Google vs. Baidu is the heavyweight battle of the Chinese Internet market. And a lot of media coverage is being devoted to analyzing this fight. Based on what's out there now, Baidu has won round one. The question now is whether Google on the ropes or simply pacing itself...
The New York Times posted a good article Sunday on Baidu's emergence as China's leading search engine -- despite the expensive efforts of Google and Yahoo!.
Here are some key excerpts...
In addition, analysts say, entrepreneurs in China have a knack for pummeling American Internet giants. “The globally dominant U.S. Internet companies have failed to take the No. 1 market share position in any category,” says Jason D. Brueschke, a Citigroup analyst, of the Chinese market. “And they came with more money and major brand names. And so there’s something fundamentally different about this market.”
So fundamentally different, Mr. Brueschke believes, that Baidu will retain its hammerlock on the Chinese search industry. “The real battle in the competitive landscape is not about who’s No. 1, it’s about who’s going to be No. 2,” he says.
I was surprised to find in the article that Baidu began using pay-per-click adwords before Google -- something I had assumed Google pioneered. However, Baidu clearly did coopt Google's famously spare design:
So why is Baidu dominating the search market in China? According to the article...
Analysts say Baidu is playing to a different audience than Western Internet companies because the Chinese are far more interested in entertainment than news, books or car rental rates. “The fact is 70 percent of China’s Internet users are under the age of 30,” says Richard Ji, an analyst with Morgan Stanley. “Most of them are single, only children. They’re looking for entertainment.”
That may explain why China’s dominant Internet companies are all entertainment focused, like Tencent (which hosts online communities and instant messaging) and Netease and Shanda (which are online gaming sites).
The article concludes on a positive note for Google and a "challenges still remain for Baidu." Google has been more successful at generating revenues than Baidu.
But The Red Herring paints a much darker picture of Google's prospects in China, saying:
The Mountain View, California-based Google has lost significant share in the three largest Chinese markets of Beijing, Shanghai, and Guangzhou, while Beijing-based Baidu has gained substantial ground and a commanding market share lead.
In Beijing, the only city for which detailed results were made available, Baidu’s market share rose by 13 percent from one year ago to 65.4 percent, the survey showed. Google fell by 12.3 percent, from 32.9 percent to 20.6 percent.
And the article proposes its reason for Google's declining market share...
Questions on overall satisfaction with major search providers revealed that users in China are “unhappy about the speed of Google,” said Mr. Lü, and with penalty time-outs that Chinese ISPs impose on users when they search for sensitive search terms.
These issues prompted Google to launch a China-hosted version of its site at Google.cn, drawing fire from free speech advocates and members of the U.S. Congress. But according to Mr. Lü, “only about 3 percent of Google users in China are using the Google.cn website. Most are using Google.com,” he said, referring to the U.S.-hosted, uncensored version.
China imposes tight restrictions on bandwidth for traffic entering the country, which means that any Web site hosted outside of China is going to load more slowly than sites hosted within China. It's another way to control content and force companies to invest in the market. But I find it interesting that the Chinese version of Google.com is holding its own against Google.cn.
My theory on Baidu's success?
I think that both articles are correct, but I also think nationalism is playing into Baidu's success. The Chinese may covet German cars and French fashions but they are also loyal to home-grown success stories -- and Baidu is the poster child.
That said, Google took over the world in about six years -- there is still plenty of time left for it to take over China. But give credit to Baidu for soundly winning round one.
September 13, 2006
Global superstars, like global companies, are realizing that it's not enough to launch an English-only Web site. If you want to truly speak to the world you need a multilingual Web site.
Even though her songs are in English her Web site has been localized, to varying degree, for eight countries.
This site is clearly a work in progress. Flags are used for navigation and the French and Italian flags don't work yet. And why they used "Holland" instead of "Netherlands" seems a bit odd -- perhaps it was a spacing decision.The local sites do not use a global design template, which would have made for an easier rollout of the new album promotional elements.
Still, there are some nice touches. For instance, the Japanese site features an interview using Japanese subtitles. And if you visit the German site you'll find a link to iTunes Germany to purchase songs.
Now, because this is a link to the German iTunes store, you'll need a German user account to make a purchase. For those of us in the US, we're going to see this little error message if we select the link...
Why can't iTunes sell songs across borders? Because the record industry won't allow it. Although Beyoncé is ahead of most of her peers in Web globalization, there are still some limits to how far you can go.
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September 5, 2006
SDL announced interim financials today, showing 34% growth over 2005 and bringing the company in at roughly US$170 million this year.
At this rate, the company stands to break the $200 million barrier in '07.
SDL released a few details on who's buying their software/services...
- New enterprise customer agreements with AGCO, Dell, and FedEx
- Desktop software market share increased to over 90% of translation industries’ professionals, with more than 130,000 installations
- Knowledge-based Translation Solution customer wins include HP, Computer Associates, and Microsoft
The Knowledge-based Translation Solution integrates machine translation (MT) software into the mix, another sign that we're going to see A LOT of activity on the MT front in the years ahead.
No mention of how SDL's new certification program is doing. Could be too early to say. Certification in this industry -- from software to services -- is a topic I plan to write about more in the months ahead. There certainly appears to be a need for it.
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