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December 29, 2009 1:44 PM

Microsoft Wants Bing to Become Big Chinese Player



Microsoft is determined to seize the large and growing Chinese search engine market, according to a statement circulating online.

"Microsoft is committed to the China market and the search market in China is the most important strategic market for Microsoft," Microsoft told Reuters on Dec. 29. "We specifically set the search technology center in China to get a deeper understanding of what Chinese users need, to be able to deliver the best product to them."

But as T.S. Eliot might have said, there's a substantial shadow between the concept and the reality. And in the reality, Microsoft has a long, steep road ahead if it wants to catch up to the reigning players in the China space.

According to research company Analysys International, as cited by Reuters, Chinese search engine Baidu currently leads the country's search engine market with 63.9 percent, followed by Google with 31.3 percent. Meanwhile, another research company estimated that Bing (which launched in China in June, and is still technically a beta) occupied less than 1 percent of the Chinese search engine market in the second quarter of 2009.

Within the United States, Bing currently owns less than 10 percent of the market (depending on which research company's data you use; Experian Hitwise plugged it at 9.57 percent for October, while ComScore said 9.9 percent), while Google dominates at around 65 percent and Yahoo is somewhere in the 18 percent range. The big hope among Redmond's executives, most likely, is that the finalization of the Microsoft-Yahoo search and advertising deal will not only result in Bing seizing Yahoo's search engine market share with little to no attrition (under the terms of the deal, Bing will power search on Yahoo's sites) but also that the extra flood of data from Yahoo customers will allow Microsoft's engineers to refine Bing into a more robust Google competitor.

At least on paper, that seems like it could work--although Yahoo's steadily eroding market-share numbers may lead some to wonder about the "attrition" part--but it won't help Bing internationally, at least in the short term.

"It's possible that we will extend that partnership [with Yahoo] outside the U.S.," Microsoft CEO Steve Ballmer reportedly told a Tokyo news conference in November. "We will have to wait and see if we can get approval and consummate that partnership inside the U.S. first."

That sounds a little shaky to me. In any case, even if Bing becomes Yahoo's search engine in every international market, it won't substantially challenge Google for overall global search share--just take a look at this chart.

Short of Microsoft purchasing Baidu (an unlikely proposition), I'm not sure how it will make substantial gains in the Chinese search engine market, at least in the near to medium term. The Reuters article paraphrases one analyst as saying, "The number of users [in mainland China] who have visited the site at least three times a month has increased 30 percent as of October," but that doesn't seem to be having much effect on Bing's total share.

As with anything tech-related, the situation could change in a few years. But for the moment, I'm curious about how Microsoft will pursue its China/Bing strategy outside of refining its product. What do you think?

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Comments (1)

I do like bing. I think its a great search engine and it deserves to get more attantion and usage.

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