Sohu.com, one of China's earliest Internet plays, is returning to its roots as a search engine with double-digit growth expected in the area for the rest of this year, its chief executive said on Monday.

Sohu, whose name literally means "search fox", started off as a search specialist but later neglected the field in favour of other pursuits, most notably mobile phone-based services.

The company rededicated itself to the search area last year with the launch of its Sogou.com Web site, and now expects the business to grow at double-digit rates for the rest of this year on a quarter-to-quarter basis, said Chief Executive Officer Charles Zhang.

At that rate of growth, sponsored search revenues, which totaled $2.73 million in the first quarter, could go from a current contribution of about 11.5 percent of total sales to possibly 20 percent by the end of the year, he added.

"Our (search) traffic has tripled in the last six months," Zhang told Reuters in an interview in Shanghai. "In the next two months, we'll focus a lot on Sogou."

China's top search engine in terms of traffic is Baidu.com, which aims to raise $200 million in an initial public offering this year, sources familiar with the situation previously told Reuters. It is followed by Sogou and then Yahoo's 3721.com site, according to Web research site Alexa.com.

Google is also a major player in the market, but until recently did not operate a separate China Web site.

Zhang said that Sogou, launched last August, has moved up rapidly on the competition, recently overtaking 3721 for the number two spot in terms of traffic.

"I think we can pass Baidu in two years," said Zhang, who has a PhD from the Massachusetts Institute of Technology and who abandoned his physics background to pursue a career in the then red-hot realm of dot-com operators.

Since its founding, Sohu has gone through a series of ups and downs, beginning with its successful IPO in 2000. From there the company rode the dot-com rollercoaster, sinking from a high of $13.78 after its IPO to a low of 52 cents per share in 2001 as it searched for a workable business model.

The company and its two main rivals, Sina Corp. and NetEase.com Inc., rose from the ashes in 2003, as they turned their first-ever profits on services built around the popularity of mobile messaging services in China.

But their shares have been hit again more recently amid a Beijing-led crackdown that began more than a year ago to clean up the unruly sector. That crackdown -- on controversial content such as pornography and spam -- saw Sohu itself sanctioned at one point for sending spam messages.

Sohu's mobile messaging revenues accounted for less than 30 percent of its total in the first quarter of this year, well below the more than half of revenues before the crackdown began.

Zhang said he has learned some lessons from the crackdown, most notably not to depend too much on third-party revenue providers, in this case the Chinese mobile carriers that paid Sohu based on services delivered to cellphone customers.

"All the Internet companies are trying to go this way," he said. "We'll continue to focus on brand advertising and search."

Source: Reuters