Online security firm accused of stealing user info (2)

Users concerned

There is "no privacy" when using Qihoo 360 products, Zhang Ning, a white-collar employee told the Global Times when she heard of the report.

Zhang said she had been using Qihoo's browser and Safe Guard software, as it is free of charge.

"After I have been shopping online, my computer always pops up advertisements for the same type of products that I bought a few minutes ago," she said, noting that Qihoo products must have monitored her behavior on the computer.

Almost all search engine providers monitor users' behavior for advertisement purposes, said Li Zhi, an analyst with Analysys International.

The real problem is that China has no law for violation of privacy and has no clear definition of privacy, such as whether shopping behavior can be monitored for advertising or commercial campaigns.

After the report was published, many netizens said on their personal Weibo that they had the same concern about Qihoo's products and some said they would uninstall their Safe Guard software.

"After I used the 360 browser, I could no longer use other browsers," Shu Yuan, a medical distributor, told the Global Times, adding that he once needed to get access to a client's website via Internet Explorer but failed.

If users uninstall Qihoo's Safe Guard from their computers, it would be the end for Qihoo, Guo Yu, a security researcher, told the Global Times on February 28.

Qihoo responds

At a media briefing on February 28, Qihoo pointed out that the NBD report did not interview Qihoo staff but only cited anonymous industry insiders from Qihoo's competitors, including Baidu, Tencent and Kingsoft.

The company said that the interaction of 360's browser with cloud computing is aimed to match and identify virus programs.

As for the deletion of its products from the Apple Store, the reason is that the products did not accord with Apple's rules for applications, but had nothing to do with the privacy of users, said Zhou Hongyi, founder and CEO of Qihoo 360 at the media briefing.

Zhou said the reason for the rumors is that Qihoo 360 has been successful in entering the search engine market, which is still dominated by Baidu, and also its success in achieving greater market share than competitors such as Tencent.

"Since we launched the search engine service in August 2012, the market value of Baidu has fallen by 100 billion yuan ($16 billion)," Qu Xiaodong, the head of PR at Qihoo, said at the media briefing.

Qihoo grabbed market share quickly by first launching free Internet security products, in particular its Safe Guard in 2006, and it is now the No.1 provider of Internet and mobile security products and services in China in terms of user base.

It launched its browser in 2008, which has climbed in terms of market share to the No.2 spot from eighth in January 2011, according to CNZZ, an Internet market intelligence agency.

While providing free products, Qihoo generates revenue from web games and online advertisements, which contribute about 70 and 30 percent of the company's total revenue, respectively, based on financial results released by the company in November.

Qihoo is set to release its fourth quarter report for 2012 Tuesday.

"Given that Qihoo is attacking Baidu, Sohu and other Chinese companies, the government has a vested interest in stopping the infighting," the Motley Fool website reported Saturday. "If the company backs down in the face of government pressure, then the negative impact on sales could be devastating for investors."

Qihoo said in a statement sent to the Global Times on February 27 that it aims to raise its share of the search engine market from the current 15 percent to 20 percent by the end of 2013, and increase it annually by 10 percent till 2015.