Google Losing Ground in Chinese Search

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Note: Some links were removed from this post because they are no longer valid.

This is a slight sidetrack from DEMO China write ups, but something I think is important to understand about the Chinese tech space. One of the things I asked people in China throughout my visit was what search engine they use to find information. Almost everyone named Baidu as their choice. As someone who can't live without Google here in the U.S., I was somewhat surprised, especially following the huge deal made about Google's entrance into China with Google.cn earlier this year. Apparently my unscientific sample of a population of English-speaking native Chinese tracks fairly closely with two recent studies on the topic.

Red Herring is reporting on China IntelliConsulting's findings that Baidu now makes up 65.4% of searches in Beijing, while Google is now about 20.6% of searches in the sample group. This represents a 13% increase for Baidu and a 12.3% drop for Google. CNNIC offers similar statistics for their recent survey. The chart below is combined data for Beijing, Shanghai and Guangzhou. Baidu is showing 62.1% of the CNNIC sample and Google is at 25.3%. While the CNNIC sample suggests a slightly smaller drop in Google's percentage of the Chinese market, the trend is still downward.

While people here in the U.S. were very critical of Google locating servers inside China and making claims about Google and others being bad world citizens by supporting the Chinese government in censoring some information from the people of China, the people I spoke to in China have a very different view. The concern isn't about government involvement. As one person put it, being number one in Chinese search means always recognizing that the Chinese Government is number one.
Among people I spoke with from the tech community, the prevailing opinion is that Google isn't taking China seriously. By dictating business decisions about China from Mountain View, CA in the U.S., the opinions feel that Google isn't making an effort to understand the Chinese search market. By failing to keep servers in China, companies like Google couldn't ever successfully compete against companies who do business in China. Until management in the China division of the company is given decision making authority over the direction of the company. More importantly for the search equation, everyone I spoke to felt like they got better results when searching with Baidu.

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