Brands that tap into female consumers in China could enjoy significant growth according to the latest research from MEC. The study into women in 'lower tier markets' identified 57% of women in Tier 1 and 2 cities across China as the principal purchasers in their household, with some making decision for their extended family. This figure rose to 59% when extended to all lower-tier cities.

Young consumers in China are more open to adopting the internet in their daily routines than their older counterparts, according to a new study from Synovate. The market researcher's Media Atlas China report explores the differences between consumers across 66 cities and rural areas in China. It found that the internet and mobile were continuing to gain momentum in the market with 64% of 15- to 24-year-olds stating the internet was integral to their lives.

Much pondering comment today in the press about Google's threat, issued on Tuesday evening, to shut down its operations in China after chief legal officer David Drummond stated that the company was "no longer willing to continue censoring [its] results". The immediate trigger for the move is thought to have been a number of attempts to hack into human rights activists' Gmail accounts.

Google is currently negotiating with the Chinese government, but the stakes are high for the latter, which will probably prefer to see Google go - despite the embarrassing signals that might send out internationally - than allow itself to cave in on censorship, the retention of which it will see as much more crucial to maintaining its domestic omnipotence. Already, the State Council Information Office's Wang Chen has commented that internet companies operating in China will be expected to help the government "guide opinion" online. For Google, whose foray into China has seen it make compromises that many considered sat incongruously with its corporate motto "don't be evil", this cannot be acceptable; the Chinese government knows this, and probably sees Google's move as a face-saving manoeuvre. It looks as if Google may have calculated that the potential goodwill engendered by a principled move out of China may pay dividends in the long run if it is seen to be 'not being evil', commensurate with its stated corporate goals. However, it will no doubt be fascinating to see the details of any deal that does emerge.

Google.cn only accounts for around 30% of searches in China, its much larger Chinese rival Baidu.cn being the industry leader. Even so, Baidu's shares rose 12% yesterday on the news of Google's potential departure.

Baidu, China's top internet search company, with 62% of the market (Google is on 29%), has announced it is to overhaul its online ad system. The previous arrangement had attracted complaints because it did not clearly differentiate ads from natural search results. Phoenix Nest, the new system, is designed to remedy this and is also expected to boost Baidu's revenue.

The company turned a net profit of US$56.1 million in the three months to the end of June, up 45% year-on-year, on turnover up 37% at US$160.7 million.

This week we publish the July edition of our Advertising Expenditure Forecasts report, in which we predict global ad revenues to fall by 8.5% in 2009. However, the decline has been slower in Q2 than it was in Q1, and we are optimistic about the overall picture from Q3 onwards. We expect modest growth to return in 2010.

Meanwhile, the big story that both the FT and the Telegraph have focused on is the continuing rise of China; 2009 is now likely to be the year in which the Chinese ad market overtakes the UK's to become the fourth-largest in the world behind those of the US, Japan and Germany.

In an interview with the FT, Lagardère Active chief executive Didier Quillot has said the media operator is looking to expand in China - where it has operated for twenty years and now publishes 16 titles - and Russia, where it is buying up regional radio licences. The shift in focus to Chinese and Russian expansion is intended to help the company remain profitable at a time of declining ad markets in its traditional western market habitat. Mr. Quillot commented:

"When you add growth from the internet, growth from emerging markets and extra growth from the adjustments to our core business, our ambition is to have growth in our turnover in the next three years, despite the advertising recession which has set in in western countries."

The China Internet Network Information Center, run by the Chinese government, reports that the number of internet users in China had risen to 210 million by the end of last year; it expects that it will soon overtake the US to become the single largest internet market in the world. ComScore, based in the US, puts the number at a more cautious 166 million, but even so it is obvious that the Chinese internet market is growing at a very rapid rate.

For advertisers, though, China still poses difficulties: Regulation is tight and many popular websites are blocked for political reasons. However, some believe that the Beijing Olympics could provide a shot in the arm to the internet in China, both in terms of penetration growth and in terms of encouraging more openness (to advertisers, and more generally) as the international spotlight comes to bear and the government becomes keen to avoid loss of face. Time will tell.