iResearch’s 2008 2nd quarter China’s search market

My last post on the iResearch survey can be found here:

http://chinese-net-gaming-stock.blogspot.com/2008/03/iresearchs-china-advertising-market.html

But that survey is not on China’s search market. Yesterday, it published a survey on the 2^nd quarter 2008 China’s search market. It can be found here:

http://www.iresearch.com.cn/html/consulting/search_engine/DetailNews_id_82891.html

Some basic result:

- China’s search market in 2Q2008 is $183 million dollars. It represents a 35.8% quarter over quarter growth and 96.7% growth year over year.

- Baidu has 62.8% of market

- Google has 26.2% of market

- Yahoo has 7.9% of market

- Sogou has 0.9% of market

- Zhongsou has 0.8% of market

- Sina has 0.3% of market

- Netease has 0.3% of market

It is interesting that a survey would be published right before all the Chinese companies would announce its 2^nd quarter earning. Either this survey is right or wrong. If it prove to be wrong from the upcoming earning announcements, iResearch is probably not a very good source of information. If it proves to be right, we would have a great source to know how the companies do just a few weeks before the earning announcements.

The following table gives the official 1st quarter result, the 2nd quarter estimate from iResearch, and the % increase quarter over quarter:

	1Q2008 search rev.	2Q rev. (estimate)	% increase
Baidu	81.7	114.9	40.6%
Sohu	1.6	1.65	0.3%
Sina	?	0.55	?
Netease	?	0.55	?

It predicted a search revenue for Baidu of 114.9 million for 2Q2008. Adds other revenue of about 0.2 million, we would have total revenue of $115.1 millions. It compares favorable to the average analysts estimate of $112.27 millions. If iResearch is right, we shall be a nice pop to Bidu’s stock price right after they announced their 2^nd quarter earning.

On the other hand, if iResearch is right, then Sohu’s Sogou is rather disappointing. It is so close to the Olympics and you would think Sogou would have gain since Sohu is an official Olympics sponsor and the producer of the official Olympics web site.

For Sina, they gave up on search already. For Netease, they might as well.

For course, I have no idea how accurate is iResearch. I will do a follow-up after all the companies announced their 2^nd quarter earning.