Google China Market Share Falls to Lowest Since 2007

Google Inc.’s market share in China fell to its lowest in almost three years after a dispute with the government prompted the company to review its operations, allowing Baidu Inc. to gain sales at a faster pace, according to iResearch Inc.

The U.S. company accounted for 24.6 percent of China’s Internet search-engine market in the third-quarter, dropping from 26.8 percent in the previous three months, Nelly Jin, an analyst at IResearch in Beijing, said by phone today. That’s the lowest since the fourth-quarter of 2007, she said.

Google had been losing market share to Beijing-based Baidu since January, when the owner of the world’s most-popular search engine said it was no longer willing to comply with Chinese government requirements for web sites to self-censor content. The U.S. company in March shut its Chinese search service and redirected local users to its unfiltered Hong Kong site.

Baidu’s market share increased to 72.9 percent in the third quarter from 71 percent, according to IResearch.

In July, China renewed Google’s Internet license after the U.S. company changed the arrangement used to re-direct internet traffic to the Hong Kong site. A month earlier, Google stopped automatically redirecting users to the Hong Kong site and put in place a so-called landing page that requires users to opt for the alternative service.

To contact the reporter on this story: Mark Lee in Hong Kong at wlee37@bloomberg.net

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net

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