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Google won a small victory today by having its license to operate in China renewed, stalling a shutdown of the site for now. But it still appears to be losing the war.

Google made a small change last week that allowed the company to stand by its principles of not censoring its results while following domestic law. Instead of automatically rerouting users from Google China search to the unfiltered Hong Kong version of search as it had done before, it put up a landing page that visitors have to click before heading to uncensored results.

Google’s problems in China erupted in January, when it warned that it might leave the country after four years of complying with local law to censor results. The trigger was a hacking attempt into the accounts of human rights activists that appeared to be government-linked.

Despite today’s license renewal, the company’s position in the country is still tenuous. Many of its more popular services, including YouTube, Blogger and Picasa, are fully blocked. It also has a powerful, homegrown and government-favored rival in Baidu. The Chinese market also only contributes a tiny bit of the company’s overall revenue at an estimated $300 – 600 million per year, according to Reuters.

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