The announcement that Google is exiting the Chinese mainland is unprecedented as a rebuff by a private firm on the Chinese government. As of March 22nd, Google announced it would be shutting down its search service in opposition to government mandated censorship and hacker attacks speculated to have been directed by the Chinese government. Google search now redirects traffic to its operations in Hong Kong, but even such searches are subject to pervasive government firewalls.

Looking through the frame of broader China-U.S. relations, many pundits are hailing Google’s actions as a rebuke of government policies and a defense of the freedom of information, but as a private firm, its priorities fundamentally derive from money. While its withdrawal surely reflects an ethical conscience at the center of Google’s corporate culture, its primary motive is first and foremost influenced by the dim commercial prospects offered by an increasingly adverse business climate in China.

Multi-national firms like Google and Chinese consumers alike see opportunity in the boom, but no one is benefiting more than Chinese corporations; many of which are former vestiges of the state. In this particular conflict, the big winners are Google's domestic equivalents in China such as Baidu.com which now has the opportunity to extend its current 63 percent market share into Google’s former 33 percent market share.

As many of the domestic firms lack the flexibility to perform outside of China and will be operating in a Google-free market, the technology sector may lack the proper competition that encourages innovation.

With its exit, Google loses the opportunity to monetize the traffic of approximately 400 million web-users, but this move shouldn’t diminish its dominating momentum in the American and global markets. Google will still maintain its research and development initiatives in China, but the outcome of these efforts will no longer benefit the Chinese commercial market directly.

Perhaps it isn't Google's place to advocate personal freedoms, however Google's exit assures the economic prosperity of a new oligopoly of Chinese firms that mirror to hard-line government policies As China continues to coddle domestic firms that hope to compete in global markets, it compromises its soft-power and economic trade interests. Beijing should take a hard look at where its politics are threatening China’s economic integrity.