China Mobile has joined forces with the state-owned Xinhua News Agency to create the state-owned search engine Panguso. Their new offering pits itself against the current incumbent, Baidu, which has 75% of the search market in China.
The idea is that Xinhua, which is one of the world's largest news agencies, will provide the content -- and judging by the front page, news is definitely front and center at the moment. China Mobile, with its 600 million mobile subscribers, will provide the technological expertise, and maintain an SMS bridge between the search engine and its mobile users.
This isn't just about mobile, though: China has 450 million Internet users, and Panguso's launch is obviously the Chinese government's attempt to grab back some of the market share from Baidu and Google. Google, incidentally, decamped from China to Hong Kong back in March 2010 -- and it was only in August 2010 that China Mobile and Xinhua begun work on Panguso. Baidu has enjoyed a virtual monopoly since its inception in 2000.
In a day and age where we have grown accustomed to the democratization and decentralization of information, it seems rather odd to see the emergence of a state-owned search engine. China already has a very strict policy on censoring politically-sensitive material, which Baidu strictly abides by -- so unless it wants to further extend its control of information inside its borders, why would the Chinese government be interested in offering an alternative?
If we fast forward a few years, to when the Chinese government eventually blocks Baidu, a whole 20% of the Internet's populace will be forced to use a state-owned search engine. Xinhua, the government-run news agency, would of course become the de facto source of news for every cellular and Internet user in China. You can probably imagine what it would be like to have just a single news source in the U.S. -- now imagine that, plus a firewall that prevents you from easily peering beyond your border to see what's actually going on...