Friday, July 22, 2005

Microsoft and Google Prepared to fight for China's Internet Marketplace

From ZDNetIndia: Microsoft, Google duke it out for China

"China is quickly proving to be the next great Internet marketplace, and both Microsoft and Google are prepared to fight for it, starting in American courtrooms.

On Monday, the software giant sued Kai-Fu Lee, a former vice president of search technologies and Microsoft's chief architect of business strategy in China, for an alleged breach of a noncompete and confidentiality agreement. Microsoft also sued Google, claiming it was knowingly complicit in the alleged breach when it hired Lee to head up its new Chinese research center."

"With an estimated 100 million people online, China's Internet audience is second only to that of the United States, and financial analysts believe it will surpass America's Internet population within five years. China also has 350 million mobile phone subscribers, 43 million broadband homes and 20 million online gamers--the largest gaming population in the world, according to Piper Jaffray."

"China's Internet economy, which includes sales from e-commerce and advertising, also has plenty of room to grow. It's worth about only 5 percent of the U.S. Internet economy, according to analysts at Piper Jaffray. The analysts expect Chinese interactive sales, including online advertising, e-commerce, games and wireless, to be worth $1.38 billion in 2005. Next year, sales are expected to grow 37 percent to $1.9 billion."

"China is going to be the most significant opportunity for growth for Internet companies over the next five years," said U.S. Bancorp Piper Jaffray analyst Safa Rashtchy."

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