Google’s China odyssey
- Source: The Global Times
- [14:01 June 08 2009]
- Comments
By Sherman So and J. Christopher Westland
From shaky ground to a fighting chance
Last week, we talked about how Baidu emerged as the dominant search engine in China. In this chapter, we will talk about its chief competitor, Google, the world champion in search engines.
Despite a high profile debut in the media when it first opened its office in mid-2005, Google China was on shaky ground in its early days.
A year after setting up its office in China, its market share had actually dropped, bottoming out at around 16 percent in mid-2006, from 23 percent a year earlier. Meanwhile, Baidu, with its post-IPO momentum, had increased its share to 50 percent from 37 percent in the same period, according to Beijing based researcher Analysys.
Baidu even promoted itself by running commercials on Chinese TV ridiculing the quality of Google’s Chinese search engine. By the end of 2006, some local media already anticipated the day when Google would exit China, just as eBay, another supposed US world leader, already had.
Google China’s problems stemmed from its small number of staff at the start, and soon found itself facing a host of unforeseeable obstacles.
“I was a general without an army,” recalled Lee Kai-fu, Google China’s president. Although the first employee he hired was a developer, he did not actually start working until January 2006.
As Lee recalls, much of Google China’s first year in 2005 was spent on preparation: getting licenses, signing deals with partners, recruitment and market research.
The real work started in 2006. “The first thing we did was to improve the Chinese search engine,” said Lee.
Google’s search engine was designed to support multiple languages. At the time of its IPO in 2004, it supported at least 97 of them, including Chinese. However, the Chinese language presents its own peculiar difficulties and Baidu was initially better at Chinese-language search than Google was. But by 2006-2007, most analysts agreed that Google’s Chinese search results were at least as good as Baidu’s.
“In 2007, we started two major non-search development programs: mobile search and maps,” said Lee.
After Google CEO Eric Schmidt visited China in April 2007 to show his support for the China team, things started to improve. By mid-2007, Google’s market share had rebounded to 23 percent, according to Analysys.