China Conundrum: Google, MySpace Look For Solutions

Solve the China conundrum and a company could be assured of substantial growth for years to come. Fail, and the cost is dear as numerous companies have learned to the dismay of execs and shareholders. Some of the latest moves:

Reuters: MySpace launches test in China“: A locally owned, operated and managed company is now live with a test site as News Corp. tries to avoid repeating others’ mistakes. The venture is backed by MySpace Inc., publisher IDG and China Broadband Capital Partners L.P., a fund operated by Edward Tian (former chief, China Netcom Group). Fund exec Luo Chuan, former head of MSN China, is CEO, MySpace China. No details on how equity and investment were divvied up.

Sage Brennan, MKTW: “China is just different.” We hear this incessant refrain from all sides, but few companies have been willing, in the end, to withstand the top-of-the-roller-coaster dread of passing the reins to local management. … News Corp. investors will benefit if Luo gets the freedom to strike strategic partnerships with, or even acquire other local firms. Popular video site Tudou.com, one of many potential examples, is backed by the Chinese venture capital arm of International Data Group, which conveniently occupies a seat on MySpace China’s board.”

AP: Google Aims to Expand China Market Share: In Beijing Friday, Google CEO Eric Schmidt said Google is gaining market share but didn’t offer details, according to AP. “Schmidt said Google plans to give its China operation, led by Kai-Fu Li, a former Microsoft Corp. vice president, greater autonomy to develop new products and respond to the local market. … Asked for details, he would say only that it involved more decision-making power.” Google’s failure to offer Gmail is a flaw to some analysts; Google is trying to avoid the trouble Yahoo ran into with government demands for copies of email.

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