CIC Corporation released the Investigation Report on China Search Engine Market of 2007 in the past few days. In accordance with the report, Baidu and Google had occupied 92.5 percent of the market share in China, while other search engine companies had lost market share further. According to the data released by Analysys International, Baidu had 58.1 percent of the market share in China web search market in the second quarter, well ahead of other rivals, while Google was in the second place for taking 22.8 percent of the market share.

In China search engine market, Baidu increases its market share at the cost of the decrease of market share of Google, so dual-oligopolist competition era has come to China search engine market.

There are three reasons for Baidu to develop fast in China. First, Baidu understands features of commercial environment and user group in China, in possession of deep intellect, flexible decision mechanism and strong persistent innovation capability. To the user, Baidu is more suitable for the using habits of Chinese people. Insiders said that Google has better technologies, but there is no linear relationship between technology and user experience or market share, etc, and the invalid snapshot function of Google is one of factors for many users to choose Baidu finally. Second, Baidu pays more attention on marketing, with strong commercial atmosphere. Lv Bowang, a senior insider of this industry, said that Baidu had shifted its focus from improving search engine to marketing in recent years, so as to attract more advertisement customers. Third, the people using search engine in China tend to be young, and Baidu is devoting its mind to this domain.

Baidu is not as strong as Google in the capital market; in the product R&D aspect, except perfecting search engine, Baidu has no other products to bring integrated using experiences and inertia for customers; Baidu has gotten behind Google in the strategic cooperation of wireless network. Though it can only provide searching service for the limitation in its own product, Baidu is still the leader in China search market. According to insiders¡¯ anticipation, none can capture Baidu¡¯s leadership in some time.

In contrast, Google, the global search giant, has a tough way of development in china. According to the data, although Google leads Baidu in most indicators of website satisfaction and user satisfaction, it has less than half of the market share of Baidu.

Recently, Google announced that it had reduced its gap with Baidu in China web search market, which cannot be shown in related data. Hereinto, an important reason is that Baidu has too obvious advantage in China search market that Google can only seize the market Baidu has not taken.

In recent years, Google, keeping low profile, had made great efforts in localization with primary effects. Through establishing cooperative partnership with Sina.com, Google has obtained part market share in China web search market. Besides that, Google had established cooperative partnership with Tianya.cn and CDC, the parent company of china.com.

At present, in the world, Google has incomparable achievements over Baidu. Google has a market value of almost USD 180 Billion, but Baidu has only USD 11 billion, for Baidu based on Chinese search cannot compete with Google in the global market, moreover Google has over 48 percent of business income from its international businesses.

It is unfavorable for customers to have one giant in any commercial field, and the search market is no exception. Baidu dominates China search market, which cannot promote the search market going on the track of sound progress. Putting aside the victory and defeat between Baidu and Google, Google, speeding up its pace of localization, can drive China search market to develop further, which consumers would like to see.