China Mobile is joining forces with China’s government-owned official state news agency, Xinhua, to work on a mobile search joint-venture. According to Reuters, the two companies have signed a framework agreement to establish a search engine company. China Mobile confirmed the alliance, but noted it was an agreement between Xinhua and the operator’s state-run parent.
The move comes on the heels of the mobile search growth in China, following the launch of 3G services in the world’s most populous country last year.
CLSA analyst Elinor Leung believes the China Mobile/Xinhua partnership will likely focus on local search services rather than web searches. She said: “I understand why China Mobile wants to do it themselves. It doesn’t mean they will compete directly with Baidu.”
According to Analysys International’s figures, China’s mobile search sector is currently led by Baidu with about a third of the market, followed by Easou on 17% and Google on 12%.
[Via: MobileBusinessBriefing]