Music 2.0 has shared detailed screen captures and commentary on the launch of Google China Music Search. I personally cannot get to this site (”Sorry, Google is not your region provide you with the services they need” message appears”), but Music 2.0 does have screen captures and calls this Google service “more impressive” then many of the international counterparts.

Google China Music Search ranks music on the home page by some form of popularity metric. You can clearly search by artist name and other criteria. You can even download the DRM-free music in mp3 format at a rate of 192kbps. Google offers the ability to stream the music via a Flash player. Lyrics are also provided in a pop up window. The pages seem to contain advertisements but I am not sure if the revenue is shared with the musicians.

In February, Danny wrote a piece named Google To Fight Baidu In China With Legal Music Downloads? That article goes more into the other services available in China and some of the challenges Google will have in the Chinese market.

Baidu has been plagued with copyright lawsuits over music search in the past; the most recent news we have is that they beat the music labels in court.

Postscript: A Google spokesperson gave us a statement clarifying the ads in this application:

Google does not share in the revenue generated by advertising in connection with its Music Onebox product in China. All ads visible on the product in connection with the product run on Top100’s website and revenues from those ads are shared between Top100 and its music label and publisher partners.

One of the key weaknesses Google has seemed to face in growing market share in China has been the fact that many people turn to Baidu to download music. Now the company may be fixing this, reports the Wall Street Journal:

Two years after Google Inc. began a big push in China, Baidu.com Inc. continues to dominate the country’s Internet search market, thanks in significant part to a controversial and legally risky offering: searches for free, unlicensed music downloads.

Now, Google is preparing a counterstrike, according to people close to the situation. The U.S. search giant is in the late planning stages of a joint venture with a Chinese online music company that would permit it to provide free — licensed — music downloads in China.

The service, which is likely to offer access to tunes from three global music companies as well as dozens of smaller players, could start in the next several weeks barring any last-minute hiccups. The music pact marks a turning point in Google’s battle with Baidu to gain dominance in an Internet market that is soon expected to surpass the U.S. this year in number of users.

The report notes that 7 percent of Baidu’s traffic is from access to free music, but that Baidu has been a target of copyright actions because of this. Of course, just last month Baidu won a copyright case against it (Baidu Beats Music Labels In Music Copyright Case Again), so those copyright issues haven’t seemed to slow it down over the years. In contrast, Yahoo China in December lost a case (Yahoo China Loses Case On Linking To Unlicensed Music).

Things might change more, however. A global music trade group is targeting both Baidu and Yahoo with new cases asking for thousands of sites to be removed.

Google hasn’t been targeted in music cases, the Wall Street Journal says, since it hasn’t offered a music search feature. To avoid such actions, plans are said to involve files that are digitally watermarked. These files, from a variety of record labels, are already offered via Top100.cn. Google is said to be partnering with Top100.cn to provide enhanced search and other features.

For some background on the importance of music search to Baidu historically, the China Online Search Marketing Survey Report (PDF) in 2005 found that more people were searching at Google for web results, reference info, shopping, and business material than at Baidu. Baidu’s big search area was downloadable music. Similarly, a Keynote study in 2006 found that Google beat Baidu in many customer satisfaction areas, including general search quality, image search quality, and news search quality. But it was Baidu that ranked tops for music search quality.

For further discussion, see related stories on Techmeme.

The New York Times and the Wall Street Journal both report on the IPO and first day of trading for Alibaba.com. The offering was the biggest IPO by any Chinese company and raised an estimated $2 billion. The market capitalization of the company is now nearly $26 billion. Yahoo owns 39 percent of Alibaba Group, the parent of Alibaba.com, and previously said it would buy 10 percent of the available shares. Some analysts believe the stock is overvalued and unsustainable. But that’s what many analysts also said about Google in its early days of trading.

Deborah Fallows, Senior Research Fellow, Pew Internet & American Life Project, has just published a fascinating report detailing the demographics of Chinese internet users. Deb, an American currently living in Shanghai, notes that “there are now an estimated 137 million internet users in China, second in number only to the United States, where estimates of the current internet population range from 165 million to 210 million. The growth rate of China’s internet user population has been outpacing that of the U.S., and China is projected to overtake the U.S. in the total number of users within a few years.”

The implications of this growth are huge, for the Chinese people and everyone else in the world. This should be a must-read report for both searchers and search marketers alike. An abstract of the report, with a link to the full paper, is here.

