Search engine figures show the cost of Google's China policy

Google's tussles with the Chinese government have cut its share of the global advertising search market below 70 percent, according to new data from Strategic Analytics.

The overall advertising market grew by 2.7 percent globally in the last quarter to US$6.2 billion, according to the analysts. However, Google's share of the market fell from 71.1 to 69.7 percent.

“Google’s dispute with the Chinese government, and subsequent withdrawal from the Chinese market, has given Baidu the advantage of unrivalled growth in the world’s largest Internet market by users,” Jia Wu, an analyst at Strategic Analytics said.

Baidu was the biggest winner of the quarter, with revenue growth of 1.4 percent making it the fourth largest player in the market, less than one percentage point behind Microsoft. Google's share however dropped 1.4 per cent.

“Google is growing, but not growing as fast as Microsoft and Baidu,” Wu said.

“The Chinese market is also growing much faster than the rest of the world and international firms haven't been able to compete against local operators.”

He explained that while Google and Baidu have strong positions in China the next three largest operators were local companies that operated in the country's regions.

Despite major investments Yahoo too lost market share in the last quarter, down 0.3 percent. Otherwise the market remained largely static.