China pursues a very strict Internet policy where foreign companies are only allowed to operate in the country provided they adhere to Beijing’s censorship norms. As a consequence, Chinese citizens are left with no choice but to keep using local search engines like Baidu that have been criticized for providing substandard services.
Baidu’s market dominance
A capitalist free-market economy that promotes competition creates an environment where companies seek to provide the best possible service to customers since their entire existence is dependent on positive responses. Any economy that puts restrictions on fair competition will end up empowering a few companies so much that they will no longer feel the need to ensure customer satisfaction. Since they are monopolies and sole providers of the service, people have no other choice. This is what is happening to the search engine market in China.
Beijing’s stipulation that search engines comply with their strict censorship norms has pushed Google out of the market. Local companies like Baidu rule with almost zero competition. As such, Baidu feels no need to invest too much in improving its search engine since people are guaranteed to use it for lack of alternatives. What’s worse is that the guaranteed market monopoly encourages Baidu to implement policies that would not be possible in a competitive market.
For instance, a university student who suffered from cancer died in 2016 after he used a questionable treatment he had discovered through a Baidu search. An investigation later found that Baidu was intentionally placing paid medical advertisements at the top of the search results without checking whether the ads were genuine. However, the incident failed to affect the company in any significant way and Baidu continued with business as usual.
Recently, a Chinese journalist posted an article titled “Search engine Baidu is dead” on social media. “The author blasted Baidu’s media aggregation service for highlighting unreliable information and its own products and services in its search results. He accused the company of ceasing its mission as a search engine but rather striving to become a marketing platform aimed at making money through traffic from users searching for content,” according to South China Morning Post.
Baidu corners about 71 percent of the search engine market in China. In second place is Shenma, with a market share of just about 15 percent. Sogou and Haosou come in third and fourth places with 4.6 percent and 3.8 percent market shares respectively.
A separate Internet
Many tech experts believe that China’s Internet censorship policy will eventually create a separate Internet. Eric Schmidt, the former CEO of Google, warns that as China increases its tech dominance overseas, these censorship policies will also be implemented in other nations. “I think the most likely scenario now is not a splintering [of the Internet], but rather a bifurcation into a Chinese-led internet and a non-Chinese internet led by America,” he said in a statement (CNBC).
A “separate Internet” is vastly different from a “restricted Internet.” China currently follows a policy of “restricted Internet” in which it blocks citizens from accessing certain foreign websites using firewalls. However, people can still use VPNs and other tactics to access these blocked websites, though at the cost of getting arrested by authorities.
In a “separate Internet” scenario, the entire Internet infrastructure implemented would be completely isolated from other networks. As such, there would be no chance of connecting to websites not sanctioned by the government since these websites would not even exist in the Internet network used in the country.