China Mobile and Xinhua plan to build Google rival

China Mobile and China's state-run Xinhua News Agency have signed an agreement to establish a new Internet search engine company, Xinhua reported on Thursday. The joint venture will seek to build a leading search engine for China and develop other businesses related to the Internet, publishing and advertising, the news agency reported.

"Search engines, which have powerful information integration abilities, play an increasingly important role in disseminating information and influencing public opinion," Xinhua Vice President Zhou Xisheng was quoted as saying. The partnership will help China "to safeguard its information security and push forward the robust, healthy and orderly development of China's new media industry," he said.

China's search market is dominated by the Chinese company Baidu, which controls a 70 percent share, according to Analysys International. Google ranks in second place with 24.2 percent of the market.

It was unclear if the joint venture is geared towards desktop or mobile search. The project could be simply meant to perform mobile searches on the contents of Xinhua, said Liu Ning, a principal analyst with technology consultancy BDA. If it is for desktop search, "I don't think they have any really strong resources that can help them compete with a leader player like Baidu or Google," he added.

The two companies are calling the joint venture "Search Engine New Media International Communications Co."