Yahoo lost its second place to Google which now has a 26.9 percent market share, 4 percentage points higher than 2004.
To reverse its slipping performance, Yahoo is trying to enhance IT capacity and pushing forward cooperation with media groups in efforts to provide better and quicker search results.

Google, on the other hand, has a merger and acquisition strategy. It is hunting for companies who can help it expand its market presence.

The search engine business can be highly profitable. Hou Tao, deputy director of I Search, said the search engine business can make profits from advertising and by getting commission or payments from enterprises.

The revenue of search engine operators reached 1.04 billion yuan in 2005, accounting for 24 percent of total Internet revenues and 20 times more than the 2001 figure.

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