By Paul Carsten
BEIJING, July 15 Google Inc said on
Monday that its vice-president and Greater China president, Liu
Yun, has stepped down to pursue other opportunities.
His replacement will be Scott Beaumont, who currently runs
the company's partnerships business in Europe.
Google's share of the search engine market in China has been
slipping, spurred by its decision to no longer censor its
searches on the mainland and move its servers to Hong Kong in
March 2010, just months after Liu took over.
Google held 8 percent of market in terms of page views in
June 2011, coming second to Baidu with 81 percent,
according to Chinese data firm CNZZ. Its share has fallen 6
percentage points over two years according to last month's data,
dropping to fifth place. New entrant Qihoo 360 already
holds 15 percent of market share.
"Once they made the decision to move their servers out of
mainland China their prospects here dimmed considerably," said
Mark Natkin, managing director of Marbridge Consulting, a China
technology research firm.
Google's Android operating system has also proven difficult
to monetise, despite its success in terms of take-up in China.
For the three months ending in April this year 69 percent of
all smartphones sales were on the Android system. Phones using
Apple's iOS, Android's closest competitor, made up 25
percent of sales in the same period, according to data from
Kantar, a market research group.
The ways the company usually monetises Android, like its app
store, often get stripped out of the software in China when it
is remade for the local market, said Natkin.
The prevalence of Android in China drew the ire of its
political system in a March report by the state-controlled think
tank China Academy of Telecommunications Research, which
operates under the Ministry of Industry and Information
The report said that Google had too much control over
China's smartphone sector, which had become dependent on
Android, and had discriminated against certain local firms.
The paper suggested that the government would throw its full
support behind a viable domestic challenger to Google.
"Google's biggest challenge remains how to penetrate China,"
said Elinor Leung, Hong Kong-based head of Asia telecom and
internet research at CLSA.
"Their servers have been moved to Hong Kong and their
Android operating system has been localised," she said, adding
that Liu's departure and the arrival of Beaumont would likely
have little impact.