Google China's Learning Curve

The number of Internet users in China surpassed that of the U.S. this year. While other overseas Internet companies such as AOL have stumbled in the mainland, Google (nasdaq: GOOG - news - people ) has managed to raise its share of the search market to about 28% against a powerful domestic rival, Baidu, in the past three years. Google's Greater China president, Kai-Fu Lee, hired away from Microsoft (nasdaq: MSFT - news - people ) in 2005, has led the charge. FORBES ASIA met the former Carnegie Mellon computer science professor in Beijing.

FORBES ASIA:How important is China to Google?

China is incredibly important because it is both big and growing fast. But when you're number two, you have to try harder. China advertisers aren't paying the same rate as in the U.S. So, although the search market is large, it's not monetizable at the same rate as the U.S. That will change over time.

You were a rising star at Microsoft but left to join Google. Why?

As a computer scientist, I found Google to be exciting. Also, I had realized that my destiny was in China. I wanted to leverage my bicultural background. I wasn't able to find that kind of opportunity at Microsoft or elsewhere, until I found Google. Also, I'm okay at executing, but I'm really good at starting things from scratch.

How would you compare Microsoft's and Google's efforts in China?

Microsoft came in with its own set of challenges: dealing with piracy and government relations. But it had patience, has improved the quality of its people and reached out to the Chinese government. China's president has gone to Bill Gates' house. But Google similarly has done well. We've had to do it in a much shorter time frame. I think it takes a long time for every American company to learn how to operate. General Motors (nyse: GM - news - people ), for instance, a decade ago was trailing Audi and Volkswagen (other-otc: VLKAF.PK - news - people ). It was difficult to understand, but they eventually figured out how to do it. If you look at Coca-Cola (nyse: KO - news - people ), it took time.