Last week I had the opportunity to present some very preliminary results from our Chinese eye tracking study to a Chinese audience at Search Engine Strategies Xiamen. We’re still going over the results and preparing a final report, the highlights of which I’ll cover in this column in a few weeks. What I did want to do in today’s column is talk about our findings at a higher level. Doing this research made me realize that the typical user experience in one part of the world is not necessarily a typical user experience in another. Best practices don’t always transfer cleanly and neatly from one culture to another.

A Chinese puzzle

One of the reasons we decided to undertake the study was that China presented a puzzling situation. The juggernaut that is Google in North America has struggled in China. The homegrown competition, Baidu, has a 62% market share. Google has a 20% market share. And Google seems to be struggling to grow its market share. In fact, it’s been slipping single Google’s introduction into the market. I said before in this column that when it comes to the Western search experience, Google seems to represent the gold standard. In all our eye tracking work, Google has consistently presented a better user experience than either Microsoft or Yahoo. We wondered if the same was true in China? Did the Golden Triangle hold from one culture to another?

We conducted the study here in Canada with students who had recently come over for China to study English as a second language at a local university. We worked with Pavan Lee from Microsoft, a Chinese citizen currently working in the US, to make sure that we structured the study in a way that was sensitive to the Chinese culture and also to help us interpret the findings. It was a unique challenge to interpret eye tracking results when you have no idea what the content is that your subjects were interacting with.

In summary, we did the study and found that the scanning patterns are significantly different in China and that by all the metrics we use to judge user experience with search in North America, Google provided a significantly more relevant search experience than Baidu. I went over to China to present these preliminary findings, smug in my knowledge that we had some significant difference and ready to drop a bombshell that there was an inherent contradiction in the Chinese search market. Google provided a better user experience and, according to Western wisdom, it should be only a matter of time before this prevailed and Google’s market share started to climb. But like most things that translate from west to east, there are hidden levels of complexity here and the answer is not as plain as it might seem. As I talked to people in the Chinese Internet industry and saw for myself the Chinese culture, I realized that the Google metric for a successful user experience might not necessarily be the Chinese metric.

East meets west via the internet

First, I think we have to understand the basic philosophical difference between North America and China when it comes to interacting online. In the West, we become blasé about the level of information that’s available to us. In fact, it’s become a nuisance to many of us. We resent the amount of information we have to wade through to get to what it is we’re looking for. Excess information is something to be identified and quickly discarded, allowing us to zero in on exactly what is relevant to us at the given time.

I’m not sure the same is true for China. I believe Chinese online users approach content in a different way. For them, information is something to be treasured and browsed through. For a Chinese user, a page full of search results does not represent a nuisance to be dealt with. It represents a world of new opportunity that they never had before. A Western user would throw their hands up in alarm at a Baidu results page and the amount of affiliate spam and irrelevant results that they would be faced with. For the Chinese user, perhaps this isn’t a negative experience.

I think the difference in approaches to the Internet can best be summed up in a conversation I had with Deb Fallows, a US ex-pat currently living in Shanghai with her husband, journalist Jim Fallows. Deb sums it up this way. For the Westerner living in China, Internet access is a rather spotty thing. Any online browsing you do is constantly punctuated with denial of access to censored content. The access itself isn’t as reliable as it is in the West, with slower load times and more intermittent service. I noticed this when I was trying to access the Internet from my hotel room in China. For us, the Internet experience in China is definitely a glass half empty. But for the Chinese, the sheer fact that they can access any information at all is a tremendous leap forward from where they were. There’s an explosion of new opportunities that are presented to the Chinese and for them, any access to online content is a glass half-full. The same seems to extend to Chinese search experience.

Hot and noisy in China

Here’s another example of the difference in the online user experience between the two cultures, and the danger that comes when Westerners try to interpret the Chinese online market through our own eyes. Chinese websites tend to be loaded with graphics that blink, spin and scream at us in bright colors. To Western eyes, a native Chinese webpage is often an abomination in design, completely amateurish and awkward. Our assumption is that the design is this way because of the lack of maturity in the Chinese market and the fact that they haven’t progressed enough to adopt Western design standards. It’s like the Wild West days of the Web back in 1995 and 96.

But the fact is, the Chinese prefer a presentation is loaded with visual stimuli. They even have a word for it. Renao. Loosely translated it means “hot and noisy.” If you visit China, this manifests itself around every corner. In the cities, commercial ads scream for attention. A walk down the street is a sensual assault, a tsunami of stimuli that hits you on multiple levels. It’s not necessarily that the Chinese market is less mature than the West; it’s that what the Chinese user wants is not always the same as what the Western user wants.

