NetEase may help Google to launch app store, return to China

PUBLISHED : Tuesday, 07 February, 2017, 6:32pm
UPDATED : Tuesday, 07 February, 2017, 10:40pm

Google is in talks to make its Google Play application store available in China, taking the first step since 2010 to return at least some of its services to the world’s largest market for mobile phones and internet services.

NetEase, China’s second-largest operator of online games, has approached Google about forming a venture to launch Google Play in China, The Information reported, citing people familiar with the discussions, without identifying them. Google’s spokesperson in Hong Kong declined to comment, while NetEase officials did not immediately respond to requests for comment.

Talk had been swirling for years in internet circles about Google returning parts of its business to the world’s most populous market, ever since it withdrew its search engine from China after clashes with Chinese censors over search results, and following a 2010 cyberattack on users of its Gmail email service.

Google needed a Chinese partner that could help it navigate the intricacies of operating in China, Alphabet’s chairman Eric Schmidt had previously said.

“Partnering with Google to launch the Google Play store in China means that NetEase can also launch its apps in the store to gain traffic and user base,” said Kitty Fok, managing director for IDC China.

Google Play will still have to abide strictly by the Chinese government’s censorship rules, she said.

Google Play surpassed Apple Inc’s App Store in 2013 as the world’s largest market place for obtaining mobile applications, with 2.2 million apps published and 50 billion downloads, according to

Still, the developer of Android-based apps will have a lot to catch up on in China.

China’s most popular store for downloading mobile applications is MyApp, run by the country’s largest operator of social network and online games, Tencent Holdings, according to market intelligence company Newzoo.

Mobile Assistant by Qihoo 360 Technology, the online security and utility company, is second, while app stores by Baidu and Xiaomi are third and fourth, Newzoo said.

“Google and NetEase face the challenge of having to convince device manufacturers to pre-install the Chinese version of Google Play on smartphones in China to gain market share,” Fok said. “Google Play already has the largest number of global apps in its store internationally. The joint venture could also help more Chinese developers make their apps available to international users of Google Play.”

This isn’t Google’s first attempt to return to China.

Sogou, China’s third-largest internet search engine and a unit of Sohu Inc, was discussing a partnership with Google, whereby the US company would use its algorithm to conduct the searches, while Sogou will screen the search results to comply with China’s censorship rules.

Although Google has not provided its services to users in China after its departure in 2010, the company maintains offices in Hong Kong and Taiwan, where it sells digital advertising to Chinese companies who wish to advertise internationally.

Google is also in constant dialogue with Beijing as the company seeks to eventually re-enter the Chinese market, Schmidt said previously.

Google co-founder Sergey Brin also previously stated that certain units of Alphabet, as Google’s holding company is called, may return to China, hinting at the company’s ambitions to once again operate in the country.

Google also partnered with Chinese telecommunications and device manufacturer Huawei in 2015 to produce its Nexus 6P smartphone, a move that industry insiders suggested could soften China’s stance towards the US company.