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By Owen Fletcher on IDG News Service, 3 September 2009 http://www.idg.com
Google and Chinese search engine Baidu are racing to dominate China's growing mobile search market, taking their rivalry beyond Web search.
Google and Baidu together account for as much as 95 percent of Web searches done in China, with Baidu alone holding about two-thirds of the market, according to local consultancies. The companies have fought to take slices of market share from each other with competing services such as free music download portals, and both are now looking to China's growing masses of mobile phone users to expand further.
The Pursuit of a Standardized Solution for Secure Enterprise RBAC: Download now "They're putting things in place to dominate the market," said Bruno Bensaid, managing director of Shanghaivest Limited and founder of Mobile Monday Shanghai.
China surpassed 700 million mobile subscribers in July and a rising number are surfing the Internet by phone as China's carriers roll out 3G services.
A Baidu statement last month called the mobile Internet "a new strategic focus," and Google China has said its next goal is to make mobile search surpass its PC-based Web search service. Both have sought deals with local carriers as part of their efforts. Baidu search and offerings like its message forum are embedded in a value-added service platform run by China Telecom, one of China's three mobile carriers. Baidu is also "in the process of partnering" with carrier China Unicom, a representative said. Google, meanwhile, gives search support for a music and application platform run by China Mobile, which boasts more subscribers than any other carrier in the world.
"Especially in the early stage in a developing market, it’s important to have support from an infrastructure player," said Alvin Wang Graylin, CEO of mInfo, a Chinese mobile search provider.
Over 270 million Web searches were performed on mobile phones in China in the second quarter, more than double the figure from a year earlier, according to Chinese research outfit Analysys International. Google took 26.6 percent of those searches, a slight lead over 26 percent for Baidu, Analysys said. Those numbers placed Baidu and Google a level above other mobile search providers. The next-biggest provider, 3GYY, took 13.5 percent of the searches, Analysys said.
Baidu and Google are likely to take more of the mobile search market as it grows in the next one or two years, but smaller players may gain more in the mobile realm than they have in Web search, said Bensaid.
Google and Baidu lack popular mobile application suites, leaving an opening for companies that do offer them and could expand their functions to cover search, Bensaid said. Entertainment-focused application suites for mobile phones, such as one from local portal Tencent based on its hit chat client QQ, have millions of users in China, he said.
Smaller players may also compete by working with manufacturers to embed their search on "shanzhai" handsets, something Google and Baidu are unlikely to do, Bensaid said.
"Shanzhai," or "bandit" phones, are produced and sold without government licenses in China. The phones, sometimes look-alike versions of famous handsets like the iPhone, are hugely popular due to their low prices.