Global search engine giant Google Inc. faces numerous obstacles in its China operations after becoming entangled in a copyright case involving Chinese authors and its recent threats to pull out of the Chinese market due to the country's Internet censorship.

Google's decision to potentially leave China was partly due to Internet attacks that originated from the Chinese mainland. But Google was not alone. On January 13, users were also unable to log on to Baidu.com due to similar attacks.

Google now holds a 31-percent stake in the Chinese search engine market, while Baidu.com controls the remainder. A day after announcing its possible pullout, Google's NASDAQ share price dropped 1.1 percent while its rival Baidu's price surged 14 percent.

Analysts said the retreat will be a major loss for Google, as Chinese revenue accounted for about 10 percent of Google's global operations. JP Morgan predicted a withdrawal from the Chinese market would cost the company $600 million in losses in 2010. Many fear that Baidu would hold a search engine monopoly over the Chinese market in Google's absence.

"If happens, it would be a zero-sum game for the whole industry as well as Google itself," said Lu Benfu, an Internet expert at the Chinese Academy of Sciences.