Amid privatisation rumours, Qihoo 360 eyes overseas expansion through Hong Kong deal
Qihoo 360 Technology, mainland China's biggest internet and mobile security software provider, aims to further build up its internet search business through a global advertising operation in Hong Kong.
"This move signifies our commitment to further developing our business in overseas markets," Qi Xiangdong, the co-founder and president of Qihoo 360, said on Thursday.
Headquartered in Causeway Bay, QS Search was recently appointed by Qihoo 360 to serve as the firm's global advertising arm in Hong Kong. It will provide sales, marketing, consulting and technical support services for Qihoo 360’s online advertisers worldwide.
"Hong Kong is a strategic location with a well-established free economy, a high level of productivity and efficiency, and a pool of great bilingual talent for best servicing international brands and advertisers, as well as major advertising and marketing agencies in this region and all over the world," said David Ip, the global business advisor at Qihoo 360.
Ip said that companies based outside of mainland China would find it easier to connect with the country's enormous consumer market through the company's flagship search engine, Haosou.com, as well as its 360 Personal Start-up page and mobile app store.
Haosou is the second most-popular online search engine in mainland China, but lags far behind market leader Baidu. According to consultancy iResearch, Baidu controls an estimated 81.6 per cent of the market in terms of online search revenue, with Qihoo 360's offerings at 2.8 per cent, behind US internet giant Google (10.3 per cent) and Sohu.com's Sogou search engine (4.3 per cent).
Ip said that Qihoo 360's efforts to ratchet up its overseas expansion would enable the company to seize market share away from both Baidu and Google.
Among the early enterprise customers for Haosou in Hong Kong are FXCM, a US-based online foreign exchange market broker, and popular cosmetics retailer Sa Sa International.
Working with Qihoo 360 has helped boost FXCM's brand awareness and exposure across Greater China, said Ashley Chun, the Asia-Pacific director of marketing at FXCM.
Remus Li, vice-president for e-commerce at Sa Sa, said the cooperation with Qihoo 360 would "focus on online-to-offline (O2O) initiatives and mobile advertising".
Government data showed that the total number of mobile internet users in mainland China reached 857 million at the end of December, driven by the fast domestic adoption of 4G and 3G data services. Mainland China is also the world's biggest smartphone market.
"Qihoo 360 is aiming to not only grow Haosou.com's market share, but also expand the overall mobile search sector in the coming years with solid, innovative products and services," Ip said.
Ip declined to comment on New York-listed Qihoo 360's potential privatisation, but said such a move would not have any impact on the company's online business activities and global expansion plans.
A consortium led by Zhou Hongyi, the chairman and chief executive of Qihoo 360, last week made a US$9.6 billion offer to take the company private.
This week, the US Securities and Exchange Commission sued Haijan Luo, the chief executive at Chinese gaming company 4399 Co, for allegedly profiting from insider trading activity on trades he made last week on Qihoo 360 shares ahead of the company’s announcement about the privatisation offer.