Can Baidu make it big on the world stage?

chinese dragonChinese search engine Baidu had a busy week last week, launching a new version of its browser software, announcing decent financials and planed expansion internationally and into the mobile space.

As I wrote in The Register, however, it’s unsure whether the company which has roundly trounced Google in its home market has the ability to do the same to the US web behemoth across the Pacific.

Reports emerged that the firm is planning to set up some kind of outpost in Brazil – dangerously close to Googleland – while CEO Robin Li said it would be looking to build on its strong financial performance in 2011 by monetising mobile traffic and social media platforms and expand internationally.

The mobile piece makes absolute sense. With the mobile internet expected to far outgrow its fixed line antecedent – especially in developing countries – it’s an area any web company should be concentrating on.

Gartner analyst Roger Sheng told me that the firm would look increasingly to hardware partnerships with the likes of Lenovo, ZTE and others to gain a bigger foothold in the mobile space and to make money out of this market, while also looking to monetise its mobile search traffic.

The international picture is a little less clear, however. Baidu has traditionally failed to set the world alight outside China. Despite launching various services in Japan, Thailand and even the Middle East, the firm has struggled to differentiate its offerings from local competitors.

According to SEC figures cited in a recent China Daily report, the firm actually lost over $100m from its international operations between 2008 and 2010.

Put simply, it is still an immature company on the world stage and will be roundly beaten in Brazil,  where Google has a virtual monopoly, just as it was in Japan. Those tasked with masterminding a reversal of these fortunes from the firm’s new offices currently being built in Shenzhen will certainly have their work cut out.

Baidu made great play of being the home grown champion when Google was falling out of love with China, and may have won users over by ramping up the nationalism. It is also thought to have been simply better at dealing with Chinese language queries.

Both strategies are doomed internationally. It’s going to have to come up with something a little different to conquer markets outside the People’s Republic.


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