Some might wonder how is it possible that Google still commands about 15-20% search market share in China despite its google.cn service essentially shut down there. The reason is because many Chinese netizens, 450 million and growing, are still using google.com for English language searches. Actually, according to Analysys International, a Beijing market research firm, Google enjoys 19.2% in revenue share in China versus Baidu’s 75.8%. For this reason, Baidu and Microsoft have just announced combining efforts to take on Google on that market segment.
I have expected this type of deal to come up in the past. It is both a smart and a practical move on Baidu’s part. The competitive advantage is that all of Chinese users would simply use a single Baidu service now. They need not think about Google.com. Bing simply handles English language materials as if Baidu is suddenly much better at serving them up.
With all the hype in the Western press about censorship in China, people automatically assume the Chinese are being blocked from foreign knowledge and ideas. Well, if we grossly view Google as a map of knowledge and ideas in the English language and Baidu in the Chinese language, we can consider how actively the Chinese are questing knowledge in English versus Americans in Chinese.
We know 19.2% of search revenue goes to Google from Chinese users. That is a tremendously large volume of searches.
Do you know of Americans actively using Baidu and searching in Chinese? I tried looking for statistics on that and found nothing. Baidu’s market share in the U.S. is virtually non-existent.
The illustration below is really my attempt at highlighting this gap – between knowledge flow in the English and Chinese language domains to China and U.S. respectively. The sizes of the arrows are based on an idea in that gap – not sized based on anything scientific.
In practice, I would say, the Americans are self-censored. Western media bias and ‘propaganda’ is a frequent topic on this blog. I’d add that the Western narrative about Internet censorship in China is wrong-headed.
Whereto for Google? In my mind, search is such an important ‘portal’ for every society, and I don’t see Google being dominant outside the U.S. in the long run, despite the company being so dominant today.
As in the case with China, it has ideological differences where the company even dares to not comply with local laws. I expect Google to have similar run-in’s with other countries in the future where it gets booted outright.
Indigenous search engines will in the long run increasingly have search results and ranks the domestic audience want. I can’t imagine Google investing and sustaining the same resource and (more importantly) goodwill in getting the results ‘right’ for foreign societies. Google is already a willing participant in the “free Internet” foreign policy of the U.S. government. I have a feeling the company had already concluded it needs Uncle Sam’s help in order to maintain their grip in foreign markets around the time when Google publicly threatened to not comply with Chinese censorship laws.
The Microsoft-Baidu alliance and continuing decline of Google’s search market share in China will be a trend to watch.