According to China Daily the online search industry in China will continue to be competitive as smaller players look to challenge the Baidu, Inc. ((ADR) NASDAQ: BIDU), the dominant leader. In particular Sohu.com Inc. (NASDAQ: SOHU), one of China’s largest Internet portals, has announced its plans to invest aggressively in its search subsidiary, Sogou, by doubling its staff to 1,400 people. The new employees will purportedly be mainly in engineering and marketing.
The Chinese search market is similar to the U.S. with a dominant leader and a handful of smaller competitors funded by larger Internet companies. In November, according to online data research company Cnzz.com Inc., Baidu’s search traffic accounted for almost 81% of the total while Sogou had almost 8% and Google Inc. (NASDAQ: GOOG) has fallen to just over 5%.
Google departed from mainland China in early 2010 after a decision to not comply with Chinese regulations on censoring certain types of search results. The fallout of that decision has been a tremendous fall from the second largest search engine with almost 30% of total traffic to the number three player with around 5%. As Google lost its position as Baidu’s top competitor, other search engines such as Sogou have been more aggressive in taking the place as the leading challenger.
Of course, despite seeing its share of search traffic fall, according to iResearch estimates, Google still remains at the number two spot in terms of its share of total search revenue, far ahead of Sogou. 
Besides Baidu, Sogou, and Google other search engine competitors include Soso, which is run by Tencent Holdings Ltd (HKG: 0700), the biggest Internet company in China as measured by revenue, and eTao, a shopping search engine run by e-commerce leader Alibaba.com (HKG: 1688).
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