Google seeks fortune in China with wireless, video site deals
Internet giant Google has further penetrated the Chinese market via a new partnership with China Mobile, the world's largest mobile telecommunications carrier, and by acquiring a small stake in growing Chinese entertainment download site, Xunlei.com.
The Mountain View, CA-based search giant's deal with China Mobile, whose terms were not disclosed, lets customers of the wireless provider use mobile search on its Monternet WAP portal. Users can search content such as sports and entertainment news, ringtones, games, images, videos and novels.
The first-phase service has been in trial operation since last month and will be launched broadly in the early part of 2007.
The deal with Xuenlei.com equips the Chinese music and video download site with Google search capabilities. The terms of this deal were also not disclosed. But the New York Times reported that " people close to the companies said Google paid about $5 million for a 4 percent stake in the company."
These partnerships come a year after Google set up the Google.cn site, a site that censors itself to satisfy the authorities in Beijing despite critics warning about restricting access to topics like the Tiananmen Square massacre and the independence of Taiwan.
While Google did not concede to censorship immediately, the Internet giant decided that it would have been more damaging to pull out of China altogether. Google's argument was that it could play a more useful role in China by participating than by boycotting in the market, despite the compromises involved.
Google competes with Beijing-based rival Baidu.com and Yahoo China for the growing search marketplace. This week China reported having 132 million Internet users, up 30 percent from last year.