Thursday, July 31, 2008

New president for Baidu Japan

Baidu announced on Friday that it has appointed former
Yahoo Japan search vice president Jinshang Junyi as
president of Baidu's Japanese subsidiary, effective
August 1, reports Sohu. Jinshang Junyi served as
chief technology officer of Excite Japan for six
years before joining Yahoo as vice president in
2004, said the report. Baidu officially launched its
Japan business in January. The Beijing-based company
expects to spend between $20 million and $25 million
on Japanese search service development this year. partnership

Shanghai-based online video site,
a unit of BroadWebAsia announced on Wednesday
that it has partnered with Baidu to mark its
transformation from a video site into an
entertainment location, according to
CEO Davis Li. Under the agreement,
will provide Baidu with exclusive interviews,
videos and other content while Baidu will
promote content to its users.
had recorded over two million registered
users and 40 million unique visitors per
month, with 70% of visitors coming from
search engines, by May.

Wednesday, July 30, 2008

Baidu interested in Taiwan, selects Japanese CEO

Robin Li told an audience in Taipei on Wednesday
that Baidu sees Taiwan as a potential market,
reports Techweb citing Taiwan's Economic Daily
News. Despite his statement of "obvious interest"
in the island, the chief executive said Baidu
does not currently have any specific plans for
Taiwan entry.

Baidu has already selected a "youthful, local"
man to take over as president of Baidu Japan,
and is expected to release the news this week,
reports Sina quoting a Baidu Japan insider.
An unnamed insider said the new president
worked previously at either Google or Yahoo
Japan, reports Sohu, while the Baidu insider
said the new executive has search technology
and operations experience. Baidu expects to
spend between $20 million and $25 million on
search service development in the Japanese
market this year.

Baidu's nationwide tour to attract sellers to
its consumer-to-consumer (C2C) e-commerce
platform reached its fifth city, Wuhan, on
July 30, reports Beginning in
Beijing on June 18, the promotional trail has
rolled through Beijing, Ningbo, Guangzhou and
Nanjing. Baidu is gearing up to release its
C2C platform before year end.

Tuesday, July 29, 2008

Calendar function added to Post bar

Baidu added calendars to its online forum channel
Baidu Post Bar on Thursday. Administrators have
the power to add information to the calendar
that appears in their forum. The calendars are
pre-marked with Olympic competitions and public

Sunday, July 27, 2008

Tie up with Northgate technologies

Northgate Technologies, an Indian technology,
e-commerce and online advertisement solutions
provider, has formed partnerships with Chinese
advertising giant Baidu, the company said in
a statement released on Thursday.

The statement said that Globe7 HK Limited, a
wholly-owned subsidiary of Northgate
Technologies, has formed partnerships with
Chinese advertising giants Baidu, Alimama and
Allyes, which will build Chinese advertising
exposure to its products,, and

The partnership with Allyes, one of China's
largest online agencies, allows the exchange
of advertising on Allyes' SmartTrade with
Axill China, Globe7's recently launched
advertising platform for the Chinese-speaking

GS raises PT to $350

Baidu price target raised at Goldman to $350
from $310 based on Q2 results that included
solid revenue growth and lower-than-expected
traffic acquisition costs. See improved
earnings potential in 2009 and 2010 based
on margin expansion. Maintained Neutral rating.

Zacks sets PT of $450

The financial results for the second quarter again
exceeded the market consensus. With China's most
popular search engine, Baidu has an advantage over
rivals in China's fast-growing online advertising
market. In addition, Baidu continues to expand its
product lines to attract users and boost revenue.

Although fierce competition from Google prevents
Baidu from building a wide economic moat and Baidu's
Japan expansion will continue to negatively affect
its financial results, we think Baidu is currently
undervalued based on its growth prospects. Therefore,
we are maintaining Buy recommendation for Baidu's

The stock is currently trading at 65.5x our estimate
for fiscal year 2008 earnings per share, which is
significantly higher than the industry mean and that
of its Chinese peers. The stock is also trading at
42.2x our estimate for fiscal year 2009 earnings per
share. Using a P/E multiple of approximately 65.8x
our fiscal year 2009 earnings per share estimate
yields a target price of $450.00, which we believe
reflects the company's growth prospects.

Friday, July 25, 2008

JP Morgan bullish

JP Morgan said it is raising its full-year earnings
estimates for Baidu by 1-2 pct on expectations of a
strong performance in the next few reporting periods.

"We stay bullish. Baidu shall see high growth in
quarters ahead, with higher search adoption and
Internet penetration," JP Morgan said.

Baidu reported second quarter revenue of 802.6 mln
yuan, up 100 pct year on year, which JP Morgan said
was ahead of its forecast.

JP Morgan has an "overweight" recommendation on the
stock and a 380.00 usd price target.

Piper raises PT to $468

Piper Jaffray analysts Gene Munster and Vivian B. Li
increased their price target from $430 to $468 and
maintained their Buy rating. In addition, they
increased their FY 08 EPS estimate from $4.00 to $4.25,
and raised their FY 09 EPS estimate from $6.14 to $6.68.

The analysts said, "Baidu reported a solid June quarter,
and guided in line with the Street estimate for the Sept
qtr. We believe the company's business remains strong
given: 1) healthy growth in term of both number of
customers (up 41%y/y) and ARPU (up 59% y/y), 2) it is
acquiring more large advertisers in addition to the usual
SMEs, 3) positive traction with new products such as
My Marketing Center, 4) improved margin, and 5) clear
focus on improving search relevance, monetization
capacity, and sales and customer service quality."

