I first commented on Google modification of its policies to gain access to the China market almost four years ago. No, it seems Google may reverse course and back away from special concessions. The percipitating factor appears to be a cyber attack on Google computers intended to gain access to the mail accounts of human rights activists (NY Times). It appears Google feels used. Limiting access to content perceived as damaging to the government was one thing. Google agreed to this. Now, it appears Google feels that it has been used to jeopardize individuals who made good faith use of Google services.
It appears that Google has made some changes. Searching Google.cn no shows images that were previously blocked. I remember being in China and searching for information about Tiananmen Square and I know this access has been changed.
BTW – how the source of an attack is identified is interesting. This Ars Technica post discusses why the Chinese government was implicated.
