasn't forgotten. And last evening, Bloomberg reported that the U.S. Trade Representative's office is considering bringing the dispute, in which Google discovered cyberattacks originating from China and vowed to stop censoring all search results in the country, before the World Trade Organization.

Google lawyer Nicole Wong publicly applauded the idea, and two industry groups with Google ties, the Computer & Communications Industry Association and the First Amendment Coalition, have formally complained to the trade office as well. But such a move would undoubtedly escalate tensions between the two countries, especially now that China has taken a more belligerent stand on arms sales to Taiwan and the Obama administration's recognition of the Dalai Lama as a diplomatic figure.

Interestingly, the Financial Times thought this could be a terrible idea, mainly because the United States might not have a case:

Escalation to the WTO could be both bloody-minded and counter-productive. Any case based on discrimination would be unlikely to succeed, given that Chinese firms are typically subject to more rigorous control than non-Chinese. Besides, during a copyright action brought by the US against China that culminated last year, the WTO confirmed that censorship violated none of its rules. A similar verdict here would entrench China's regime, rather than threaten it.

Nonetheless, this latest threat underscores how fraught Sino-American relations are, and how aggressive Obama is willing to be in the Far East.