Stock Beats Sex

In 2007, the word “stock” beat out the word “sex” for the top search term for Google China. Amazingly, so did two other company names, China Merchants Bank and Industrial and Commercial Bank of China, both hot IPO A-share stocks from last year.

There is an intense battle going on in the Chinese economy for growth. From the best of our estimates, our Chinese IDN domain value increased anywhere from 50% to 500% depending on valuation methods. This is an extremely illiquid market compared to the stock market. The Chinese A-share market (stocks that foreigners are limited on trading) increased 176% on the year, with intra-year highs just above 200%.

One interesting note on the “sex” search is that the government does regulate the sites there. So, while it does not forbid anyone from searching for adult terms, the government does its best to regulate which sites get through the firewall. This would discourage this sort of surfing over time.

These markets in 2008 will be a much tougher read. IDN’s are in a grey area right now with the potential for IDN.IDN to make further changes to the industry. In China as well, the “.cn” TLD is tightly regulated by the Chinese government, which also makes the Chinese IDN market a tough read. At the same time, the stock market will feel the economic backlash of the US recession and must battle to decouple, if possible.

That said, I think both will still see volume increase. I would not be surprised if Stock again surpasses Sex next year, but specific companies surpassing the ultimate search term will be much tougher.

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