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Baidu claims Chinese search domination

You'd be forgiven for not having heard of Chinese search engine Baidu, but the scale of the site demonstrates the value of targeting the rapidly growing Chinese market: it has an audience of around 420 million.

The eyebrow-raising figures, which equate to a 99 per cent share of the Internet search market in China, came during an appearance by chief executive Robin Li during the Web 2.0 Summit event in which he discussed his decision not to move to Hong Kong to escape the Great Firewall of China.

Li is quoted by TechCrunch as claiming: "Baidu answers more search queries in China than any other search engine in any other market, including Google in the US."

That's a bold claim, but with around a third of China's population having access to the Internet, that's an audience of 420 million - and China's strict filtering policies against sites, including search engines, outside its control will have certainly helped push the company to its amazing 99 per cent market share.

Li puts his company's success firmly at the feet of local knowledge: "China is a very different market," he explains, "and Google was not close enough to feel the market."

The growth of Baidu has been incredible: in the last five years, the company's revenue has increased by thirty times, and its market cap is now estimated at around £25 billion - approximately the same as eBay, which for a company that does very little business outside its native country is incredible, and makes a mockery of early attempts by Google, Yahoo, and others to buy the company for around £1 billion.

Despite the crushing market share, Li believes that there are still opportunities for growth for his company - in particular, he sees the explosion of smartphones as a prime candidate for getting the next few million users searching via Baidu.

With Google and others looking to the Chinese market as the next area for expansion, can any Western company compete with the entrenched giant that is Baidu?