China search giant Baidu blasted by state media

Aug 18, 2011
A man walks past the logo of Baidu at its headquarter in Beijing, 2010. China's state media has launched stinging attacks on the nation's hugely popular search engine Baidu, in what analysts say may signal government unease about the firm's growing market power.

China's state media has launched stinging attacks on the nation's hugely popular search engine Baidu, in what analysts say may signal government unease about the firm's growing market power.

This is the second time that the privately-held has come under strong media criticism, after state television blasted its advertising practices in 2008, forcing it to revamp part of its business.

The state-run China Central Television (CCTV) once again attacked the firm -- which accounts for more than three-quarters of China's web -- earlier this week in a programme that alleged fraud by Baidu advertisers.

The show, aired on CCTV's business channel, claimed Baidu users were losing money on phony airline tickets allegedly sold by advertisers on the .

Wu Yue, host of the programme, told the audience: "Obviously Baidu is not able to solve the problem through self-discipline. A company's fundamental motive is to chase profits."

"If there is no law or regulation in place to restrict it, it is difficult to improve the situation at the roots," she said.

The People's Daily, mouthpiece of the ruling Communist Party, joined in the criticism with an opinion piece Tuesday that said Baidu could be "abandoned" by Internet users if it only focused on short-term profits.

"It's time for Baidu to shoulder ," it said.

A spokesman for the search engine declined to comment.

Bill Bishop, an independent Beijing-based analyst and adviser to Internet start-ups, said there were several theories as to what was behind the criticism, including possible machinations by current or potential competitors.

"Baidu has become an effective monopoly in Internet search," he wrote on his blog DigiCha.

"It is unlikely the government is pleased with Baidu's market power, and the CCTV report may be a sign that Baidu should expect increased scrutiny and regulation."

In 2008, CCTV criticised Baidu for allowing advertisers to pay for space alongside top search results, without labelling it as an ad, prompting the search engine to overhaul its advertising business.

The criticism has sent Nasdaq-listed shares of Baidu down more than eight percent so far this week.

Dick Wei, a Hong Kong-based analyst with JP Morgan, said the issue could have a short-term impact on the company's revenue, but was still bullish about the firm.

"Given differentiated technology and market leadership, we think the long-term prospects for Baidu are still very positive," he said.

Explore further: Fitbit to Schumer: We don't sell personal data

add to favorites email to friend print save as pdf

Related Stories

China's Baidu search engine launches English blog

Jan 11, 2011

Chinese search engine giant Baidu has launched an English-language blog on the country's online culture, a company spokesman said Tuesday, as the firm looks to expand into overseas markets.

Baidu edges ahead in Chinese online market

Jan 19, 2011

Search engine Baidu further strengthened its dominance of the Chinese Internet market in the fourth quarter at the expense of US rival Google, a research firm said Wednesday.

China's Baidu eyes foreign expansion

May 26, 2011

Chinese search engine Baidu said Thursday it was thinking about expanding into more overseas markets and expected its share of the booming domestic mobile search market to grow rapidly.

China's Baidu quarterly profit up 95 percent

Jul 26, 2011

Baidu Inc., which operates China's dominant search engine, said Tuesday its quarterly profit jumped 95 percent on traffic growth and strong spending by big advertising customers.

Recommended for you

Fitbit to Schumer: We don't sell personal data

6 hours ago

The maker of a popular line of wearable fitness-tracking devices says it has never sold personal data to advertisers, contrary to concerns raised by U.S. Sen. Charles Schumer.

Should you be worried about paid editors on Wikipedia?

11 hours ago

Whether you trust it or ignore it, Wikipedia is one of the most popular websites in the world and accessed by millions of people every day. So would you trust it any more (or even less) if you knew people ...

Philippines makes arrests in online extortion ring

12 hours ago

Philippine police have arrested eight suspected members of an online syndicate accused of blackmailing more than 1,000 Hong Kong and Singapore residents after luring them into exposing themselves in front of webcam, an official ...

Google to help boost Greece's tourism industry

Aug 21, 2014

Internet giant Google will offer management courses to 3,000 tourism businesses on the island of Crete as part of an initiative to promote the sector in Greece, industry union Sete said on Thursday.

Music site SoundCloud to start paying artists

Aug 21, 2014

SoundCloud said Thursday that it will start paying artists and record companies whose music is played on the popular streaming site, a move that will bring it in line with competitors such as YouTube and Spotify.

User comments : 0