Recent data compiled by comScore, a digital business analytics firm, shows continued strength for Google in the search engine field. The leader in search engines, Google remains the top choice among searches in the United States and is still the top search engine in the world. However, Google has not been able to establish that same position of strength in China, the world’s most populous nation with a fast growing consumer base.
Now the news is getting worse for Google behind the wall as a new competitor is emerging in the search engine business in China. Alibaba, an Internet company based in China, is launching a new search engine titled Aliyun in an effort to not only challenge the most popular search engine in China (Baidu) but Google as well.
Aliyun, which will be housed within the AliCloud subsidiary of Alibaba Group, will provide Web surfers with many of the same features that other search engines offer. The page will feature Internet, news, image, and map searches. The map service available on Aliyun will be powered by AutoNavi, a Chinese digital mapping and navigation firm.
Currently, the Chinese search engine marketplace is dominated by Baidu. With a 72.97 percent share of the market in China, Baidu’s dominance might be better labeled as a choke hold on the industry. The next closest competitor, Qihoo 360 at 9.64 percent, cannot even claim a double digit share of the marketplace. Third place belongs to Sogou at 7.83 percent, followed by Google in fourth with a humbling 4.72 percent share. Bing heads up a list of several search engines that can claim less than 1 percent of the market.
With such a cluttered industry dominated by one provider, it might seem confusing that another business would want to step into the ring. However, there is more to this story than the entrance of another competitor in the Chinese search engine marketplace. The Alibaba Group has deep financial pockets, and therefore has the means to take a measured approach at cracking into the Chinese market and doesn’t need to rush through an “all or nothing” approach right out of the gates.
While the main goal of any company launching a search engine is to challenge the leader, Baidu in this case, Alibaba appears to be out to stick it to Google. For starters, it seems to be no small coincidence to industry analysts that Aliyun’s search engine will have more in common visually with Google than other competitors in the Chinese marketplace.
Beyond a similar look to its search engine, Aliyun’s entrance into the market may be another shot across the bow in the battle between Google and Alibaba in China. Yes, these two competitors in the tech industry have a history with one another in the country, and it is not one that would be described as friendly.
Last year Alibaba created the Aliyun mobile OS for use on smartphones in China and had convinced Acer to develop a handset running the operating system. However, Google quickly stepped in to rain on Alibaba’s parade by forcing Acer to back out of the project. Google’s reasoning was that the Aliyun mobile OS, which uses Android technology, was not a strong and compatible Android OS. As Acer is a member of the Open Handset Alliance, it was not allowed to sign onto the project and pulled out.
In an explanation at the time, Google pointed out that:
“Compatibility is at the heart of the Android ecosystem and ensures a consistent experience for developers, manufacturers, and consumers.
Non-compatible versions of Android, like Aliyun, weaken the ecosystem. All members of the Open Handset Alliance have committed to building one Android platform and to not ship non-compatible Android devices.
This does not however, keep OHA members from participating in competing ecosystems.”
To summarize, Google doesn’t care if Acer develops handsets for use with Windows Phone 8, Apple iOS, or Blackberry OS. On the other hand, they are not allowed to create a handset that operates on an Android OS that is deemed to be inferior.
It seems obvious that there is no “fuzzy feeling” between these two companies, but Alibaba’s move with the Aliyun search engine could work out better than the Aliyun mobile OS did in China. Google’s position in China is admittedly weak, and data from 2012 shows that Google’s positioning in fourth place is not exactly concrete.
While competitors that are already ahead of Google in China, namely Qihoo 360, experienced growth in 2012, Google’s position weakened. Qihoo 360 saw a 2 percent jump in page visits and unique visits during the final quarter of 2012 alone, going from 7.3 percent and 7.4 percent respectively to 9.6 percent and 9.8 percent. By contrast, the final quarter of 2012 saw Google’s share of the market dip from 5.1 percent and 5.2 percent respectively to 4.7 percent and 4.5 percent.