See China

The Internet and China are in the news together this week, with a whole lot of bluster about Google’s operations there, or not there, or somewhere. We’re not touching that one. However, China’s Internet is a vibrant place — it has the most users of any country, and some major companies have emerged, some of which are or will give their Silicon Valley compatriots a run for a lot of money.

Google’s biggest rival in China has long been Baidu.com. Baidu is the undisputed leader of search in China, with at least 60% of the market. Although Google supports searching in both simplified and traditional Chinese characters, Baidu supposedly offers better results to Chinese-language users because it “thinks” more like Chinese people do — whatever that means. Regardless, market survey after market survey has proved that Baidu is the market leader, with no real competition other than Google.

In the beginning, there was the holy trinity of the Chinese Internet — Netease, Sina and Sohu. These were the original “portal” sites, in the way that many early Web sites tried to offer all things to all users: search, news, e-mail, and more. While the once-mighty in the US have since fallen, such as AOL and Yahoo, these three continue to be among the most popular sites for Chinese users. Instead of becoming more streamlined and specialized, the huge number of links on each of their homepages indicates that they have only pushed harder into the general space. Although each has its own specialty, like games or bulletin boards, the two continue to offer a raft of mostly free services in an effort to maintain the largest slice of the pie of 330 million Internet users.

Of the three, the best known CEO is Sohu’s Charles Zhang Chaoyang. While getting his Ph.D. at Massachusetts Institute of Technology (MIT), he met Nicholas Negroponte, then head of MIT’s Media Lab. As the Internet was developing in the U.S., Negroponte and Zhang looked towards China, and Negroponte became one of Sohu’s (which translates as “search fox”) initial investors. Zhang has been Sohu’s only CEO since it was founded in the mid-1990s. Along with being a technology entrepreneur, Zhang is also an established outdoorsman and environmentalist.

The latest titan to emerge from China’s Internet deals not in content or search (at least not yet), but in deals — both business to business and business to consumer. The Alibaba.com Group operates not only Taobao.com, one of the world’s largest auction and retail sites, along with its eponymous www.alibaba.com, which connects buyers outside of China with producers and sellers inside the country. The Taobao juggernaut became so powerful that within three years from its launch, it drove eBay out of China, via its Eachnet site. Although it may difficult for users who don’t read Chinese, Taobao in many ways has become the department store for many Chinese consumers, both those who live in cities, who like the low prices they can find on the site, and for those who live in smaller cities and even rural areas, and have difficulty accessing a wide range of products.