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TEXT OF STORY
SCOTT JAGOW: About a year ago, Google and Yahoo both took a lot of heat for the way they were doing business in China. Google backed down from the Chinese government and launched a censored version of its search engine. Yahoo handed over the names of people who said unflattering things about China’s government. There’s no doubt the rules are different in China. But the business opportunity is huge. Today, we found out another big name wants to go in: Ask.com. The question is: Will this company take on the Chinese? Alisa Roth reports.
ALISA ROTH: CEO Barry Diller says there’ll probably be a Chinese version of Ask.com within the next two years. And in any case, he’s planning to invest another $100 million in a new Internet business there.
The business of Internet searching in China is a tricky one. And that’s not even taking information control issues into account. Foreign search engines like Google and Yahoo have had a hard time gaining traction in China.
Donald Strazheim is with Roth Capital Partners. He says homegrown competitors, like Baidu.com, have been leaving the foreigners in the dust.
Donald Strazheim: Quite frankly, I’m not sure that it is going to be worthwhile. Baidu is a dominant player over there. They’re going to continue to be a dominant player over there. I don’t know whether Ask.com has a real opportunity there, but Barry Diller surely does. And so let him go have at it.
But what about the controversial question of Internet censorship? Ask.com’s CEO Diller says he plans to play by the rules in China. Straszheim says that’s smart.
Strazheim: China’s a sovereign nation. They’ve got their own rules the way they do business. And foreign companies can either play by their rules or not be involved.
But China is one of the world’s biggest and fastest growing markets for consumers and Internet users. Not being involved there may not be a real option.
In New York, I’m Alisa Roth for Marketplace.
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