Baidu Wants Android Deal, and More

Google may insist they were standing on principle when they left China, but they also had some heavy competition to deal with: Baidu, a search engine that now holds a 70 percent market share in that country. But Baidu CEO Robin Li is hoping for more – much more.

And interestingly enough, the next step may take it right onto Google’s turf. The Chinese search engine hopes to strike a deal with manufacturers of smart phones that use Google’s Android operating system. Li wants to get them to include a Baidu search box on Android phones that will be sold in China.

The current numbers don’t make the move look that attractive. Androids made up less than one-half of one percent of the 7.25 million smart phones sold in China in the fourth quarter of last year. That’s a small market, but Li seems to think that it’s set to grow – and he wants to get in on the ground floor.

If successful, it wouldn’t be the first mobile search deal that Baidu has made. Last month, the search company struck up a deal with the Symbian Foundation, which manages the Symbian operating system. The two firms agreed to create a joint lab to help the search engine integrate its functions into the operating system. This could get Baidu some real traction, as Symbian-powered phones represented nearly a quarter of the smartphones sold in China during the fourth quarter of last year.

That’s hardly the end of the Chinese search engine’s ambitions. Though Baidu stock is traded in the US on the Nasdaq, it is not listed on the Chinese mainland. Li hopes to remedy this situation. He’s mum on the details, however. "The technicalities haven’t been thought through carefully yet. But the general direction is that…we would like to get listed," he said, noting that most of Baidu’s traffic and revenue comes from China.

If Li could get Baidu’s stock listed in China, Asian investors would gain more access to it. Such investments could help fuel the search engine’s expansion. Growth seems to be very much on Li’s mind, and not just as far as the smartphone arena, either.

Li said that his company is also considering acquisitions outside of China. Again, though, Li played coy when asked for details. Such companies would naturally be in the Internet sector, though Li expects that web search will continue to be the biggest contributor to Baidu’s bottom line for at least the next five years, if not the next 15.

This doesn’t mean that Li won’t consider getting into content, or perhaps even expand the company’s search business beyond China. He’s given it at least some thought, noting that any new services launched in other countries will be launched in multiple languages, not just one. Other countries? Does this mean Google needs to worry? Not just yet; Li notes that his firm will probably avoid the United States “for the time being,” as there are already strong search companies there. But Google had better not hold still: "Maybe five to 10 years down the road, the international revenue will also become a very significant part of our business,” Li speculates.

For more on this, check out the Wall Street Journal story.   

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