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Baidu, the company which dominates China's search business as Google dominates elsewhere, has launched a smartphone using the company's cloud platform to reduce the price and keep the users loyal.

The snappily titled Changhong H5019 will sell for less than RMB1,000 (about £98/$158) and offers a three-and-a-half inch touchscreen and unibody case put together by the chaps at Foxconn, but more important is the integration into Baidu's cloud which runs even deeper than Google's hold on Android and is being showcased here in the hope of recruiting other manufacturers.

Baidu's move was widely predicted, but shows how the search giant is aping Google's land grab into mobile services - the handset comes with Baidu Music, Baidu Maps and so forth, as well as cloud-based voice and handwriting recognition (the latter is more important in a pictographic language).

The H5019 will run Baidu's own OS, eschewing the Android spins which are becoming popular in China among competing service providers including the social-giant QQ. The Baidu/QQ conflict has surprising parallels with Google/Facebook, neither of which operates within China.

Google is available in China, but the Chocolate Factory refuses to self-sensor, so has to locate its servers on the other side of the Great Firewall in Hong Kong. The Chinese not only filter the content, but also slow it down and generally muck it about - when we searched Google for "Tiananmen Square" from within mainland China our mobile connection coincidentally disappeared, every time we tried it, showing how insidious the censorship is.

Most Chinese are thus unaware of the pervasiveness of the censorship, only that Google is slow and unreliable, and that makes phones running the stock Android platform (with its Google integration) slow and unreliable too. There are various Android incarnations knocking about China, and numerous app stores competing to supply locals with paid applications and an interesting assortment of malware.

Baidu, like Google, sees mobile as just another way of accessing its services, and just like Google it will have to fight the network operators to sell directly to their customers. Baidu's pitch is more aggressive than the Chocolate Factory's Android strategy, but it’s a very different market and the rewards of success are considerable. ®

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