UPDATE 1-Google says China has renewed web page licence

Fri Jul 9, 2010 7:01am EDT

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SHANGHAI, July 9 (Reuters) - Google Inc (GOOG.O) said on Friday that the Chinese authorities had renewed its licence to operate a website, averting a potential shutdown of its flagship search page in the world's biggest Internet market.

Google said last week that it would stop automatically rerouting users to its uncensored Hong Kong-based search page, explaining that Beijing had indicated it would not renew its Internet Content Provider licence if it continued to do so.

That had prompted speculation that China might use the opportunity to shut down Google's China search page, in what would have been a blow to its other business in the country.

"China has renewed our licence," a Google spokeswoman told Reuters. "We are very pleased that the government has renewed our ICP licence and we look forward to continuing to provide web search and local products to our users in China."

Google stunned markets and consumers in January when it warned it might quit the country, saying it would not provide the censored search results that China requires.

In March, Google began to redirect visitors to its China website to a search site in Hong Kong that provided uncensored results. [ID:nSGE60C01H] [ID:nLDE66603E]

But it stopped automatically rerouting users last week, in what analysts saw as a softening of its stance and a willingness to compromise to maintain a foothold in the world's biggest Internet market by users.

Google Chief Executive Eric Schmidt had expressed confidence about securing the licence on Thursday. [ID:nN08260404] (Reporting by Melanie Lee; Writing by Jason Subler; Editing by Jacqueline Wong)