After a long morning of travel and SXSW preperation, WebProNews popped in on an interesting talk from writer and tech watcher, Kaiser Kuo (here’s his bio) about what might happen with the whole Google/China situation, which has essentially remained at a stand-still for the past two months, since Google made its famous announcement about a "new approach to China."

Kuo said right out that he doesn’t have the "inside dope" about what’s happening within Google, but he did give a fascinating history of Google’s efforts in China, as well as a look at some possible scenarios that could play out. Some he listed specifically, include:

Worst Case Scenarios

– Blow up: Google decamps in atmosphere of acrimony
– Google.com blocked, possibly even Gmail, Gtalk, Google Docs, Buzz, etc.
– All google products exit from China (partnerships with mobile companies end)

Moderate (and according to Kuo, most likely) Scenarios

– Google.cn shuttered
– Google.com, Gmail, Google Docs, etc. unblocked
– Google research and development and sales continue to operate in China
– Google continues mobile partnerships

Best Case (and not very likely, but not entirely far-fetched) Scenario

– Google.cn stops censoring and still stays in china
– Pigs fly over a frozen hell scape

The session was not without a sense of humor, but that’s not to say Kuo doesn’t take the situation very seriously. In fact, he appears to be putting much more time into looking at the big picture than anyone I’ve seen (at least those outside of Google itself and the Chinese government).

Perhaps the most interesting part of Kuo’s talk was about how  the wetern media’s attention focuses more on one of two kinds of censorship going on – the "Great Firewall" censorship, where many sites are blocked at the ISP level. He says it’s fairly simple for Chinese Internet users to "hop" the Great Firewall through proxies and VPNs. The other kind of censorship going on in China, according to Kuo, is the kind that really matters. This is "self discipline", which is carried out by Internet companies themselves.

If companies don’t follow through with this kind of censorship, they face the risk of being shut down, having servers seized, etc. Some have been shut down permanently in the past, and others have been shut down long enough that they lost most of their users anway.

"Sad story indeed," Kuo calls it.

As far as the Google situation, "Google is going to have to shit or get off the pot," says Kuo. "The ball is very much in Google’s court right now." Bejing realizes it has nothing to gain by pushing Google on the issue or being openly hostile towards the company, he says.

This week, Chinese Minister of Industry and Information Technology Li Yizhong reportedly had this to say: "I hope that Google will abide and respect the Chinese government’s laws and regulations. But, if you betray Chinese laws and regulations, it means that you are unfriendly, irresponsible, and you will have to pay the consequences." He also said, "What needs to be shut down will be shut down, what needs to be blocked will be blocked."

Kuo says this is just more of the same stuff we’ve been hearing from China for the last 2 months.

Google CEO Eric Schmidt recently said, "Something will happen soon." Days ago, Google gave a congressional testimony saying they still intend to stop censoring results, but as Kuo notes, shutting down Google.cn would be a very involved process with large logistical challenges.

Update: The Financial Times is reporting:

Google has drawn up detailed plans for the closure of its Chinese search engine and is now “99.9 per cent” certain to go ahead as talks over censorship with the Chinese authorities have reached an apparent impasse, according to a person familiar with the company’s thinking.

Stay tuned to WebProNews.com for more SXSW Interactive coverage as the event continues into next week. Watch for live streaming interviews with industry professionals at live.dev.webpronews.com.