To start with this article is published in English. They know that 99% of their population will not be able to read it so its no big deal. I have seen articles in Shanghai daily which give minor criticism to the government. But overall they always try to project a good sentiment about the country. Furthermore often what is published in English print written by Chinese is not the same as what is written in Chinese print. Language is ultimately their greatest tool for censorship.
Also, 90% of the population remains unaffected by their blockages since they can't understand what the rest of the internet is saying. If you were to try to access youku (Chinese website akin to youtube) within china you would find that the streaming speeds put youtube to shame. So for the average person why would they be interested in youtube?
As long as the government provides people with basic infrastructure and safety people are willing to put up with some amount of censorship.
"They know that 99% of their population will not be able to read it". But in my experience in China at summer programs in universities, I found that almost all university students (at least in Beijing & Shanghai) can read English. I suppose they will of course prefer to read Hànzì.
In other words: Encourage a little bit of criticism, and you will be able to observe those who join in - even if they don't go too far - and be able to obtain a handy register of people to pay extra close attention to.
Nobody is talking about a revolution, that would be suicide. The intelligentsia are far more concerned with using government to their advantage, which naturally responds very well to money exchanged for favors (like how baidu got rid of Google).
It's poor people that government worries about. Because when poor people rise up, that's bad news for anyone in power who hasn't yet fled the country. And if most poor people don't read English, well then there is not much harm in allowing some printed criticism of the Party, as long as it's in English.
This created a safe pool where new local companies could grow before they were able to face international competition. These companies could incubate and then burst onto the international stage.
I wonder if this is an electronic version of, e.g. what Korea does with its automobile industry using taxes...
The gap is that Chinese online companies don't seem to be exporting much as yet. In the case of chat at least, I think it is actually being held back by GFW because you need a chinese phone line to register.