Traditionally world compare China to a slumbering dragon. And for West or other developed countries, this is used as a great opportunity to access a great volume of inexpensive labours and huge manufacturing capabilities. Interestingly, now the dragon comes fully awake and the rest of the world had better watch out. Same goes to Google when China discovering Baidu-often referred to as China’s Google in 2000. Is this China’s Google ready for what the Google has become in the time it’s been sleeping? Apparently, they do when it dominate 60.4 percent market share in 2007. Perhaps, providing China the best way to find information by focusing on what they know best - complex language, giving Baidu a competitive advantage over Google.
2.0 The Environment
Widely perceived as one of the biggest market in the world, China internet users are more than any other country. In 2000 Google took this opportunity the spread their wings as a global internet provider to serve China market using its Chinese language version and did well. The celebration then been distracted by China government when they restricts foreign investment in China. Accordingly, Baidu (Robin Yanhong Li and Eric Yong Xu-co founders) once again used their privilege as a China citizen to gain a market power. As a formidable competitor, Google mapped out all strategies that they can use to enter this market and one of that was working on a Chinese name- Gu Ge. Finally, after all the debates, consumer surveys and consultations, Google now has been able to enter China.
3.0 The Industry
Threat of Entry| :| Low| * High entry costs * Significant software costs * Un stabilize country regulatory | Buyer Power| :| High| * Low switching costs * Market highly fragmented| Supplier Power| :| Medium| * Baidu Netcom is hedge|
Competitive Rivalry| :| High| * Numerous competitors-Google, Yahoo| Product Substitutes| :| Medium| * Newspaper...