CONTROVERSIAL Internet entrepreneur Zhou Hongyi, chairman of security firm Qihoo 360, is known as a scrapper and, some say, a grandstander, who picks fights with the big guys, like Baidu, Tencent (QQ) and Alibaba.

He is currently engaged in a battle for China's US$3.3 billion search market, which is so dominated by Baidu that it's known as the Google of China. Today Baidu has 60 to 70 percent market share, while Qihoo 360 has grabbed around 10 percent in six months since it launched its search engine in August.

Zhou argues that big companies are not nimble or hungry enough to innovate and their products are weak.

China had more than 560 million Internet users by the end of December, adding 50.9 million new users last year, according to the China Internet Network Information Center.

Zhou and Qihoo 360 recently made headlines for its surge in market share and possible cooperation with Google, whose advertising links have been found on Qihoo 360's search webpage.

The 42-year-old Internet warrior is an ardent believer in the necessity of "subversion" and "destruction" for innovation in the IT world and he says it's important for small firms to challenge the market giants - that makes for progress. He sounds like the late Steve Jobs of Apple, his idol.

Those combative principles and mindset, along with fair play and regulation, make Silicon Valley so successful, he says, adding that the words subversion and destruction are positive IT development concepts. They are negative terms in China, however, because they violate traditional concepts of harmony, the doctrine of Confucian precepts and general respect for established hierarchy and authority, he observes.

Subvert yourself

"I appreciate subversion- or destruction-style innovations because this kind of constant subverting and being subverted pushes an industry forward," Zhou told Shanghai Daily in an interview with a few reporters in Shanghai late last month.

"If you don't want to be subverted by others, you must bravely subvert yourself," he said.

That approach has been successful for Zhou, the former president of Yahoo! China, whose Qihoo 360 is the Chinese Internet's top security tool - and it's totally free. Qihoo 360 has more than 400 million users for safeguard security and browser tools, only behind Tencent's QQ and Microsoft's Windows in China's IT industry. Qihoo was also one of the first in China to make a low-cost smartphone.

Zhou is an idol among young start-up entrepreneurs and he is also admired because of his philanthropy as an angel investor for IT start-ups. He has appeared on the TV programs including employee recruitment show "Only You" ("Fei Ni Mo Shu").

More than 4.75 million people follow Zhou on Sina Weibo, China's twitter-like micro-blogging service.

"I want to change the world (in my own way) and it makes me feel alive," said Zhou, who likes to describe himself as a product manager. He emphasizes that his fights with giants focus on product differences. It's a matter of survival, he says, depicting himself as a kind of David fighting Goliaths like Tencent and Baidu.

Though people glorify or vilify him, Zhou is someone they cannot ignore.

Classical music is one of Zhou's interests. In his Beijing office, there are several professional-quality speakers and a lot of CDs.

A native of Hubei Province, Zhou graduated in 1995 from Xi'an Jiao Tong University School of Management, with a master's degree in systems engineering management. In 1998 he founded online search firm 3721, earlier than Baidu, which was founded in 2000. In 2003 he sold 3721 to Yahoo!, becoming CEO of Yahoo! China and then president. After leaving Yahoo! China in 2005, he joined IDG capital investors, heading around a dozen investments into Chinese high-tech start-ups.

In 2006, Zhou founded Qihoo 360 to provide free anti-virus tools, finally pushing the whole online security industry into a "free mode." He also started Angel Capital.

In November 2010, he battled Tencent, China's largest Internet portal and the free instant messaging QQ program. He took aim after the giant blocked Qihoo 360 security services in computers with Tencent's QQ. Internet users were angry at being caught in a business feud and being forced to choose between China's top chatting tool QQ and its top security tool Qihoo 360. The confrontation was dubbed the 3Q Battle (for 360 and QQ).

After several months, China's industry regulator stepped in, ordered both sides to apologize and decreed that QQ and Qihoo would coexist on computers.

