“We can now, with real knives and real guns, PK them again, win again,” he said. “In 2010, when Google withdrew from China, its market share was declining and Baidu’s market share had exceeded 70 percent.” The CEO was speaking in response to reports that state media welcomes Google back as long as it complies with the law. The idea has proven controversial among employees and U.S. senators, who believe Google has a moral imperative to not condone censorship. However, it’s true that Google could have a trying time even if it does enter the market. The state-run People’s Daily article that suggested China’s approval was later removed, making the government’s stance questionable. Relations between the U.S. and China remain strained, and the company’s decision to pull out in 2010 hasn’t put it in citizen’s good graces. Baidu recently hired former Microsoft AI expert Qi Lu as its COO and opened an Augmented Reality lab, so it’s on track to compete in terms of features. It’s also working with Microsoft to build an autonomous vehicle platform.
8 Years Later, Baidu Still Dominates
According to Statista, Baidu also has a 73.8% market share in China, so Li is right to be confident. More than that, he believes that Chinese companies have the confidence and abilities to compete on a global scale. Statista puts Google at an 86.31% market share in the US, combined with a strong dominance in advertising. However, if it were to enter the market it again, it would face stiff competition from the likes of Shenma, Haosu, and even Microsoft’s Bing. Additionally, reports suggest that overall advertising revenue from search is falling in China as users search from within social media apps like WeChat. In all, it seems unlikely Google will unseat Baidu’s long reign, but that may not necessarily be the company’s goal. Though its search engine pulled out of China, Google still has offices in the country and has released apps like Files Go. Re-entering the search market may open up new opportunities for integration and collaboration. Afterall, Microsoft has had moderate success in the region with its Xiaoice chatbot, which now has full Duplex capabilities. If the rumors are true, it could end up being an expensive mistake for Google, but the company may decide it’s worth the risk.
