Online marketing services providers may be interested in the news that Chinese state-run news agency Xinhua has launched a new search engine that will compete with the market leader in the country, Baidu.

The Panguso site, developed jointly with China Mobile, will seek to provide information to the 457 million internet users in the country, it was stated.

Chairman of China Mobile Wang Jianzhou said: "Although the online search market is highly competitive and several domestic and foreign players have taken their share, the market still has huge potential."

However, the site will be subject to restrictions imposed by the government in the country, with politically sensitive results censored according to official guidelines.

Last month Google, which pulled out of China in 2008 in a dispute over result filtering, hinted that it may be considering a return to the market in an interview its chief financial officer Patrick Pichette gave to the Times.

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