Chinese market offers scope for commercialization
Chinese search engine Sogou sees itself as a growing rival to search leader Baidu, as its artificial intelligence (AI) push will pay off with a bigger market share, the company's CEO said on Tuesday.
Sogou is expected to take a slice - 2 to 3 percentage points per annum - out of Baidu's share in the country's search engine market, Sogou CEO Wang Xiaochuan told the Global Times at a media briefing on Sogou's first financial results as a public company.
The NYSE-listed technology company on Monday reported full-year revenue of $908.4 million for 2017, up 38 percent year-on-year. It posted non-GAAP earnings of $105.9 million, an increase of 54 percent.
Wang based his confidence on the company's use of a differentiated strategy that intends to transform its search engine and input keyboards into AI-backed smart personal assistants.
Describing Sogou as essentially a pursuer trying to catch up with Baidu, Xiang Yang, an industry analyst at Beijing-based CCID Consulting, expressed reservations that Sogou's AI push would give it the power to erode Baidu's market share.
In the third quarter of 2017, Sogou held a 22.3 percent share of China's mobile search market, a distant second to Baidu's 41.4 percent, according to Guangzhou-based market research firm iiMedia Research.
Baidu is also betting its future on the AI revolution, and it remains a powerful player in the search market, Xiang told the Global Times on Tuesday.
Domestic companies are scrambling to commercialize AI technologies, with many touting AI-powered software products such as navigating apps and AI-powered hardware devices, he said, warning that it's not easy to monetize such efforts.
Sogou will introduce AI-powered simultaneous interpretation devices this year, adding to its AI hardware lineup of two recently launched translation devices, according to Wang.
The company has set sales targets for the translation devices, but it isn't ready to make those figures publicly available, he told the Global Times.
Similar gadgets are also on the market from Google and iFlytek, among other companies pursuing profits in AI.
Market watchers believe that Chinese companies' aspirations to bring AI technologies into tangible form within the reach of common people will help to sharpen domestic AI companies' competitive edge over their global counterparts, even though Chinese players have yet to reach the equivalent level of global industry heavyweights in absolute terms of technological prowess.
AI-backed translation devices, in addition to smart speakers that appeal to a greater number of users, are among the most readily available ways that domestic companies have of turning AI into proven, everyday technology, Zhang Xiaodong, president of the Wuzhen Institute, an internet industry think tank, told the Global Times on Tuesday.
Although the likes of Google are considered to be pioneers in this realm, the fact that China is widely seen as a more sophisticated market in terms of commercialization paves the way for domestic companies to make progress in this regard, he said.
Zhang said that user privacy should top the agenda when Chinese companies put AI technologies into use.
Sogou's Wang said that the company only makes use of search-related data to enable various internet search services, while users' chat histories won't be uploaded into its server to ensure user privacy.
