Baidu May Be Losing Grip On Chinese Search Dominance (BIDU, GOOG, SINA, SOHU, DANG, AMZN, YOKU, RENN)
Shares of Baidu (BIDU), the largest provider of Internet search services in China, are off 1% today after a report in the Wall Street Journal noted the company is facing heightened competition for market share in China, the world’s largest Internet market. While Google (GOOG) has seen its market share in China slip due to censorship battles with Chinese policymakers, Baidu still faces competition from other rivals.
The news appears to be a slight drag on the Chinese Internet Stocks Index, which is down 0.3%. SINA’s (SINA) microblogging service Weibo, commonly referred to as the Twitter of China, and Alibaba’s e-commerce search engine Etao.com are just two of the sources of new competition for Baidu, the Journal reports.
Baidu had 75.9% of the Chinese search market in the second quarter, the Journal reported, citing data from Analysis International. That’s nearly quadruple Google’s market share for the same period, but Baidu is also facing competition in the form of Sohu.com’s (SOHU) Sogou and from Tencent Holdings, China’s largest Internet company.
Etao and Weibo aren’t direct search competitors with Baidu, but as Chinese ad spending soars, the companies could compete more for the same users and ad dollars, the Journal reported. In an effort to stave off rivals, Baidu has launched forays into both e-commerce and social networking, though the company’s Baidu Talk, which was meant to be a Weibo rival, was recently suspended because it struggled to compete with its better established counterpart.
Looking at other Index members, E-Commerce China Dangdang (DANG), China’s answer to Amazon.com (AMZN), is off 5%. Youku.com (YOKU) is plunging 4% while Renren (RENN), China’s Facebook equivalent, is down 2%.
Investors can track the Chinese Internet Stocks Index for performance trends and a suite of other metrics at tickerspy.com.
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