Google Inc announced yesterday it had made a deal with China Mobile Ltd to enter the nation's emerging mobile search market.
Under the agreement, Google will integrate its search engine into China Mobile's "monternet" mobile platform providing a package of services including news, ringtones, wallpaper, videos and games.
"Our cooperation with China Mobile will help achieve Google's mission of making information available anytime, anywhere," said Lee Kai-fu, Google's vice-president, at a press briefing in Beijing.
In China, Google is a distant second in search behind market leader Baidu.com, whose market share is three times larger than Google's.
China Mobile, having slashed its charges in recent years, is desperate to find new sources for income outside its traditional services.
Although Google declined to disclose any details of the deal, Lee said its cooperation with China Mobile was just the beginning.
"From Google's earlier experience in the global market, our next step in cooperating with telecom carriers usually focuses on making possible the traditional Internet search services on common mobile phones."
Google has previously formed partnerships with numerous telecom carriers such as Vodafone in Europe, KDDI in Japan, Bharti Airtel in India and Sprint in the United States.
Last month, the company signed an agreement with Chunghwa Telecom Co Ltd, the largest telecom carrier in Taiwan Province, to provide a search engine on its "emome" mobile platform.
"China has great potential for mobile search since there are far more cell phone users than Internet users in the country," said Zhang Dongming, research director of BDA China.
According to government figures, China possessed 123 million Internet users at the end of last June, up from 111 million in 2005. However, the country's mobile phone users dwarf these figures surpassing 462 million last year, creating a huge pool of consumers that few Internet companies could afford to lose.
Last November, Microsoft agreed to provide its Live Search services to China Telecom. Baidu, Google's biggest rival in China, also signed deals last year with Nokia and Haier to offer Baidu's mobile search products on several Chinese cell phone models. Other Chinese search engines such as Cgogo, iAsk and sogou are also offering mobile search services.
"I think mobile search may have the same importance as Internet search in the future due to its unique mobility and the relatively low cost of facilities," said Lee, noting that the true potential of the mobile search market may be undervalued by many analysts.
According to domestic firm CCID Consulting, the revenue of China's mobile search market should top 173 million yuan in 2006, an increase of 642.3 percent year-on-year. The firm estimated that this figure would soar to 758 million yuan by 2008.
Another consulting firm, iResearch, is even more bullish in its predictions. It said that the revenue of China's mobile search market would surpass 1.35 billion yuan in 2008 and 3.1 billion in 2010.
On Thursday, Xunlei, a Shenzhen-based peer-to-peer file sharing network operator, said Google Inc. will buy a stake in the company but declined to reveal the details of the deal. Google is reportedly partnering with Ceyuan Ventures, a Shanghai-based venture capital firm for the investment.
(China Daily January 5, 2007)