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Recent reports suggest that Google-parent Alphabet, Inc. (GOOGL - Free Report) is planning to expand in China. Although Google’s core services, Google Search, Gmail and YouTube, remain blocked in China, the company is involved in providing digital tools and support to large a number of Chinese app developers and manufacturers, mobile companies and advertisers, who want to reach out to their global customers.
Google had pulled out of China eight years ago over censorship issues. However, if reports are to be believed, Google now plans to re-enter the China market. For this, Google is reportedly planning to launch a censorship-friendly mobile search engine, wherein its Chinese partners might play a key role in its efforts to expand in that country. However, there are challenges aplenty for Google in China, which the company needs to overcome.
Google Takes Alternate Approach
Although Google’s core services, Google Search, Gmail and YouTube remain blocked in China, the company has played a key role in supporting local tech companies. Google provides digital tools and support to a large number of Chinese app manufacturers, developers and advertisers, who want to reach out to global customers.
Google decided to pull out of China in 2010 over censorship issues. However, it has been providing its digital services and tools to many local companies. Reportedly, the company now plans to re-enter the China market and launch a censorship-friendly mobile search engine codenamed Dragonfly.
Local Partnerships Hold the Key
Understandably, for Google, partnerships with these local companies will play a key role in convincing the Chinese government to let it expand in China. Google can cite that such partnerships have been helping the Chinese economy to grow.
Moreover, such local partnerships could result in Google providing customers its other services such as cloud computing and other business apps, thus helping its business to grow in China. Google recently invested $550 million in Chinese e-commerce giant JD.com, Inc. (JD - Free Report) for a 1% stake.
Also, in July, Google launched an Artificial Intelligence (AI) game on WeChat. In January, the company signed a patent cross-licensing agreement with Tencent Holdings Limited (TCEHY - Free Report) to expand its presence in China. Alphabet carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Challenges Galore for Google
Understandably, this move comes at a time when growing customer and subscriber base has become a priority for big tech companies, especially after slowing user growth has started hurting these companies. Shares of tech giants such as Facebook, Inc. and Netflix, Inc. (NFLX - Free Report) recently took a hit after the companies reported slowing user growth in their quarterly results.
Re-entering the China market won’t be that easy given the strict regulations the Chinese government imposes on Internet companies. China has more than 770 million Internet users but most access it with the help of a device running Google’s open source Android operating system.
However, China has been actively encouraging local tech companies that have seen the rise of search engine giant Baidu, Inc. (BIDU - Free Report) and e-commerce behemoth JD.com. Also, Baidu’s popularity has grown on the vernacular quotient. This certainly will raise competition for the company. Google has been focusing on this area and launched a Google Translate App in China in 2017. Recently, it also added a file management app to its local Chinese app store.
That said, before Google launches any such app, it would require approval from the Cybersecurity Administration from China along with a clearance from the Chinese government. And the laws have become are a lot stricter than they was eight years ago.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%. And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Image: Bigstock
Can Google Demolish the Barrier to China Reentry?
Recent reports suggest that Google-parent Alphabet, Inc. (GOOGL - Free Report) is planning to expand in China. Although Google’s core services, Google Search, Gmail and YouTube, remain blocked in China, the company is involved in providing digital tools and support to large a number of Chinese app developers and manufacturers, mobile companies and advertisers, who want to reach out to their global customers.
Google had pulled out of China eight years ago over censorship issues. However, if reports are to be believed, Google now plans to re-enter the China market. For this, Google is reportedly planning to launch a censorship-friendly mobile search engine, wherein its Chinese partners might play a key role in its efforts to expand in that country. However, there are challenges aplenty for Google in China, which the company needs to overcome.
Google Takes Alternate Approach
Although Google’s core services, Google Search, Gmail and YouTube remain blocked in China, the company has played a key role in supporting local tech companies. Google provides digital tools and support to a large number of Chinese app manufacturers, developers and advertisers, who want to reach out to global customers.
Google decided to pull out of China in 2010 over censorship issues. However, it has been providing its digital services and tools to many local companies. Reportedly, the company now plans to re-enter the China market and launch a censorship-friendly mobile search engine codenamed Dragonfly.
Local Partnerships Hold the Key
Understandably, for Google, partnerships with these local companies will play a key role in convincing the Chinese government to let it expand in China. Google can cite that such partnerships have been helping the Chinese economy to grow.
Moreover, such local partnerships could result in Google providing customers its other services such as cloud computing and other business apps, thus helping its business to grow in China. Google recently invested $550 million in Chinese e-commerce giant JD.com, Inc. (JD - Free Report) for a 1% stake.
Also, in July, Google launched an Artificial Intelligence (AI) game on WeChat. In January, the company signed a patent cross-licensing agreement with Tencent Holdings Limited (TCEHY - Free Report) to expand its presence in China. Alphabet carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Challenges Galore for Google
Understandably, this move comes at a time when growing customer and subscriber base has become a priority for big tech companies, especially after slowing user growth has started hurting these companies. Shares of tech giants such as Facebook, Inc. and Netflix, Inc. (NFLX - Free Report) recently took a hit after the companies reported slowing user growth in their quarterly results.
Re-entering the China market won’t be that easy given the strict regulations the Chinese government imposes on Internet companies. China has more than 770 million Internet users but most access it with the help of a device running Google’s open source Android operating system.
However, China has been actively encouraging local tech companies that have seen the rise of search engine giant Baidu, Inc. (BIDU - Free Report) and e-commerce behemoth JD.com. Also, Baidu’s popularity has grown on the vernacular quotient. This certainly will raise competition for the company. Google has been focusing on this area and launched a Google Translate App in China in 2017. Recently, it also added a file management app to its local Chinese app store.
That said, before Google launches any such app, it would require approval from the Cybersecurity Administration from China along with a clearance from the Chinese government. And the laws have become are a lot stricter than they was eight years ago.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%. And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>