Yahoo Settles China Suit

Details here — this on the claims filed by the families of Chinese dissidents jailed on evidence coughed up by Yahoo to Chinese authorities. The settlement terms weren’t disclosed, but Yahoo CEO Jerry Yang issued an apology to the families and money is changing hands.

The issues posed here aren’t going to go away (and Yahoo isn’t the only one with problems), in what may be a defining episode of the new era. On the one hand, China promises so huge a market that the internet companies can’t turn their backs to it, and the government still has the capacity to maintain control of the internet (this a featured example in Jack Goldsmith and Tim Wu’s book on why the internet really doesn’t change anything). On the other, human rights NGOs and consumers in turn will ratchet up the pressure, and playing this kind of ball with a repressive government is antithetical to Silicon Valley’s self-image. Congress played a facilitating role here, beating up on Yahoo with hearings last week, but my bet is that proposed direct regulation will go nowhere. In the long run, I think human rights interests will carry the day, but this is a much closer case than its analogues.