As I said, as we finalize the report will be sharing the actual findings with you here in the Just Behave column on June 15. What I’m hoping to do in the next two weeks is talk to a few more people who have a better understanding of the Chinese culture and online market than I do to try to put more context around the findings. At this point, the findings are puzzling, but after a very brief glimpse into China, I’m finding that this tends to be the rule rather than the exception when Westerners try to understand China at any level.

Gord Hotchkiss is CEO of Enquiro, a search marketing firm that produces search engine user eye tracking studies and other research. The Just Behave column appears Fridays at Search Engine Land.

Attendees of Search Engine Strategies conferences in North America and Europe know that the searcher behavior panel has grown into one of the most popular sessions of the show. No surprise why: sophisticated search marketers have mostly mastered the tactical aspects of their craft, and in looking for a competitive edge turn to one of the least-understood variables of the overall search marketing equation—the needs of searchers and how best to satisfy them.

The Searcher Behavior panel at SES China offered some of the first research ever done looking at the needs of Chinese searchers. The results were fascinating, and in some cases surprising. While Chinese searchers shared many characteristics of western searchers, their behavior was also quite different—sometimes dramatically different—from their counterparts elsewhere in the world.

Gord Hotchkiss of Enquiro kicked things off by presenting findings from a new eyetracking study on the behavior of Chinese-speaking users who completed search tasks on market leading engines Baidu and Google China. In a nutshell, Enquiro found that Chinese users interacted with search results in vastly different ways than western searchers. Gord plans to write up a report of the study and its findings for Search Engine Land very soon, so I won’t steal his thunder. Keep an eye on the Just Behave column in June for the full details.

Deborah Fallows, senior research fellow of Pew Internet & American Life Project, has been living in China for the past eight months (see her hilarious At Home in Shanghai, a week’s worth of diary posts on living in China).

Deb has done several studies for Pew focusing on the user perceptions and attitudes of American searchers. She’s continued this work in China, attempting to understand who Chinese searchers are and they are and how they use the internet. Unlike Enquiro’s eyetracking research which looked at behavioral responses to search results, Deb’s research is based on user perceptions and attitudes. Using data from the China Internet Network Information Center (CNNIC—the state network information center of China), and Guo Liang, a Chinese researcher at the Academy of Social Sciences in Beijing, Fallows has assembled a fascinating portrait of internet users in China.

Contrary to the U.S., search is not one of the most common online activities in China. What are the most popular activities for Chinese internet users?

Get news – 93% Surf the web – 86% Listen/download music – 85% Play online games – 84% Use email – 69% Instant messaging – 67% Use search engine – 63% Research products & services – 63%

These activities are very different than the most common activities of U.S. internet users:

Use search engine and email – tied at 91% Find health info – 79% Check the weather – 78% Get travel info – 73% Get news – 67%

“While searching is important, there are other things on the internet that [Chinese] users will do,” said Fallows.

Popular activities don’t always equate with the types of things users spend the most amount of time doing. What online activities do Chinese users spend the most time doing?

Emil – 56% News – 54% Search – 52% Getting information (products, health services, gov etc) – 41%

This suggests that although search isn’t one of the most popular online activities, it’s still something that Chinese users spend a lot of time doing (indeed, Enquiro’s research found that Chinese searchers using Baidu spent two to three times or more longer examining search result pages than U.S. based searchers).

Deb thinks that Chinese users enjoy interacting with search engines. “People are very engaged with search engines on the Chinese internet, as much as anything as they do. And it’s something that will probably increase as time goes on,” she said.

What about the actual duration of time spent with search engines each week? Deb offered the following stats from the CNNIC January 2006 “17th Statistical Survey Report on the Internet Development in China.”

2.2 hours searching for work or study info 2.0 hours doing email 1.7 hours searching for personal hobby info .9 hours playing online games .9 hours reading news .7 hours chatting

These numbers are significant, as the average Chinese internet user spends 15 – 16 hours per week online.

“In the U.S. we’re used to people searching frequently, but we’re not seeing them spend a lot of time on search engines,” said Fallows. One possible reason that users are spending so much time searching is that they’re not finding relevant results as quickly as U.S. searchers. Deb also suggested that it could be due to slower internet connections that cause downloads of search result pages to take longer.

“People spend a lot of time on search results. I also suspect that there’s a lot more hanging around on discussion boards to discuss the results that they get,” said Fallows, noting a feature found on Chinese search engines that’s typically not present on U.S. search engines.

