The move, announced by Google on Friday, removes another thorn in U.S.-China relations and reflects Beijing’s desire to be seen as friendly to major foreign companies in spite of ideological differences, analysts said.

But analysts said Google’s position in China remained fragile and that the country likely would account for a fraction of Google’s revenue for some time.

Google said on Friday that China had renewed its webpage license, which means it can continue to run the Chinese language search site google.cn.

Last week, Google offered Beijing a face-saving compromise: it stopped automatically rerouting google.cn to its uncensored Hong Kong site. Now, visitors to google.cn must click once to go to the Hong Kong page.

Analysts said Beijing had sent a reassuring signal to foreign businesses that it would play by its own rules while keeping an innovative global company such as Google in its domestic market, where Chinese companies can compete with and learn from it.

Analysts estimate Google’s revenue in China at $300 million to $600 million out of its $24 billion annual revenue. It has around a 30 percent share of China’s 7 billion yuan ($1 billion) search market, which local rival Baidu Inc dominates.

Source : Konaxis