OPINION> Commentary
Guard against Net monopoly
(China Daily)
Updated: 2008-11-13 07:47

The case filed against the Internet search engine Baidu challenges the current anti-monopoly law in China, says an article in the Beijing News. The following is an excerpt:

China's first case against Internet monopoly has recently been exposed. An information company in Tangshan, Hebei province, filed a case against the website ranking service offered by Baidu, the leading Chinese language search engine. Baidu is accused of removing websites off its search engine at its own will. The Hebei company requested the Administration of Industry and Commerce to investigate into Baidu's abuse of its monopoly position in the market.

The litigation against Baidu shows the contradiction between the rapid growth of Internet technologies and lagging checking systems.

Earlier, the runners of other websites such as Taobao banned the usage of Baidu's search engine robots to express their anger at its website ranking service.

Later, Sanlu, the Hebei-based dairy company that was accused of making toxic baby milk power, reportedly asked Baidu to screen reports about the scandal on its website. Baidu has been increasingly criticized by the market about its inappropriate choice between commercial interests and ethics.

However, these boycotts and public criticism have not had strong enough impacts to challenge Baidu's leading positions in the market. Still, Baidu has an unparalleled position in China's search engine market. According to a latest survey, Baidu has 60.9 percent market shares in big cities like Beijing, Shanghai and Guangzhou, while Google, Sogou, and Yahoo occupy 27 percent, 3.1 percent and 2.4 percent respectively.

Due to Baidu's wide market coverage, its website ranking service has become an important type of online marketing for many domestic companies. But the positions between the supplier of this service and the users are unequal. Baidu has decided everything about this service including the bidding methods and the down payments while the users have little room to negotiate with Baidu. Once disputes arise, Baidu can use its technologies to screen these users on the Internet, causing additional costs for users.

The abuses of market monopoly should be subject to the punishment of the law. However, the Internet industry is different from traditional industries in terms of the standards for judging whether an anti-monopoly case can be validated. The newly born Anti-monopoly Law has yet to include the terms on Internet malpractices.

It is noted that the legal restraint can of course fuel hopes for those who are hurt by the monopolistic behaviors, but preventative regulations and timely intervention seem to have better effects than laws.

Government departments concerned can organize talks between Baidu and users of Baidu's much- criticized website ranking service in an equal manner, clarifying the rights and responsibilities of either side. Meanwhile, the regulators should investigate into the rumored screening of Sanlu's milk power news by Baidu, revealing the truth to the public.

The first ever litigation against Internet monopoly shows that the awareness of protecting users' rights is on the rise, which not only helps improve the anti-monopoly law, but also reminds the government of the necessity of putting a preventative check on those new technologies.

(China Daily 11/13/2008 page8)