Google falling behind in China

Popular Internet search engine Google is losing ground to its main rival in China as it fails to attract as many college students and other young people, according to a survey compiled by China's official Internet statistics cruncher.

Over the past six months, Baidu.com's share of the Internet search market in three key cities, Beijing, Shanghai and Guangzhou, has risen by over 10 percent, while Google's has stood still despite a growing number of Internet users in China, the China Internet Network Information Center (CNNIC) said Monday.

Over half of the Web users surveyed in Beijing, 51.5 percent, preferred to search the Internet using Baidu, while Google took second place with a 32.9 percent share of the market and Yahoo came in fifth with only 3.7 percent.

In Shanghai, the race was closer, with Baidu at 43.9 percent and Google second at 38.2 percent, while in Guangzhou, Baidu led Google 48 percent to 28.7 percent, CNNIC said. The survey was conducted in August.

Among young people in the three Chinese cities, nearly two-thirds of the under-25 crowd use Baidu, compared to 23.7 percent for Google. College students prefer Baidu by over two to one to Google, according to the CNNIC statistics, or 58.9 percent to 27.7 percent.

The figures could prompt Google to revise its China strategy. China's Internet scene has been hot lately, with Yahoo earlier this month agreeing to pay $1 billion and transfer all of its Chinese businesses to China's Alibaba.com for a 40 percent stake in the company.

Baidu, a company Google owns a 2.6 percent stake in, also raised over $100 million in its recent public stock offering in the U.S., adding to its war chest.

Companies and analysts see a lot of potential in China's Internet market. The country ranks behind only the U.S. in terms of total Internet users, with 103 million, according to CNNIC. While that's only about half the number of users in the U.S., it accounts for only 8 percent of China's population, compared to nearly 69 percent for the U.S.