According to Reuters, Gates said about China:
"You've got to decide: Do you want to obey the laws of the countries you're in, or not? If not, you may not end up doing business there."He's wrong. The Great Firewall of China is not "very limited;" if it were limited the Chinese government would not bother to spend the amount of time and money it does enforcing Internet censorship. It's true that there are ways to attempt to circumvent it, such as anonymous proxy servers. But the vast majority of people in China have no idea how to do that. Chinese Internet censorship is not limited at all.
"The Chinese efforts to censor the Internet have been very limited. It's easy to go around it, and so I think keeping the Internet thriving there is very important."
As for obeying the laws of the countries you're in, that's clearly a swipe at Google. And Google knows full well that it may not end up operating in China. Kudos to Google for taking such a principled stand against censorship.
It's also somewhat ironic that Gates is telling Google that you need to obey the laws of the country you operate in, given Microsoft's history of prosecution in the U.S. and record fines by the European Union for violating anti-trust and monopoly laws.