Baidu boss: Google don't know China
Native search giant nabs 99% of Chinese netizens
Robin Li — the chairman and CEO of China's mega–search engine Baidu — says his service is now used by 99 per cent of his country's internet users. That's nearly 420 million people, or about one third of the country's population.
"We have very high coverage," Li said this afternoon during an appearance at the Web 2.0 Summit in downtown San Francisco, drawing laughter and applause with this bit of understatement. "We actually answer more queries in China than any other search engine in any other market."
That includes Google in the United States.
Baidu's hold on the Chinese market is especially strong since Google began redirecting its Chinese searches to Hong Kong to avoid local censorship. In a recent Business Week profile of Li, Google boss Eric Schmidt called his company's Hong Kong move a gift to Robin Li. "Every once in a while a gift is handed to you. We handed one to Robin," Schmidt said.
But Li seems to believe that calling it a gift doesn't quite do justice the situation — and rightly so.
When Google entered the Chinese market in 2005, Li was asked what Eric Schmidt should do to win the local search market. "I said [that if I were Eric Schmidt,] I would stay at least six months of the year in China," Lie remembered. "Apparently, Eric didn't take my advice. Hence, eventually, he left — and gave me a gift."
Baidu's stock price has doubled since January, when Google first threatened to leave China, and the company's market cap is approaching $40 billion — which, as Li pointed out, is about the same size as eBay.
The difference between Li and Schmidt is that, well, Li is Chinese. He studied computer science in the States and worked on search in Silicon Valley with InfoSeek. But he was born in Shanxi, a northern Chinese province. Li said that, like Google, he considered a move to Hong Hong to avoid censorship, but soon realized that this wasn't a possibility. "[Censorship] was a frustration...my first reaction was also 'let's move to Hong Kong]'," he said. "But I realized that wouldn't work for me, because I'm Chinese. If I were to move to Hong Kong, they would call me some kind of anti-government person. My life would be ruined.
"If an American company decides not to obey Chinese law, they are still called 'strategic partners.'"
Speaking with Business Week, Schmidt said that the Chinese deck was unfairly stacked in Baidu's favor — but Li calls this a "common misconception." Li pointed out that Baidu is just one of many search options in China. "There are a lot more choices in China than in the United States for web search," he says. "Here, you have Google and you have Bing. What is the number three?"
Li said that Google didn't succeed at least in part because it didn't understand the market. "China is a very different market," he said. "It is a large and growing market. The market conditions change every day. If you're not close to that market, it's very difficult for you to evolve with market demand." ®
Rest assured, Chinese business comes before Lo Fun (Whites) from overseas
The Chinese government has many levers to pull to favour or advance their interests.
The difference is America gets royally choked up when other countries do what they do. America has the finesse of an elephant whilst the Chinese are like a butterfly.
If you examine the record America's interest is in protecting oil supply lines whereas the Chinese are securing raw materials. Which do you think is the smarter?
Never been to China then...?
A statement like China having a national intranet is just plain silly. Apart from Facebook and Youtube being periodically blocked for various reasons, the majority of the time, internet censorship in China is barely noticeable.
Of course that's not to say there's no censorship in China, it's just not as bad as most people make it out to be.
Doing business in China is very personal, all about getting to the right people. Only recently have Westerners started understanding how to be polite, respectful and friendly all at the same time.
Understanding the Chinese market...
@rxdg, @ghormax, @jaitcH, etc...
There is a fundamental mis-understanding by so many commentators in the West about the nature of Chinese censorship. Everyone shouts blue murder about the "censorship" that occurs as if it's the the primary reason that sites get blocked in China.
@ghormax, these "web 2.0" site you refer to. I pose a question that what do sites like Youtube, facebook, twitter, foursquare, tumblr have in common? The answer would be that they all have behemoth "competitors" within China. Notice how facebook was freely available as was youtube until the chinese "competitors" established themselves and got notoriety in China. I say "competitors" because like so many many many things here in China they were almost all direct and complete knock-offs of the originals.
The Chinese facebook began as "xiaonei.cn" or "little campus" was set-up just like the face book model, for college students only. Now it's "renrenwang" or "everybody net" and everyone can use it. When this site appeared it was a byte for byte clone.
Now the same goes for that wretch Baidu, the chinese twitters, foursquares and what not. Half the social market in China is all cornered by Tencent (QQ makers). Youtube has it's clones in Yukou and tudou. China's "censorship" is simply blocking and tantamount the most overtly subversive, but to some (under the shade of polticial censorship) economic protectionism. They simply don't want foreign companies to have a foothold in China. They keep the market in their market.
Robin Li's statements also smack of overbearing arrogance. As mentioned, business in China is just simply not based on a meritocracy of sorts as it might be in the west. A business does not become most successful by offering the best service and being the most popular. It just doesn't happen. Whilst there are lobbyists and corporate shills in the west, corruption is ENDEMIC in China, at every level and every entry point.
It's simply not the case where countless articles criticise google for failing to "crack" the chinese market. It's not failing to understand the market either as Robin puts it. He is being cheeky as fuck. Google have simply not been allowed to succeed. Google's image search is routinely hampered by non-loading results due to the Great firewall - and here is the most important part.
If you visit google outside of China you get a much sanitised version of the engine. Baidu as a google knock off offers music and movie searches with direct downloads to pirated material. Something that Google would be destroyed for in the western media if they ever tapped into the market that way and offered the same service. You won't get the same illegal results from Baidu from outside of China as you will in.
Trust me when I say, the censorship of the Internet in China is goes much deeper and far beyond political censure. It's a far more insidious world we live in. The old way used to be invade a country and conquest. China is just going to do it economically and the trust fund starts at home.