The history of Baidu, the main Chinese search engine

In China there are many online services that come into severe competition with the better-known counterparts. On the market search engines such projects include Baidu, which is trying by all means to prevent Google to secure world domination. The companys founder Robin Li is for hundreds of millions of inhabitants of China by example. As a child from an ordinary working class family, he, through his own mind, he created the company, which is one of the largest players in the Chinese it market.

Robin graduated from the faculty of computer science at Beijing University, and as a capable student had the opportunity to continue their education in the U.S. During training in the States he changed his Chinese name Anhong on more sonorous Robin and found a friend, also a native of China, Eric Xu. The graduate school at the University of the state of new York enabled him to work in several it companies, starting with IDD and ending Infoseek, which was one of the first search engines. During this period Robin developed the algorithm Randex to rank search results, which became the basis for Baidu.

For a long time considered the possibility of launching your startup in the US, but in the end he returned to China, where he saw the prospects for creating web services. In 2000, together with Eric Xu, who has worked as a commercial agent at home based web services company Baidu. The name was taken from an ancient Chinese poem and means “searching for dreams”. Starting capital of $1.2 million was raised from American venture capital firms, who saw in this project the potential. During the creation of the project of the friends lived in a hotel room and worked 15 hours a day.

After a year Baidu raised $10 million investment, which strengthened their position. The first model of the service involves the provision of other resources platform to search. While Baidu received money for each request. However, this model was soon tired of Robin Lee, and he decided to turn the service into an independent project. Therefore, in 2001 the contracts with the largest web portals in China, Sina and Sohu, were severed.

Thus began the story of the perfect search engine for PRC residents. Robin Lee admits that some solutions borrowed from other projects, but the key features were created based on his own ideas. The most important step in the process of formation of the company was the correct selection of employees. Guide Baidu carefully approached this process.

In most cases this is the same as Robin Li, PRC citizens who are educated in U.S. universities and worked in large it companies. When this footage in Baidu matched so perfectly that Google tried several times to get some key personnel. The superiority of the created project, it was obvious, therefore, already in 2002 Baidu controlled 50% of the industry in China. After a year the company managed to strengthen its own position, actually monopolizirovat audience. In 2005, the companys profit was $13.2 million.

At the moment, Baidu controls 80% of the Chinese market, which is about 465 million users. A huge part of the traffic (about 40%) in Baidu provides the service of finding the direct links to download the tracks. Such disregard for copyright sparked a wave of condemnation from record companies around the world, but Robin Lee ignored him, noticing that the fight against illegally posted content is not the purpose of the search engine. It is likely that the young company would have destroyed by means of lawsuits, but the Chinese government does not extradite its citizens.

High income is associated, primarily, with the original method of monetization. Baidu did pay the possibility of hit of site in the top search. The cost depends on the topic of resource and key phrases. The service remained very selective in choosing clients, which led to a series of scandals.

In 2007 in Chinese the news sounded information about the abundance in Baidu advertisements of charlatans posing as graduate doctors. The melamine scandal in 2008 nearly destroyed the company. The point is that China has begun an investigation into adding harmful substances in baby food. Part of the dairy companies, which was opened a criminal case, tried to hide his involvement by the removal of search queries mentions about yourself in the subject of the investigation.

Baidu has agreed to their offer, and soon the company itself was under attack. Shares in one day has dropped in price by 60 points, the brand has suffered enormous damage. In such circumstances, Robin Lee had to apologize publicly and start a purge. After the dismissal of the guilty, the company has decided a more thorough approach to its advertising platform.

To solve the problem it was created “Phoenix Nest”, which is checked by advertisers, are assisted in creating their own ads, and tracks traffic. New advertising platform soon had significantly strengthened the financial condition of the Chinese search engine, allowing to achieve high profits. In 2014, Baidu has set its own record, increasing revenue by 53% and reached $7.9 billion for the year. Much of the increase in profits associated with the provision of foreign resources the opportunity to advertise their services.

In addition, intending to attract new advertisers and to declare itself around the world, Robin Lee made the unprecedented step of opening in the same year the office of his company in the U.S. According to analysts, this action can be the beginning of the global expansion of Chinese services to the world market. Seriously affected the further development of Baidu perennial confrontation intervention Google. Start the fight began in 2005, when the Chinese company made an IPO, during which it earned $124 million, which did not prevent her to put the record of the decade, increasing the value of the shares at four times in one day.

At this time, Baidu has attracted the attention of Google, which has invested several million dollars trying, thus, to “feel” the Chinese market. Tough competition between services erupted after the creation of a special division of Google China, aimed at speedy integration of the world leader in China. In these circumstances, Robin Lee began to build the brand around that Baidu knows how to work with users from China. Soon online and on TV appeared a viral advertising video, in which Chinese master wins stereotypical American.

