Bing and Baidu gain as Google’s share of online ads slows

27 Jul 2010

The global online search ad market hit US$6.2bn in the second quarter of 2010, up 2.7pc on the previous quarter with Chinese search leader Baidu and Microsoft’s Bing reporting growth while Google slips.

Market leader Google saw its core search revenue grow slightly, benefitting from higher cost per click. However, Google global revenue market share slipped by 1.4 percentage points compared to the previous quarter.

In contrast, the Chinese search market leader Baidu has capitalised on Google’s retreat from China and the overall rapid growth of the Chinese search market. Baidu’s revenue surged 76pc over the second quarter last year and by 49pc over Q1 2010.

As a result, its global search revenue market share grew by 1.4 percentage points in Q2 2010. In terms of revenue, Baidu is now the fourth largest search company in the world, with its sight set on Yahoo and Microsoft.

Google’s search revenue growth continues to slow down as the Western search market reaches maturity and Google struggles to gain share in the fastest-growing Asian markets,” said Martin Olausson, director of Digital Media Research at Strategy Analytics.

“As a company, it will become increasingly more important for Google to find significant new revenue streams in order to offset the decelerating search growth.”

“Google’s dispute with the Chinese government, and subsequent withdrawal from the Chinese market, has given Baidu the advantage of unrivalled growth in the world’s largest internet market,” added Jia Wu, analyst at Strategy Analytics Digital Consumer Practice.

“As a result, Baidu’s global revenue market share has grown to 4.6pc from 3.3pc in a single quarter. This growth is expected to continue for the rest of the year,” Wu said.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years