Tough Challenge for Panguso in Search Engine Market: Analyst
    2011-02-24 13:17:42      Web Editor: Sun

"It is already a late comer. And for it to beat off the competition, even at home, I think it could be quite difficult."

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A staff member tests a computer during the launching ceremony of the search engine Panguso in Beijing, capital of China, Feb. 22, 2011. Xinhua News Agency launched the Internet search engine,, jointly with China Mobile on Tuesday. Panguso has designed an accurate search service for news, websites, images, videos and audio data. [Photo:Xinhua/Jin Liangkuai]

The Xinnua news agency and China Mobile jointly unveiled a new search engine on Tuesday, a move some described as an effort to have a finger in the pie currently dominated by Baidu and Google.

With more than 450 million users, China is now the world's largest Internet market.

Statistics from iResearch show China's search market grew 67 percent in the fourth quarter of 2010 to more than 3 billion yuan (about $487 million USD), with Baidu holding a dominant 73 percent of the market by revenue compared with Google's 24 percent.

Xinhua said the new search engine,, is expected to lead the domestic market as it combines the strength of its rich news resources and the latest network technologies of China Mobile.

However, some analysts are questioning whether Panguso can beat off competition in China.

Gu Wei, columnist of Reuters Breakingviews, said as a latecomer of the industry, it's hard for Panguso to catch up against its peers at home.
"It's a new search engine basically. I tried it yesterday, and I think it still has some ways to go in providing good and precise results", said Gu, "I think it's an uphill battle for Pangguso to beat off the competition. Even at home, I think it could be quite difficult."

Panguso is another state-supported search engine in China following the launch of the People's Daily's last December.

Gu said the role of a state-sponsored site makes it difficult for Panguso to integrate into the international market.

"In the international market, it has even more challenges to shake off the perception it got. It is a state-owned search engine", said the analyst.

Besides Xinhua's capacity of collecting information, Panguso takes advantage of China Mobile's research and development of online search technologies. It allows users to send search results from computers to cell phones by SMS.

Considering the strength of the new service, Gu said the ease of use might persuade people with basic phones to use it a bit more. But as people's phones get more sophisticated, that shouldn't really matter unless other search engines are blocked on the phone.

(Wei Gu, a Reuters Breakingviews columnist. The opinions expressed are her own.)


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