In 2006, the new Qihoo 360 fought the Alibaba Group, which owns Yahoo! China. The 360 security tool identified Yahoo's search tool bar (developed from 3721) as "malicious software" and advised users to delete it. It also uninstalled the Yahoo tool bar. Yahoo! sued for unfair competition and won. A court ordered 360 to apologize and pay 30,000 yuan (US$4,762) as a fine and another 40,000 yuan in legal costs.

Zhou's fights, especially the 3Q Battle, made Zhou famous for his strategic warfare. Qihoo 360 Technology Co later went public on the New York Stock Exchange in 2011.

The company is worth around US$3.7 billion since it launched search services and cooperated with Google Inc on advertising links.

Zhou has often crossed swords with famous people such as "science cop" Fang Zhouzi and Lei Jun, CEO of smartphone maker Xiaomi, also a founder of Kingsoft.

"I admit I do have some admiration for him. He's rude, loud and most of the time annoying," said Willis Wee, founder of Tech in Asia website. "But what you can't deny is that he knows how to build a company, he knows how to disrupt, and he has the stuff to challenge the status quo."

Newcomer to search

Qihoo's 360 Search has been battling Baidu since it was launched in August. Because it is built into software (security and browser tools) that most people use, it quickly claimed 10 percent of the market.

The domain name of 360's search service www.so.com represents Zhou's vision: S for safe and O for open.

Zhou says the Baidu-dominated market needs "purification" with new products like 360 Search, which won't accept any medical advertisements.

By contrast, Baidu is filled with medical and health ads, including promotions for questionable products and unregulated hospital links. According to estimates from Zhou's team, around 30 percent of Baidu's search service revenue is health-related.

"Even if I can't defeat Robin Li (Baidu's founder and CEO) in the search sector, Baidu will be forced to improve services and strengthen regulation," said Zhou. "That would be good news to the industry and users."

He likes the "clear," uncluttered, no-ads interface of Google.

Zhou declined to reveal his target for search market share but he said in an earlier interview, "If we can get to 15 to 20 percent market share, then the (Baidu) dominance will have been destroyed."

He has added music and picture functions into the search services.

Free for all

Before Qihoo 360 went public in March of 2011, Zhou often emphasized the value of free security software. But that's a complicated business model.

Qihoo 360 provides totally free security and browser service. After getting enough users, it cashes in through advertising associated with traffic direction and online game recommendations within the browser. This generates revenue from e-commerce websites and game firms.

"I created the new free business model for all users," said Zhou. "Rivals like Kingsoft and Rising (both Chinese software companies) condemned me initially but they had to follow the new business model later."

Zhou's security tools cracked down on the black industry chain of malware that steals user information and passwords and clogs computers. As a result, Zhou said, he and his family were threatened by Internet criminals several years ago through warning calls from strange telephone numbers and anonymous e-mails.

"I'm not afraid of offending those people. The only group I can't offend is users," Zhou said.

What others say ...

Ei! In fact, he (Zhou Hongyi) is an actor.

Pony Ma

CEO of Tecent Inc, blogging about the row between Lei Jun and Zhou HongyiZhou Hongyi is a businessman. He is not Lei Feng.

Lei Jun

CEO and chairman of Xiaomi brand mobile phoneWho will lose the battle between Baidu and Qihoo 360? Users...

Lee Kaifu

founder and chairman of Innovation Works, former Google China presidentI admit I do have some admiration for him. He's rude, loud and most of the time annoying ... But you can't deny is that he knows how to build a company ... he has the stuff to challenge the status quo.

Willis Wee

Founder of Tech in Asia website

Zhou Hongyi's battle timeline

2001 Zhou's 3721 vs China Internet Network Information Center, CNNIC
2002 3721 vs Baidu
2006 Zhou's Qihoo 360 vs Yahoo! China (Alibaba subsidiary)
2009 Qihoo 360 vs Rising, Kingsoft
2010 Qihoo 360 vs Tencent's QQ
2011 Zhou vs Lei Jun of Xiaomi mobile phone
2012 Qihoo 360 vs Baidu