Baidu, Inc.

Company information

• Date founded: 2000
• Industry: Internet Services and Artificial Intelligence
• Corporate headquarters: Beijing, China
• Type: Public

Overview

Baidu, Inc. is a Chinese-language internet service and artificial intelligence (AI) company known for its search engine, Baidu. Baidu, Inc.’s products include the Baidu search engine app as well as Baidu Baike (a Chinese version of Wikipedia), Baidu Maps (similar to Google Maps), Baidu Health (similar to WebMD with an AI-powered chatbot), DuerOS (a Siri-like virtual assistant), Quanmin (a short-form a short video platform), and dozens of others. The company’s search engine provides multiple searches—image, top, video, and web—as well as news and a web dictionary. Baidu also provides advertising and online marketing services and AI Cloud. Its chief competitors globally are Google and Meta Platforms Inc. in the United States and three Chinese companies, Alibaba Group Holding Ltd., Xiaomi Corp., and Meituan. Baidu, along with the internet and technology companies Alibaba and Tencent, are China’s largest tech companies, often referred to as BAT.

In 2013, Baidu held about 67 percent of the internet market share in China, and about ten years later, Baudu held about 76 percent of the market share. In the early and mid-2020s, 94 percent of the company’s total web traffic came from China. Very small percentages of users were located in the United States, Japan, Hong Kong, and Taiwan. Baidu’s dominance in China is due in large part to the government’s policy of blocking many Western products, including the world’s largest search engine, Google. Baidu, Inc. has developed various Chinese versions of websites. For example, Baidu Baike is a Chinese-language answer to Wikipedia, which is likewise unavailable in the country. Having a presence on this encyclopedia platform is regarded as essential marketing for businesses. Setting up a Baike page requires Baidu official verification, which conveys to consumers the message that the business is legitimate. Furthermore, because Baidu is the dominant search engine in China, Baike pages are included as search results.

Baidu, Inc. went public on NASDAQ on August 5, 2005, closing at the end of the day up more than 350 percent. It was the first Chinese company to be included in the NASDAQ–100 index. On the exchange, it is traded under the symbol BIDU. In 2021, Baidu was the sixth-largest search engine in the world, earning US $19.3 billion in revenue. In 2022, its revenue dropped to just under US $18 billion, but rose to $18.96 billion in 2023, followed by $18.82 billion in 2024.

History

Robin Li was born in Yangquan in 1968. He had four sisters. His parents worked in factories and the family struggled, so his parents encouraged him to focus on his education to get ahead. He took her advice. Li earned his undergraduate degree in library and information science from Peking University. He next attended the State University of New York at Buffalo, where he earned his master’s degree in computer science in the mid-1990s. He went on to an internship at the Matsushita Information Technology Laboratory. He worked for three years at a unit of Dow Jones developing software for The Wall Street Journal online. During this time, he developed a search engine page ranking algorithms that he later used for Baidu. He called the search mechanism link analysis. It ranked websites in popularity based on the number of other websites linked to it. He told his boss, who did not share Li’s enthusiasm. Disappointed, he moved to California in 1997 to work as a software engineer at Infoseek, a Disney company.

Eric Xu was a biochemist living in California who was making a documentary on Silicon Valley. He counted Li among his friends. Li was frustrated because Disney was giving up on search engine development. Both men had contacts in Silicon Valley and decided to form a company in 1999. Two venture capital firms, Integrity Partners and Peninsula Capital, invested $1.2 million. Li and Xu went to China and founded Baidu in January 2000 to provide search services to portals in China, but soon had to pivot when portals did not value the service and did not want to pay for search functions. Other investors quickly provided an additional $10 million. In less than a year, the company established a homepage where advertisers bid for space and paid the company for each click. Advertising was prioritized over relevance in search results. Company leadership permitted government censors to oversee its online presence and established the search engine as China’s most prominent. It became profitable in 2004, and by 2006, Baidu was the fourth-most-trafficked website in the world. Xu left the company in 2004. Unlike American internet users, most Chinese customers are interested in entertainment rather than news. The Baidu website offers many opportunities for amusement, including music downloads and blogs.

The founders took the company name from a poem by eleventh-century writer Xin Qiji, “The Green Jade Table in the Lantern Festival.” It is about searching for one’s dreams despite outside influences. The literal translation is “hundreds of times.”

