Recruiting in China

People visit UCWeb's stand to try out its mobile browser at a mobile Internet trade show in Beijing.

Browser firm UCWeb forms Shenma Inc in joint venture with Alibaba

UCWeb Inc, a leading Chinese browser maker and app distributor, has formed a joint venture with China's e-commerce conglomerate Alibaba Group Holding Ltd to offer a mobile search service, a move that may become a threat to search giant Baidu Inc.

The Beijing-based UCWeb said on Monday at a ceremony celebrating the 10th anniversary of its founding that the mobile search joint venture will be called Shenma Inc.

The budget for the joint venture was not revealed, but UCWeb confirmed that it owns roughly 70 percent of the mobile search company.

Yu Yongfu, chief executive officer of UCWeb, said the time is ripe to enter the market as the booming mobile Internet offers his company a great chance to reshape its brand. "Mobile messaging, mobile search and mobile browsers are the three key demands in the era of mobile Internet," he said.

"Since no one company has established a dominant position in mobile search, we believe we enjoy a unique advantage to build Shenma into becoming No 1 in mobile search."

According to iResearch Consulting Group, the mobile search market will be worth $1.3 billion this year and $2.5 billion next year. Baidu currently leads the field due to its established position in the PC-based search engine sector.

Baidu saw its first-quarter revenue soar 59.1 percent year-on-year to 9.5 billion yuan ($1.53 billion).

Robin Li, Baidu's founder and chief executive officer, said during a first-quarter earnings conference call that traffic on Baidu's mobile search app should surpass personal computer-based search traffic this year.

Despite Baidu's solid performance, Yu said UCWeb has great advantages in mobile search as his company has built its business on the mobile browser.

"The design of mobile search should be mobile-centered rather than personal computer-based," he said.

Yu said that text-based search requests will be reduced in the mobile Internet era. More and more search requests are expected to be made through voice or even images.

According to the company's statement on Monday, UCWeb has integrated Alibaba's search department into Shenma and hired a team of experts from China's search giant Baidu Inc as well as Google Inc.

Lu Jingyu, an analyst with iResearch, said that as a mobile browser provider with more than 500 million users across the globe, the UCWeb browser can help Shenma wrestle market share away from Baidu.

"Moreover, by integrating with Alibaba's system, it is expected that people will search for and purchase products from Taobao.com and Tmall.com. The merchants on the two e-commerce platforms of Alibaba all can become potential advertisement buyers of Shenma," she said.

But Shenma still has a long way to go if its goal is to surpass Baidu as a mobile search giant in China, said Lu. "As none of Shenma's unique features have been released yet, I can see the emergence of a strong competitor but not a dominator," she said.