Dominant in China, UCWeb Brings Its Mobile Browser to Silicon Valley

With 50 percent of the mobile browser market in its home market of China, UCWeb is now looking across the Pacific.

UC’s next target is the U.S., where the company released localized Android and iOS versions this past week, and plans to open up a Silicon Valley office later this year. (It has already made inroads into India, where it has 20 percent share and is close to knocking off market leader Opera, execs said.)

UC Browser is more than a just dumb container for Web sites; in China, the browser includes its own virtual currency accounts, identity system, social network and navigation services. In a way, it’s more like a mobile-only Facebook platform than the pure Chrome or Safari browsers.

Plus, UC browser is quite fast, because the company maintains local data centers from where it compresses Web sites and sends them to phones. Opera Mini and Amazon’s Kindle Fire Silk browser use similar techniques.

Bridging to the U.S. market won’t necessarily be easy, but UC’s design and experience across the spectrum of low- to high-end phones could be instructive.

CEO Yu Yongfu — who’s on a grand tour of Silicon Valley this week — emphasized that while his company started doing all this in 2004, the U.S. smartphone market only launched with the iPhone in 2007.

And beyond that three-year lead, China is supposed to oust the U.S. as the world’s biggest smartphone market this year.

Yu said he thinks he understands how to deal with the limitations of mobile — small screen size, reduced bandwidth, limited input, short battery life and some eight different operating systems — better than just about anyone.

Still, it’s not clear that the pillars of the UC Web strategy — compressing sites to speed up page loads, and bundling in services and shortcuts — will go over well in the U.S. smartphone market, where we have tended to like our browsers to just show Web pages for us, while leaving heavier lifting to dedicated apps.

UC Browser has 200 million active monthly users, with 50 million of them on Android and the rest spread across other platforms. It gets about a quarter of its users from deals to be preinstalled on phones, said CFO Roy Rong.

Like other browsers, UC receives revenue through search referral agreements (in China, the default is Baidu; in the U.S., it’s Google). The UC app also includes paid links, display ads, and virtual goods sold in the Flash games it licenses for users. It has its own “app store,” and helps users save bookmarks to HTML5 apps on its home screen. It’s almost like a mobile Web OS.

Rong and Yu said they couldn’t think of any examples of Chinese Internet companies with significant usage in the U.S., so they are hoping to blaze that trail.

To get things started, they rented data centers in Los Angeles and Dallas, signed an agreement to bundle Evernote in UC Browser to help it get distribution in China and vice versa (and plan to do so with other apps), and tweaked the browser’s interface to be more spacious and empty.

For whatever reason, people in China seem to prefer more clutter, Rong said.