Google is calling China's bluff. The online search giant has announced that it is “no longer willing” to censor results on its Chinese site. It will now talk with the Beijing government about the basis on which it would be possible to run “an unfiltered search engine within the law, if at all”. This is a bold stand, and could well lead to Google being barred from an important emerging marketplace

China is still a poor country, but multinational companies want to establish themselves in a market of 1.3bn increasingly prosperous people. The authoritarian rulers of this continental economy have, until now, been able to force news, media, online search and software companies to comply with their onerous censorship requirements.

Microsoft and Yahoo both run local search sites that conform to these rules. Since 2006, so has Google, although in a form that gives users more details about when information is being kept from them. The decision to go along with the restrictions has been the subject of fierce debate, not least within Google itself.

The sceptics included Sergey Brin, one of the company's founders. They fretted that complying with China's laws directly breached the company's mission: “to organise the world's information and make it universally accessible and useful”. Collaboration with the censors, moreover, was the main factor that drew clouds over Google's sunny image.

So, today, Google looks cool again. But this posture is not a PR stunt. If it were, it would be an extraordinarily high-risk one. Its presence in a country that already has more than 300m of its people online is at stake. Rather, Google is reacting to a calculating Chinese state that will brook no challenge to its control of propaganda.

Last year the unrest in Urumqi and the anniversary of the Tiananmen Square massacre both provoked frenzied crackdowns. Facebook and Twitter have already been blocked. Control-obsessed officials have suppressed even childish satire and jokes. In addition, Google recently uncovered attacks on its e-mail service from within China. These incidents changed the balance of opinions within the company, leading to this week's decision.

If Google follows through on its statement, even if it is forced out of China, its stand will still matter. In future the Chinese will have more difficulty snuffing out free expression. Google is the first major company to steadfastly refuse China's demands for control. Let us hope it is not the last.