China’s eyes expansion to US, Europe: CEO

Baidu – often dubbed the Google of China – will eventually expand into the U.S. and Europe, the Chinese search giant’s chief executive said on Friday, as the business looks to new areas such as driverless cars and finance.

Speaking at the Viva Technology conference in Paris, Baidu CEO Robin Li, said expansion was definitely on the cards.

“I think eventually we will go into Europe, U.S. and then many other places,” Li said during an on-stage interview.

“We are in a number of countries, but we need to find a new battleground. Search is maturing, and mobile is very different from desktop. We need to find ways to access this kind of new market.”

Baidu operates a search service in China on mobile and desktop. It dominates the search market in China and over 90 percent of its revenues come from advertising. So far, Baidu’s international expansion efforts have focused on emerging markets, where the growth of mobile is exploding and internet connections are slowly improving. Baidu has operations in Brazil, Indonesia and Thailand. It does however operate in Japan too which is a more advanced mobile market.

In each market, Baidu has focused on launching local-language versions of its search engine. And it has also looked to expand its footprint through other services. In Indonesia, Baidu has its own Android app store called MoboMarket.

But Europe and the U.S. are two completely different beasts, dominated by U.S. search giant Google. Getting a foothold in these markets will be difficult given the prevalence of Google, particularly on mobile where its Android operating system is the dominant OS in both U.S. and Europe.

On top of that, Baidu will have to deal with different regulation, which at times has been unfavorable to Chinese companies, particularly in the U.S.

It’s unclear what strategy Baidu might employ to expand into Europe or the U.S. So far, Baidu has invested in U.S. firms such as Uber and could use this to get a foothold in certain markets.

Other Chinese internet behemoths have already started to expand into Europe – the U.S. E-commerce giant Alibaba for example hired country managersin Italy and the U.K. last year. And its payment service Alipay, has been building partnerships with European companies, to allow Chinese tourists abroad to use the app to pay for items. Alibaba has focused on allowing Chinese consumers to use its services abroad, or to help businesses sell into China. This is potentially something that Baidu could do.

Baidu has a mapping service which currently will help Chinese tourists find local hotels or restaurants wherever they are, something Li said the company could expand on.

“We will start from here and we will gradually expand into other areas,” Li said.

‘Will search still be relevant?’

The Baidu CEO also spoke about the broader search market, questioning how relevant it will remain in the face of challenges from the likes of Facebook.

“We face a new problem. Will search still be relevant? Going forward people can directly go to WeChat, go to Facebook….go to a lot of different apps. Do they still need search? And we need to worry about this problem. We need to address this kind of new consumer behavior, we need to keep innovating, we need to come up with better solutions for our users,” Li said.

Facebook has recently opened up its Messenger platform for developers to create chatbots – apps within the service that can do anything from help people order flowers to answer customer service questions. Users can even get the news or weather, something they may have typically gone to a search engine for. And WeChat, China’s biggest messaging app which is owned by Tencent, also has bots on its platform.

With the threat from non-traditional search players looming, Li said Baidu has been focusing on other areas. Like Google, Baidu has beentrialing driverless cars. But it has also been expanding into other areas such as finance, where Li said that Baidu could potentially offer loans to people.

“There are a lot more opportunities…I think people will still rely on search for a lot of things, information…but we can actually do a lot more,” Li said.

Source: CNBC