In addition, they highlighted Baidu management views
the Olympics as a as a two-month event (7/20-9/20) rather
than the typical Street thinking of a two-week event
(8/8-8/24). Management emphasizes the long term benefit
of attracting internet users to use Baidu search through
the event. However, the analysts believe the company will
face some headwinds "during the game period given traffic
is likely to decrease as users are distracted by the Game,
as well as business and marketing activities being slow
given government is regulating traffic and pollution."

They believe Baidu’s margins "will remain stable in the
lower 30%'s range for the next couple quarters given
that 1) there is still room to grow in terms of bringing
down bandwidth and depreciation cost, 2) no plans for
high promotional cost during the Olympics, 3) no plans
to increase headcount significantly (currently 6800
employees), and 4) previous guidance of $20-25m spending
on Baidu Japan still on track."

Thursday, July 24, 2008

Analyst take on Q2 08

RBC Capital Markets noted that the guidance reflects
"uncertainty in traffic patterns around the games.

"There will also be disturbances to the normal
course of business around Beijing, which will
likely affect advertiser spending in that area,"
said analysts Stephen Ju, David Bank and Ross
Sandler in a note to investors. They kept an
"Outperform" rating on the shares, but reduced
their price target by $1 to $384.

Citi Investment Research analysts Jason
Brueschke and Catherine Leung are more
optimistic, keeping a "Buy" rating and
$415 price target. "Despite concerns over
potential disruptions from the Olympics on
Baidu's 3Q, the company gave guidance that
was reassuring enough to allay concerns
over significant impact, in our view."

Wednesday, July 23, 2008

Baidu widens lead over Google per Analysys

Baidu expanded its lead over Google in China's
search engine market in the second quarter,
research firm Analysys International said
Wednesday. In the three months ended June 30,
Baidu had 64.4% of the search engine market by
revenue, up from 60.7% in the first quarter,
Analysys said in a report. Google's share of
the market fell to 26.1% in the second quarter
from 26.8% in the first quarter. China's total
search engine revenues rose 87% from a year
earlier to CNY1.23 billion on increased
advertising spending by small and medium-sized
enterprises, the report said. Analysys said the
Beijing Olympics in the third quarter will
likely drive increased demand for Web searches
in China and further advertising spending by
small and medium enterprises. Distant
third-place contender Yahoo China continued to
lose ground.

Sunday, July 20, 2008

iResearch numbers for Q2 08

Baidu market share at 62.8%, Google at
26.2%. 2008Q2 Chinese search engine market
reached 1.261 billion yuan, up from 2007 Q2
of 641 million yuan. Estimated 08 Q3 market
will be more than 1.6 billion yuan, up
nearly 100 percent

Thursday, July 17, 2008

DCCI: Baidu's search market share at 69%

Google at 12.5%. Based on the Data Center of
the China Internet (DCCI)'s new H1 2008 Report
on Monitoring of Chinese Internet Sites Based
on IMI Indicators.

Baidu accepting applications to create new IM groups

Baidu is accepting applications for 1,000 new Baidu Hi,
instant messaging (IM), groups from July 15 to 31.
Baidu requires approved groups to reach a minimum of
five members within a one-week period to continue
operation. The IM software does not enable users to
create their own groups.

Friday, July 11, 2008

Online dictionary service

Baidu updated its online dictionary service
( this week to support free
English translations of up to 1,000 Chinese
characters at a time, reports Hexun. The
service also offers Chinese to English
translations. The report said most free
translation services support up to
150 characters, making Baidu's upgraded
capacity the largest in China. Baidu
released its online dictionary service
in 2004.

Tuesday, July 8, 2008

Piper maintains buy rating

Piper Jaffray analysts Gene Munster and
Vivian Li preview Baidu's June quarter.
They maintain their Buy rating and $430
price target.

Their checks indicate that the June quarter
is tracking slightly above Street estimates
of $112 million in revenue and $0.97 in EPS.

The analysts said, "We expect Baidu to report
slight upside to the Street's estimate of $112m
in revenue, despite concerns over the China
earthquake in May. From our conversation with
4 Baidu advertisers and 2 ad agencies, we believe
Baidu's business remains robust given
1) consistent addition of new customers as
advertisers continue to adapt to paid search
marketing and 2) increased ARPU from bundled
sales of Baidu's display ad and search ad."

They also believe that there is a small negative
impact from the Chinese earthquake on the
company's business "as traffic and small and medium
advertisers in the earthquake area were both
affected." However, the expected impact is not

The street expects revenue of $135 million for
the Q308, up 21% sequentially while the analysts
current revenue estimate for 3Q08 implies
sequential growth of 19%. If Baidu beats the
street in Q208, the analysts highlighted that
sequential growth from June to September
will likely fall below 21%, as the percentage
growth would decline with higher Q2 revenue.

Finally, a decline in Baidu's growth rate is
not a caution signal, rather it is a sign of
the law of large numbers.

Monday, July 7, 2008

Teaming up with Nokia

Baidu is now offering its mobile search service on
Nokia's mobile widget service "WidSets", reports The report said that there were
10 million WidSets users worldwide, including
four million in China. Nokia plans to pre-install
WidSets in tens of millions of mobile phones this
year, said the report. Currently users can download
the Widset service to their phones in order to use
Baidu and all other partners' programs. Nokia
launched WidSets ( in China last May.
Baidu previously partnered with Nokia to preload
its search service in selected Nokia handsets.