Chinese government launches its own search engine

On Thursday, Xinhua news agency and China Mobile announced a deal to create a new search engine. Both the first and second are state-owned companies.

China Mobile is the largest and most expensive mobile operator in the world, with its 508 million subscribers. Naturally, it is highly traded on both the New York and Hong Kong stock exchanges.

Xinhua (Xinhua in Russian) - an information agency reflecting the Party’s official policy; reports directly to the propaganda department of the Communist Party.

The government under Hu Jintao has already criticized the national television channel, which, in their opinion, broadcasts narrow-minded programs that encourage craving for material prosperity and frivolous behavior. However, these programs are very popular among the population, as evidenced by their high rating (no one forbade advertising in China).

Many Chinese people use the domestic Baidu search engine and, to a lesser extent, Google. The latter is used by those who are bolder and want to observe the actual results of the issue. In particular, they are looking for a video that lives in China on two video hosting services Youku and Tudou. They are private and their investors are foreign, so it is expected that in 2011 the hosting companies will move outside of China. And now, in order to reduce the strength of the wind of change in the minds of the Chinese, the State Administration of Broadcasting, Cinematography and Television (SARFT) has demanded that video hosting companies go through the licensing process along with television channels.

Naturally, from the creation of the new system, private Baidu will suffer to a greater extent. Google to a lesser extent, because it also takes a smaller market share.

This is not just a decision of the Chinese government - it is a step in the state’s campaign against the growing private sector.
And although there is plenty of money from the mobile giant and the news agency to invite specialists, for example, however, much in China depends on politics. Questions that will certainly appear on the horizon:

- Will the new system be censored, if so, how much? What to do with ideologically unstable but popular content among young people if it increases advertising revenue?

- How will costs and revenues be shared between the two companies, especially since China Mobile weighs more than a partner?

- Since the new company is state owned, will it receive electricity benefits?

- Will the search engine be popular or was it not worth it?

- Will the National Property Supervisory Committee (SASAC) prescribe state. companies buy ads from a public search engine, and not from two private?

- Who will be at the head - competent businessmen or loyal functionaries?

- Will foreign investors be allowed in?

The party seeks to whitewash itself after numerous corruption scandals, optimizing the work of the state. companies. However, many Chinese and foreign investors fear that they will not be able to compete with state-owned corporations because of the powerful administrative resources available to the latter.

via businessinsider.com