China’s Baidu Search Engine Hits A Rough Patch

              Generals Know of Winning and Losing

                                    勝敗乃兵家常事

 Baidu co-founder Robin Li ( the 7th richest man in China) has had to face some pressing problems recently.

Baidu profits for Q2/2016 are down 34.1% year on year. And Mr. Li himself admits that it may take 3-4 quarters for things to turn around.

The problem? Baidu has come under public and private scrutiny for its advertising and search reporting policies. Users complain that they often can not distinguish between genuine search results and paid advertising. To compound this, a college student, Wei Zexi followed therapy for cancer found on Baidu and died.

 On July 28, Mr. Li described countermeasures and future prospects during a conference call on Q2/2016 results. Mr. Li said that tighter control and new regulations will suppress earnings, but in the long term Baidu will enhance the Baidu user experience. He promised to reduce sponsored links as well.

 Since its founding in 1999, Baidu has steadily moved forward to become China’s premier search engine. Now it seems it is time for some real soul-searching and implementing effective measures to restore the company to profitability and to mend the damaged brand in the eyes of China’s massive Internet-using public.

 

 

 

 

Photo:  Bidu CEO Robin Li Fortune Live Media via flickr

Baidu 2016 Q2 Balance Sheet via Baidu

Baidu 2016 Q2 Earnings Call Transcript