Google in China refocus as demand for mobile ads more than doubles

Search giant capitalises on country’s 388 million users of phones and handhelds
Google may have found a back door into China’s huge internet market after more than doubling traffic through mobile advertising, it has emerged.¬†Two years ago the company pulled its search engine operations from the Chinese mainland amid clashes with the authorities over censorship and stiff competition from local rival Baidu. Over the weekend it revealed it will also be closing its China-only music service, despite the fact that the country has more than half a billion Internet users – the world’s highest number.But according to reports today [22nd October 2012] from China Daily, Google’s new strategy is to focus on mobile advertising there as use of phones, tablets and other roaming devices surges and, with it, opportunities for marketing.

The newspaper reveals that up to July this year advertising demand in China through Google’s mobile apps, web pages, online videos and search results shot up by 120 per cent over the previous year, although it is not known how much of this contributes to Google’s total revenues.

But it’s believed that Google’s mobile ad revenues are growing fast globally with one analyst, Jim Friedland of US-based financial services company Cowen Group, calculating that it equated to three per cent of income in 2010, seven per cent in 2011 and will probably double to 13 per cent this year.

As adoption of smartphones and other handhelds mushrooms in China, it’s thought Google’s aim will be to capitalise on the shift away from PCs as the traditional means of Internet access.

All the more so as the country looks set to overtake the USA as the world’s biggest smartphone market this year, according to market research firm IDC, with a record 388 million Chinese already accessing the Internet via mobile devices.

Google CEO Larry Page, in his quarterly earnings call four days’ ago [18th October 2012], revealed how the company’s mobile ad run rate had jumped from $2.5 billion by the end of the third quarter in 2011 to roughly $8 billion in 2012′s third quarter with growth attributed to additional mobile revenue from users paying for content and apps in Google Play.

** Footnote** A promising omen for Google’s future in China looks as though it has been found at the Museum of History in Shanxi Province with the discovery of an Android artefact from thousands of years ago. See here.

About Dave Evans

Dave Evans was a long established commentator on both the IT and cellular industries. His last focus was on share price trends within the sector. He passed away in September [2014].
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One Response to Google in China refocus as demand for mobile ads more than doubles

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