Microsoft’s Kevin Schofield (he is an executive who works at Microsoft Research) confirmed today that China is redirecting traffic from Google and Microsoft’s search engines to Chinese Baidu.

Quote? “That really sucks.”

Saran Chari is on my video channel talking about what today’s announcement with MySpace and Google means to developers like Flixter (they make a popular Facebook application).

I recorded this today after the Google/MySpace press conference.

I asked “does it let you build the same kinds of apps you build on Facebook?”

Answer “absolutely.”

I ask about limitations that he sees.

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So, the conversation in the hallway here at the Nokia conference that I’m now at is “what will Yahoo and Microsoft do?” Followed quickly by “what will Facebook do?” Or, “is Zuckerberg scared?”

During the last panel, which funny enough was about developers and social networks, they asked the audience which social networks people used. Facebook? Nearly every hand went up. MySpace? 1/3rd of the hands went up? The rest? Very few hands went up.

So, Facebook is STILL in the driver’s seat. Or, as Erick Schonfield says over on TechCrunch: “Not so fast Mike.”

What is the best answer for what Zuckerberg will do that I’ve heard? “Embrace and extend.” Facebook should come out and say “we’re supporting Open Social too.” But then they should say “but we have a new ‘version 2.0’ platform to announce today that goes a LOT further than Open Social goes.”

That would take all the wind out of these sails.

As to Yahoo and Microsoft? Well, I talked with an executive from Yahoo today and he said he had nothing to announce. Translation: we have no clue. If they had a clue they would have had all guns blazing today. Now their choice is to join up. The industry support is too strong behind Open Social. Or, they could make a deal with Facebook on their “embrace and extend” strategy.

What will Microsoft do? Who cares. They bought the inventory on Facebook. They are safe for now by NOT having a developer strategy. I think that’s stupid long term, but heck, my Microsoft stock is going up so who cares?