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Google says growth in China hinges on midsize firms+
(Japan Economic Newswire Via Thomson Dialog NewsEdge)NANJING, China, March 17_(Kyodo) _ Internet giant Google said Friday that the development of its search engine in China hinges on millions more midsized Chinese companies starting up websites.
About 10 percent of Chinese companies have websites, a prerequisite to being picked up by search engines, said Johnny Chou, Google's head of sales and business development in greater China.
Chou, who spoke at the Search Engine Strategies Conference and Expo in Nanjing, noted that Google is growing a service to send information on companies from China and elsewhere to specific user groups in 100 countries and 100 languages.
Google also sells online ads, revenue for which is growing in China as the number of Chinese Internet users, now about 111 million, increases.
"Most companies have no web coverage, so (we need to) go out and educate companies to help them realize the value of being seen online," Chou told an international audience of about 600 search engine industry professionals at the conference opening speech.
California-based Google lags behind Beijing-based Baidu.com Inc., which is China's most popular search engine because of its speed and coverage of local businesses, a plus for common Chinese consumers.
Baidu has close to half of the search engine share in China, depending on the city, and Google is second with 28 percent to 38 percent. Google is popular with Chinese students and office workers because of its speed and index of 4.3 billion Internet sites.
Third-place Yahoo China, a tie-up with China-based Alibaba.com, may also take on Google by somehow combining the Yahoo search engine with Alibaba's experience in e-commerce, analysts at the conference said.
Alibaba.com founder Ma Yun, also in charge of Yahoo China, said in a conference speech that he wanted to rival foreign-owned search engines in the Chinese market within five to 10 years.
Acting fast is critical, Chou said.
"The search engine market has just gotten started. To the early bird is going to have great opportunities," he said.
Chou might have been hinting in his speech that Google plans to build basic company websites for free as a loss leader to get more business later for its targeted search audiences and possibly more e-commerce, said Bill Hunt, president of the U.S. consultancy Global Strategies International.
"The missing element is the website," Hunt said. "Maybe a new service that comes out here is the 'Google website.'"
Companies afraid of being bypassed by competitors that do show up in online searches should welcome chances to build high-profile websites, Hunt said.
Some professionals in the audience, many of whom came to sniff out business deals or study the climate for launching Internet-related companies, said they were disappointed that Chou did not let on more details.
"Google didn't give us any information so far," said Clement Chung, a Hong Kong web programmer who came to the conference to see about starting a business to retool websites so they get seen more in search results.
"He has this idea (about working more with Chinese companies), I think. But he didn't say how he could do it," Chung.
Google, which was shut down in China for two weeks in 2002 for not screening out antigovernment search results, took its first China steps in June 2004 with the launch of Chinese-English translation, Chinese weather reports and people-tracking services. A week earlier Google had bought a minority share of Baidu, and a month later it said it would offer search engine expertise to Netease, one of China's top 10 Internet portals.
In September 2005, Google announced it would open the Google China R&D Center to study what Chinese users wanted. Study topics might include China satellite maps and free e-mail services, an IT industry analyst said at the time.
Google cannot rest on its current fame in China, said Chris Sherman, a conference moderator and executive editor of the Net-based news service Search Engine Watch.
"Google is so big now, so game over?" Sherman said. "I don't believe that."
The Internet Society of China, a trade group with government backing, joined conference organizers Isas.cn of China and Incisive Media of Britain to hold the Nanjing search engine event Friday and Saturday.
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