He complemented this picture is the phrase that only the Chinese know how to make quality services for its citizens. Another method of protection against intervention by Google is the use of features of the political system of China. Baidu readily excluded from search results links to anti-government themes and pornography. Google tried to retaliate but failed to realize that, as against this was their own ideology justifying the purpose of service in the dissemination of information worldwide. Coming thus to the protection of the interests of their own company, Robin Lee made the right decision.

Soon government drew attention to the willingness of the Chinese leadership of the project to compromise and start to fully support him. For example, according to the decision of the state were prohibited from using Google Drive at the time, as a similar service Baidu Wany Pan worked without problems and failures and increasing the flow of users who prefer Chinese product. Serious damage to the intervention of world leader among search engines was caused by the creation of a “club Baidu”. Went there over 30 thousand resources that were offered attractive promotional discounts if placement search bar in a prominent place.

All the forces gathering of supporters and using the government as leverage against Google, Robin Lee nevertheless stressed that he was pleased by the presence of serious competitors, because they help Baidu to become better. Another platform for competition between two search engines were computer clubs. In China this type of institutions used a special program that restarts the computers at midnight. Both companies spend tens of millions of dollars to be the default in browsers has stood by their product. Part of the profits they are also forced to share with the administration of the institutions.

Tough fight in the domestic market of China forced Google to go the other way to overthrow a rival to the throne. For this, he signed a contract with the largest resources Tiania.com and Sina.com so they placed the search box in a prominent place. This, in turn, drastically increased the audience of the search engine, providing him with about 15% of the Chinese market. But the U.S. company was against the requirements of the Chinese authorities, and it is not allowed to build on the success. The main condition of China was to block certain types of requests.

Initially, Google has even considered the possibility of meeting these requirements, but faced with condemnation from the world community, the Corporation refused this step. The Chinese government reacted harshly, repeatedly locking a resource in 2013 and 2014. Baidu during this period took full advantage of the weakness of the competitor, increasing its market share and improved a number of services that have strengthened their position in the Chinese Internet. Protracted struggle with Google has allowed the Chinese search engine has become known not only for China but also outside it.

The lions share of fame, received the Robin Lee, who was considered a strong player in the global market. This in turn allowed him to create the image of a modern Chinese businessman, who is able not only to compete, but also to find a common language with the government. The popularity of the Director of Baidu in China is so great that hundreds of millions of citizens supported the start of his political activities, when in 2013 Robin joined one of the government committees. The confrontation with Google not only brought fame to the search engine, but also added to his rivals. A new enemy resource has become the Chinese Alibaba Group holding, which seeks to ensure that customers continued to use their search services.

In 2009, users of Baidu was blocked access to the site Taobao.com. In response, Robin Li announced the service Baidu You A platform for trade, which was to crush Alibaba. However, now the search engine controls only a small proportion of Chinese online Commerce. A new milestone in the confrontation was the Alliance between Baidu, Wanda and Tencent in 2014. The three companies invested more than $865 million for the creation of a platform for e-Commerce, which in the future should become a real competitor to Alibaba in the struggle for dominance in the Chinese market.

According to analysts, the upcoming rivalry has become something truly spectacular, because three of the richest man in China tries to resist the dominance of the fourth. At the moment, Baidu continues to fight on two fronts. The number of services they are not inferior to Google. Among them stands out the presence of social networks, e-mail, online maps, news feeds, Baidupedia — which, being a local analogue of the online encyclopedia that includes over 7 million articles, more than the English and German sections of Wikipedia combined. Also a very interesting approach to the implementation of online maps, where each user can see a 3D panorama of Chinese cities.

Running so many services has been made to ensure the global integration of Baidu. But, unfortunately, the Chinese search engine was not yet able to compete with Google in other countries. Despite the correctly chosen strategy to the original conquest of the Asian market, Baidu disturbing factors, the expense of which was achieved dominance in China. It turned out that users do not like the restriction of content, links to download songs banned in other countries, and translations of the search engine in other languages performed quite competently.

In addition, Google and other search engines have already secured its dominance in these markets, and therefore to capture the audience quite difficult. In his numerous interviews Robin Lee continues to insist that Baidu goal is to become a world leader among search engines. In fact, everything looks not so positive — it is unknown whether the company alone to dominate even in Asia, not to mention the world at large.

However, Do not give up. According to him, he had already “not the first day in the ring”, and if the rivalry with Google and Alibaba anything and taught CEO of Baidu, is “to go to the end and always be ready to fight”.

Source: google.co.uk

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