The wireless service in China began to take off last year and it will experience a breakthrough this year, especially as the industry is waiting for the issuing of the 3G licenses, said a senior analyst at Shanghai-based iResearch. Larger screens in the 3G handsets would boost demand for a search engine service. Google has done a great job in the United States in the wireless search engine business and I think the product would also be popular in the mainland.

Baidu was left with no choice but to co-operate with China Unicom, while Google has the obvious advantage here in China as China Mobile has many more users. Baidu launched a search engine service for several of Nokia's handset models last year, with four popular services - Web search, news search, image search and Baidu post bar - being provided. Google announced last month that it would offer China Mobile users with a mobile search capability via Monternet, a mobile Internet platform developed by China Mobile.

China Unicom signed up 930,000 new subscribers to its GSM network last year, bringing the total to 105 million. Subscribers to its high quality, low-radiation CDMA network number 36 million. The company reported a turnaround in its CDMA business in the first half of 2006, posting a pre-tax profit of 295 million yuan ($37.6 million), compared with a pre-tax loss of 482 million yuan for the same period in 2005.

The possible partnership between Baidu and China Unicom for a mobile search engine service is widely believed to be a win-win deal for both companies, and it will also pose a formidable challenge to Google and China Mobile in the promising but competitive Chinese mobile search market.

 
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