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Google’s move into China four years ago was billed by some people as a battle between the irresistible force and the immovable object.

The inexorable expansion of the web – epitomised by Google – would by no means exist happily in a command economy like China, said critics.

On Monday, nevertheless, Google pulled its search facility out of mainland China, redirecting users to an uncensored site in Hong Kong.

What now for both profits and reputation? Has it shut the door on the world’s greatest web marketplace?

The Wonderful Firewall

China has hit back at Google, limiting its citizens’ use of the search facility through web filters that are collectively recognized as the Wonderful Firewall.

And some of Google’s company partners are already beginning to distance themselves from the company.

On Wednesday China’s second-largest mobile operator, Unicom, announced that it would drop Google’s search function from two new handsets that are being developed.

Official Chinese figures put the number of web users at 384 million. But the number of mobile subscribers – people who do or will eventually – use the web on their handsets is 745 million.

At Sina Corp, which owns a portal featuring a Google search bar on its primary page, executives are thinking about the future of link with the US giant.

And there are a number of other news reports from China about how Google’s partners and advertisers are reviewing their relationships with the web giant.

These moves underline the feasible impact on Google’s company.

On the face of it, picking a fight with the rulers of what is soon to be the world’s greatest economy looks like commercial stupidity.

Today’s company mantra says that any company which wants to be global has to do company with China.

And yet, there is a growing consensus among analysts that Google’s move will have only limited impact on its company.

Google’s share price had fallen about 6% since the company announced on 12 January that it was thinking about a withdrawal from China.

But since Monday, when the final choice was made, the shares have been rising.

Don’t Be Evil

Google, whose motto Don’t Be Evil was tarnished by the move to China, has won plaudits in the blogosphere and among the commentariat for its choice to withdraw.

The company has stood up for totally free speech and unfettered enterprise, they say.

These are fine words, says technologies analyst Graham Titterington, but in reality they are just “fluff”.

“Google has taken a tough-headed company choice,” he said.

Mr Titterington, principal analyst at Ovum, said: “Google has looked at the advantages and damage to its company, and made a choice on regardless of whether the move will do much more harm than fantastic.”

In the immediate term, Mr Titterington does not expect a lot damage because China remains a little component of the company’s operations. “Indeed, outside China there will be some kudos and advantages to company and its brand image,” he said.

China’s total web advertising marketplace was worth about $1bn last year, with Google’s revenues from the country amounting to about $250m-$300m.

This revenue figure represents about 1% to 2% of Google’s total, estimates Youssef Squali, analyst at Jefferies & Co.

Prior to Google moved to the mainland, it had perhaps 13% of the China search marketplace. Going “onshore” took marketplace share to about 20%. Even if Google’s share returns to 13% or less, it is by no indicates critical for the company.

“Exting China wouldnot be too damaging for Google since the company is the marketplace share leader in most non-domestic markets, where search usage and monetisation opportunities still abound,” Mr Squali said.

Besides, Google was already struggling to consolidate and grow in China. For numerous analysts Beijing clearly backed Baidu as the home-grown web marketplace leader.

Censorship

Google also faced subtle – and not so subtle – attempts to restrict growth, and was already the subject of attacks from officials over alleged failure to comply with censorship rules.

It is likely that Google saw the writing on the wall a lengthy time ago.

But, surely, losing a position in the world’s single greatest constituency of web users ought to be a retrograde step? After all, by 2014 the Chinese marketplace for web advertising could grow to as a lot as $20bn, according to estimates.

Mr Titterington agrees: “In the longer term, Google requirements China much more than China requirements Google.”

But he does not think Google will remain outside China forever. In fact, he believes the company could be operating within the country once more within 3 years.

“China is opening, and in time they [the leaders] will change and react,” he said.

Google may have anticipated China would relax its rigid control on society sooner than it has done. But eventually it will happen.

“Politicians have to live with short memories. At some stage they [Google and Beijing] will start co-operating once more,” Mr Titterington said.

“The big question, though, will be how a lot momentum Google will have lost in the meantime.” Will the growth of indigenous operators like Baidu successfully marginalise Google, making a return to China irrelevant?

Not everyone is so optimistic that Google will make a quick return. David Wolf, president of technologies marketing consultancy Wolf Group, says it will take years for Google to rebuild partnerships in China.

“Trust me, [Google] aren’t walking away from this unhurt,” he told the Associated Press news agency.

Nor does the rhetoric coming from Beijing bode well for an early rehabilitation.

The Beijing government called Google’s withdrawal “totally wrong”, although the People’s Daily newspaper was even much more strident.

The paper said Google was component of an web war being orchestrated by the US intelligence services.

Herein lies a danger. What is presently a dispute over company, risks becoming a dispute over politics – which would make it far much more challenging for relations to heal.