How about popular topics? By category, Chinese users sought out:

Entertainment – 68% Work or study information – 56% News – 43% General knowledge – 43%

“This underscores that the state and interest of the internet in China is very heavily geared toward entertainment,” said Fallows.

How successful do Chinese searchers consider themselves to be when it comes to finding information on the internet?

14% say they usually find what they’re looking for 56% say they often find what they’re looking for 30% say they sometimes find what they’re looking for.

These findings mirror what Pew has found in the U.S. “This is a very strong result. That means that they have a pretty good sense of themselves as searchers and consider themselves successful,” said Fallows. However, “People have an inflated sense of themselves as searchers. Maybe people think of themselves as better than they actually are. They don’t really know how to handle search engines that well.”

Deb has an optimistic view of the future of search in China. “Search engine use will be increasingly popular,” she said. “People will search for more topics. Time is on the side of search engines and search engine users. People will search more and they will get better at it,” she said.

Deb concluded by offering a tip for search marketers in China trying to connect more effectively with prospects. “Try to think of yourselves as an internet user, because most of the people using the internet don’t have nearly as much sophistication as you do,” she said.

Next, Tony Fu, Research Director for Data Center of the China Internet presented findings from data collected in 2007 survey, trying to understand the opportunities for search advertisers in China. Fu spoke rapidly in Chinese, and the translators seemed to miss or garble most of his points, so I’ll try to report what I gleaned mostly from looking at his powerpoint slides.

Fu said that the search engines face a dilemma in China. They have more users than the popular portals (Sina, Tom.com et al), but portals currently have greater advertising revenue. So there’s a big opportunity for search engines to capture some of that online advertising spend, if they can figure out how to connect more effectively with their users.

The usage overlap with users of search engines and portals is 100%, but Fu believes that search engines have greater potential, and he foresees an evolution as users migrate away from portals and toward search engines, a pattern that played out in the U.S. in the late 1990s and early 2000s.

Fu thinks the current problem is that search engines aren’t tapping their full potential. He says they haven’t established effective ad measurement systems yet, especially when compared with the data provided to TV and newspaper advertisers in China.

Fu said that search engines have the advantage over portals going forward because search engine users tend to be more loyal than portal users. Furthermore, newcomers to the internet in China tend to start out with a portal, then migrate to a search engine as they become more comfortable navigating cyberspace.

The findings presented by all three speakers were fascinating, but only underscored how little is really known about searchers in China. Hopefully, all three of the panelists will continue this important work in understanding the mind of the Chinese searcher.

Reporting from the Fourth Annual Piper China Growth Conference, analyst Safa Rashtchy says that China-based search engine Baudu continues to dominate in market share for both organic and paid listings, but apparently Google’s increased investments in China are paying off. Baidu also believes the opportunity in Japan will be significant longer term and they believe they have local market advantage vs. U.S. players. Video sharing sites are also seeing strong momentum, though there is no clear leader in China as yet.

Yahoo China is transforming itself into a business-oriented search engine, in part to deal with crushing competition from Baidu.com and portal Sina.com. “If Yahoo is going to win, it has to do so in a new way,” said Jack Ma, CEO of e-commerce company Alibaba Group, which runs Yahoo’s China operations in an interview with The Associated Press in China.

Baidu is the search king in China, with nearly 64% market share, according to a recent Wall Street Journal article. Yahoo China has just an 8% share, after Google China’s 19% share.

The move comes little more than a year after Yahoo transferred its China operations to Alibaba, taking a 40% stake in the company.

Forbes reports that China Mobile and Google will be launching a mobile search service in 2007. The details are very fuzzy right now, all we know is that a China Mobile representative said something to the effect that they “begun developing their joint mobile search product for launch in 2007.”

This comes a week after Google partnered with Taiwan’s Chunghwa Telecom and surprisingly also after Google just said they wouldn’t be seeking local partners to grow market share in China.

Postscript January 4, 2006: Google posted the press release just today.

In Google sticks to solo plans from the Shanghai Daily, Google said it won’t work with a local partner in China to gain marketshare. Google’s vice president of China operations, Kai-fu Lee said that they “have confidence in our current approach” in China.

Currently, Baidu has 50 percent share in China, compared to Google’s 16 percent share, according to one estimate. Baidu’s share is expected to increase, while Google is expected to remain flat.

Yahoo has made partnerships in China to try to expand their reach, with the Alibaba.com investment. Note that Google did announce a partnership deal with Taiwan’s Chunghwa yesterday.