Mountain View, California-based Google has grown to become the leading Internet search engine company in  most global markets, yet it still lags far behind among the populations of a small group of key nations such as China and Russia, where local search firms such as Baidu and Yandex have flourished and are now seeking to build on the local advantages they hold over the global search leader. Unique Challenges For Google In Key Nations Besides China and Russia, Google has struggled in Japan, South Korea and the Czech Republic, despite increased efforts over the past three years to make inroads with consumers in the few nations where it has not had the  type of phenomenal success it has achieved in many nations. The search engine firms that have succeeded in countries where Google has not appear to have used a combination of methods to reach their leading positions, including beating the United States firm to the punch by making investments long before Google made its own financial moves in nations such as China and Russia, and by making better use of local language features. Having used the leading search engines in these nations for years, consumers have been reluctant to switch from the familiar to Google, despite its increased efforts to win them over with new features and locally-flavored improvements to existing technologies. Yandex, Baidu and the other search engine firms in nations where Google plays only a relatively minor role have looked to take advantage of the name recognition they have built over time, and have succeeded using the portal approach to search, with its myriad of extra features besides Web search, rather than Google's more search-centric offerings. Entrenched with a sizable majority of their populations using local search engines, Baidu and the handful of others firms who hold dominant positions over Google have sought to cement the leads they have built, in some cases succeeding despite improvements in local search and heavy investment by Google over the past several years. China's Baidu Tops Google Amidst Continued Expansion China's Baidu holds a 65.8 percent share of that country's search market, according to the most recent research from market analysis firm China IntelliConsulting Corporation, nearly tripling the 22 percent share held by Google. Beijing-based Chinese language search engine company Baidu.com, Inc. is among the most used search Web sites in the world, and has seen growth achieved by no other high tech company before in China. By one recent measure Baidu has passed Google to become the leading region specific search engine. Reston, Virginia-based Web traffic analysis firm comScore said that  Baidu accounted for 7.406 billion search queries during July in the ten country Asia Pacific region, while data from a separate comScore study found that Google was used for 7.398 billion searches in the U.S. during August. Baidu said that with the addition of a new test version of a business site, it now serves 196 million people daily performing close to 12 billion searches each month. Chief among the markets where Google does not dominate is China, where the U.S. firm has expressed frustration with a series of regulations that it says makes competing with firms such as Baidu more difficult. Earlier this year China overtook the U.S. as the country with the most Internet users, and by June had extended its lead with some 253 million consumers online, well ahead of the 230 million in the U.S. Google has continued to struggle in China, which added some 91 million new Internet users over the past year according to the country's China Internet Network Information Center, a government backed non-profit organization that has been producing semi-annual studies on Internet usage in China since it began operations in 1997. Legal Obstacles Said To Hinder Google China Gains Google chief executive Eric Schmidt said that some of the legal obstacles foreign firms face in China have slowed the pace of outside technology making its way into the country. "Because Baidu had such a head start largely because of the various bizarre laws that China has with respect to foreign media," Schmidt said in a recent Financial Times report. "It will take a while, but we will eventually do well there. All of us should tell the Chinese that their local markets need to be open to foreign investment, they need not favor their local competitors," Schmidt added. Earlier this year Haoyu Shen, Baidu's vice president of business operations, said the Internet had recently experienced increased popularity in China like never before. "The Internet is playing an increasingly important role in people's lives in China, and we are constantly looking for ways to bring more convenience and functionality to our users," Shen said. Baidu, which began in September 2004, made a successful initial public offering on NASDAQ in August 2005 that led to inclusion in the NASDAQ-100 list, China's first company in the index. Baidu now boasts more than 1 billion daily online advertising impressions delivered through its Baidu Union advertising network, according to the company. In 2005 Google opened a research and development center in China, and at one point held an investment in Baidu, which it sold in 2006 for some $55 million. In 2006 eBay gave up control of its operations in China after being overtaken by China's Alibaba Group and its Taobao.com property, passing the business on to a local partner. Google has shown no intention of exiting the huge market