China Telecom gives Google Web advertising rights

SHANGHAI (Reuters) - China Telecom Corp. has given Google Inc. the right to offer advertising on over 400 Web sites owned by the Chinese firm, the companies said on Wednesday.

The deal covers national and local portals operated by China Telecom, the country’s biggest provider of fixed-line telephone and Internet services.

China Telecom aims to boost its online advertising business and provide higher value-added services through the tie-up with Google, the companies said in a joint statement.

Li Kaifu, president of Google China, was quoted as saying the deal gave the U.S. company broader opportunities to develop in China, the world’s biggest Web market by users after the United States.

The statement gave no financial details.

Google is battling in China’s Internet search market with local leader Inc., which had a 58 percent share in the fourth quarter of 2006 against 17 percent for Google, according to research firm Analysys.

Last December, Microsoft Corp. announced an alliance with Baidu under which the Chinese company would sell advertising for MSN and other Microsoft-operated Web sites in China.