Baidu, Inc.’s operations are divided into Baidu Core and a segment called iQIYI. Baidu Core focuses on feed-based, search-based, and online marketing services and the company’s artificial intelligence (AI) efforts. The company calls its AI technology engine the Baidu Brain. The company is further subdivided into Baidu AI Cloud, Mobile Ecosystem, and Intelligent Driving and Other Growth Initiatives. iQIYI focuses on entertainment. It provides original content and content from partners.

Baidu, Inc.’s partnerships and acquisitions have moved the company into varied fields with tremendous growth potential. For example, it entered a joint venture with the Chinese automaker Geely. The venture, Jidu Auto, was developing electric vehicles (EVs), and in 2021, announced it would produce self-driving EVs. Baidu also developed a venture with Pony.ai to put self-driving taxis on Beijing streets in late 2021. While the cabs came with a driver due to regulations, users gave directions and made payments for the so-called robotaxis completely digitally. The goal was to have the taxis operate with no human intervention eventually. Baidu also provided AI technology for driverless cars to companies, including Ford and Honda. In 2022, the company announced its self-driving, fully electric Apollo RT6, complete with a removable steering wheel.

The company continued to innovate in developing new services. For example, in March 2022, Baidu AI Cloud debuted an AI sign language platform. In just minutes, it produced digital avatars for sign language translation. This service could help millions of Chinese individuals who are deaf and hard of hearing and living in a society with a shortage of translators. Observers noted the shortage was significant in legal and medical settings and potentially could reduce or eliminate barriers to communicating online.

The company has invested heavily in developing health applications and has made a significant impact on China’s health industry. Baidu developed a chatbot, Melody, that doctors use to collect health information from patients. The company created AI-powered cameras to screen for eye problems. Hospitals began using the high-tech devices in 2019 to screen for diabetic retinopathy, glaucoma, macular degeneration, and other eye conditions.

In the early and mid-2020s, the company continued focusing on autonomous driving technology, cloud computing, and AI. In 2022, the Chinese government approved Baidu’s autonomous ride-hailing service, Apollo Go, which completed over 6 million rides in eleven cities in its first two years of service. In 2023, the company announced its AI chatbot, Ernie Bot, similar to ChatGPT. In 2024, the company announced its text-to-image generation platform, I-RAG, and the no-code app builder, Miaoda.

Impact

Baidu has maintained its dominance in China despite challenges by Google, Yahoo, and Amazon, among others. Google has explored the China market several times. However, operating in the country would require Google to submit to government censorship. Furthermore, Li has vowed to succeed in any such challenge. Yet Google remained Baidu’s closest rival. In 2018, Baidu debuted an AI that translated languages—Chinese to and from English at first—in real-time. This feature debuted a year after Google launched its real-time translation feature. Baidu’s AI trained using two million pairs of Chinese and English sentences. Such work was necessary to speed up translation because of the vastly different sentence structures of these languages.

Baidu has faced a number of legal issues. Customers have claimed Baidu increased client fees by orchestrating clicks on ads. It has been sued for copyright violations because it provides links to websites that offer music downloads. The company argues that it cannot be held responsible for users’ actions simply because it provides links to websites. In 2021, Baidu was one of several companies the government accused of collecting unnecessary customer data via its apps. Earlier reports indicated Baidu apps could have exposed customer data to criminals or government spies.

The Chinese government investigated the company after a college student who tried an experimental cancer treatment died. The student had a rare form of cancer and used Baidu to search for treatments. He chose the hospital that was the top result in his search because he reportedly believed it was the most trustworthy option. Baidu was criticized for its system of selling placement in search results without adequately informing users and lost standing with the public. Some users called for a boycott. The government launched an official investigation and ordered Baidu to provide more prominent labeling of paid results.

The company has also worked on public health campaigns. In 2011, Li and Microsoft founder Bill Gates announced an antismoking initiative. This was the first issue addressed by a public health partnership between the Bill and Melinda Gates Foundation and the newly formed Baidu Charitable Foundation. This came on the heels of a public health report that indicated almost one in four people in China smoked. The Baidu philanthropic organization’s general focus was on youth wellness and development.

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