that is China, and has instead increased efforts to gain ground among China's consumers. Russia's Yandex Dominant Despite Google Efforts Yandex is Russia's top search engine, followed by Google and Rambler, according to figures from Liveinternet. According to recent search engine usage metrics, Yandex holds nearly a 50 percent share of the search market in Russia, and after several months of planning the firm is expected to become a listed company on the U.S. stock market. In July Google agreed to purchase Russia's ZAO  Begun advertising agency for $140 million from Rambler Media Ltd., which operates the country's third largest search engine. Google co-founder Sergey Brin is of Russian descent, his family coming to the U.S. when he was six years old. Google's deal with Begun was made in part to give Google a stronger position in the emerging online advertising market in Russia. Earlier this year Rambler also signed an agreement to use Google's AdSense contextual advertising program on its www.rambler.ru search engine site. Rambler was Russia's first listed Internet company and is controlled by the country's Prof-Media, a holding firm led by billionaire investor Vladimir Potanin. Google, which already has roughly 100 employees in Russia located in the cities of Moscow and St. Petersburg, said it expected the Begun and Rambler deals to help expand its presence in the country. "This agreement illustrates our commitment to investing in Russia, where online advertising is currently experiencing rapid growth," said Google managing director for emerging markets Mohammad Gawdat. "Google is very committed to giving Russian users, advertisers and partners the best possible service and experience," Gawdat added at the time. The online advertising business has shown rapid growth in Russia, where it is expected to reach a total of $685 million in 2008, according to a study from Mindshare Interaction. The explosive growth of the Internet in Russia has drawn some top search firm executives away from other nations. In June Yahoo senior vice president of search Vish Makhijani announced that he would depart the company's San Francisco area operations to take a position at Yandex. Another nation where Google hasn't had its typical success is Japan. Japan Search Market Led By Yahoo Japan While Czech Users Prefer Seznam Japan's leading search engine firm, Yahoo Japan, is used for more than half of all searches performed in that country, success some analysts have attributed to the firm's varied portal offerings beyond Web search. For a time over the past few years, Japan saw Google gain ground on Yahoo Japan, only to fall back as the local search company rebounded. In its earlier days Google had a search partnership with Yahoo Japan, beginning in 2001. Google is not as dominant in Japan as in the U.S. and other global regions, especially among mobile device users, lagging far behind leader  Yahoo Japan Corp., which has a partnership with the country's third largest mobile provider Softbank Corp. Softbank, which entered the mobile market in Japan in 2006 when it purchased the local Vodafone property, owns shares totaling 40 percent of Yahoo Japan. Compared to Yahoo, Google arrived late in the Japanese mobile market. Among Web searchers in the Czech Republic some 63 percent use Seznam's seznam.cz Web portal according to recent search engine usage metrics, more than twice the 29 percent share seen for Google in the country. Seznam, which was founded in 1996 by Ivo Lukacovic, led the country with about 4.4 million users according to a June Czech Business Weekly report. Some industry observers have considered the firm a likely takeover target for several Czech firms or, perhaps, for Google, although the Mountain View firm has not publicly stated any interest in acquiring Seznam. Google In Unfamiliar Trailing Role In Some Large Markets South Korea is another nation where Google has found itself in the role of search engine underdog. South Korea's Naver holds a 60 percent share of that country's search market, well ahead of Google. Last week Google's Korean unit acquired Tatter and Co., a South Korea-based blogging platform. Some industry observers view Google as having good long range prospects for gaining majority search shares even in countries such as China and Russia, due to its financial and technological strengths and the name recognition it has seen grow. Last week Google became one of the top ten brands worldwide according to a recent audit by brand consultant company Interbrand. In July, Google for the first time reported greater revenues outside the U.S. than in its home country, with second-quarter revenues of $2.8 billion outside the U.S., accounting for 52 percent of its total revenues and an increase over both the previous quarter's 51 percent and the previous year's 48 percent during the same quarter. Despite the difficulties it has faced in Russia, China, South Korea, the Czech Republic and Japan, by committing to increase its presence and market share over the long haul through technical innovation and improved local features, Google could someday find itself in the role of the dominant search engine the world over. In the meantime Google has found ample success throughout much of the rest of the world, a situation that Gawdat found encouraging. "It may take more time, but who cares? The rest of the world is doing really well," Gawdat said. Related Links :
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2:42 am on Sep. 23, 2008 (utc 0)