Why would the "Chinese government" carry out pervasive domestic censorship? They know information is still going to get around on back channels. That was never the point.

The potential gain is that they can extend this capability (and chilling effect) to GitHub and other sites that aren't under the sovereign control of China. Nobody wants to go out of business just because a user uploaded a file which is politically controversial in China. Now every company will think twice and come up with some weaselly reason why they can't have text files about Falun Gong or whatever.