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American Google vs. Chinese Baidu

8. 05. 2017 10:56:06
Chinese searching engine Baidu is sometimes called as "Google in China", but is that true? Can be Baidu compared with Google?

Indroduction

I want to compare two technology companies. Those are American Google and Chinese Baidu. I’m interested in technology, innovations and marketing so when I was choosing the topic, I wanted to compare something from Western technology world with the Chinese one. My first idea was to compare Facebook and Tencent. Facebook is really popular social network around the world but it’s censored in China. On the other hand Tencent has two apps which could be compare with Facebook – WeChat and QQ. I was also thinking about comparing two e-commerce companies Amazon and Alibaba. Both’s main business is providing sales via web portals. However, I decided to describe the main differences between Google and Baidu, which is sometimes called as “Google in China” (1).

According to “List of largest Internet companies” on Wikipedia.org (2) the chosen companies belong between the first seven largest one in the world. Google (Alphabet) is on the second position and Baidu on the seventh. Normally I do not use Wikipedia as the resource, but in this case every data are with references and I want to use here just for the illustration.

Both compared companies are really huge so that’s why I decided for briefly describing and not so deeply one.

Google vs. Baidu

Even though Google is owned by Alphabet, I want to compare it as Google for this work, because it’s more known. Alphabet is the parent company for Google since reorganization 2015. It happened because they wanted to separate Google’s main businesses such as searching engine, ads, maps and Android from the other ones (3).

Google was founded in 1998 by Larry Page and Sergey Brin in California, USA. They built searching engine named Backrub, however soon after was renamed to Google. Name google comes from “googol” which means “the mathematical expression for the number 1 followed by 100 zeros and aptly reflected Larry and Sergey's mission “to organize the world’s information and make it universally accessible and useful (4).” Nowadays Google became the second most valuable brand in the world with brand value $133,252 mil. (5).

Baidu story started in Beijing in 2000. As Google, Baidu first service was searching engine. The name was inspirited by a poem 800 years old. “The poem compares the search for a retreating beauty amid chaotic glamour with the search for one's dreams while confronted by life's many obstacles. Baidu literally means "a hundred times" (6).

Both companies are known for their popular search engines, email services, maps etc. So where is the biggest different?

According to Forbes ranking “Global 2000” 2016 (7), which is the list with the world’s biggest public companies, is Alphabet a.k.a. Google on the 27th position and Baidu on the 349th. The difference in market cap is really huge, $500.1 Billion by Google and $66.1 Billion by Baidu.

Based on my opinion, one of the main differences are languages they are offered in. You can use Google in 123 different languages but Baidu is just in Chinese. There is no way how to switch Baidu into another language including maps or email. For me as non-chinese speaker it’s almost impossible to use Baidu. Speaking of email, if you don’t have Chinese phone number, you are not able to register new email on Baidu. Anyway, there is one reason why is it like that. Baidu is primary focused on Chinese and China in general. Baidu understands Chinese language, habits and culture much more than Google. Visitors of Baidu come in 92.4 % from China and visitors of Google just in 33.8 % from the USA, rest is around the world (8).

Focusing on searching engine area, Baidu is the first one in search queries in China (82 %) and Google’s subsidiaries (especially in Hong Kong and Taiwan) have only 10 % of the market. It can be caused because of censorship of Google in China. It began in 2010 after hacking attack when Google started to redirect all search queries from Google.cn to Google.com.hk, which returned results without censorship. The fight finished in 2014 when Google’s services as Gmail, YouTube, Google Search etc. are not available since (9). Anyway, there is still one very popular Google’s product - Android. The operation system for phones which covers 74.4 % of smartphone users in China (10). There are circa 601.8 mil smartphone users in whole China (11) which means Google covers 447.7 mil users.

Comparing the all world data, the numbers are totally different. Baidu search queries are really small piece of cake 0.5 % and Google controls 89 % of searching globally (12).

The operation system Android isn’t the only popular product of Google. YouTube is the most popular video-sharing website which was bought by Google in 2006. YouTube gets over 30 million visitors per day (13). Other popular Google services are Google Maps, Gmail, Google Drive (cloud storage service), the world’s mostly used web-browser Chrome, or hardware products such as Chromebook and phones Nexus and Pixel.

Baidu’s business includes also map service. Until end of 2016 Baidu Maps covered only Chinese territory. However that time was really evolutionally because Baidu started to cooperate with mapping company Here. Here was founded by one of the most popular phone producer Nokia, but in 2015 sold Here to BMW, Audi and Daimler. Nowadays, Baidu Maps supports around 200 countries and has more than 350 million active users globally (14). Despite those facts, Baidu Maps is still just in Chinese languages. Baidu also provides cloud storage called Netdisk or Video server which competes with Youku, probably number one video site in China.

Google’s and Baidu’s revenues mostly come from online advertisement or marketing. In 2016 Google generates revenue 89.46 bilion U.S. dollars, 79.39 bilion was from ads (88.73 %). Baidu’s revenue in 2016 was 10.16 bilion U.S. dollars and their income came in 99.7 % from online marketing (15) (16) (17) (18). In the graph below I compare Google’s total revenue, revenue from advertisement and Baidu total revenue.

Resource: Based on data from Statista.com (2017)

My conclusion of this battle is that even though Google and Baidu offer the same product - searching engine, Google is worldwide company, one of the biggest one. Baidu operates mainly in Chinese market. We can just discuss how it would be if Chinese internet was without censorship and Google could be on Chinese market without any restriction. If Google beats Baidu or would be beaten by Baidu. Anyway, if Baidu wanted to extend to the world, there wouldn’t be just one competitor in searching engine Google but also Yahoo! which covers 3.1 % of the market and Bing 4.6 % (12) and must provide their pages also in other worldwide languages, not just in Chinese.

(Podle idnes kodexu blogera odkaz na český překlad - zde)

Resources

1. Bloomberg. The Baidu Billionaire: Inside the Google of China. Bloomberg . [Online] unknown. [Cited: May 7, 2017.] https://www.bloomberg.com/news/videos/b/bb078fff-86df-4fa2-85c8-d92f085ab91f.

2. Wikipedia. List of largest Internet companies. Wikipedia. [Online] unknown. [Cited: Apr. 30, 2017.] https://en.wikipedia.org/wiki/List_of_largest_Internet_companies.

3. Drake Baer. The totally nuts reason Google is changing its name to Alphabet. Business Insider. [Online] Aug. 10, 2015. [Cited: Apr. 30, 2017.] http://www.businessinsider.com/why-google-is-changing-its-name-to-alphabet-2015-8.

4. Google Inc. From the garage to the Googleplex. About Google. [Online] unknown. [Cited: Apr. 30, 2017.] https://www.google.com/intl/en/about/our-story/.

5. Interbrand. Best Global Brands 2016. Interbrand. [Online] 2016. [Cited: Apr. 30, 2017.] http://interbrand.com/best-brands/best-global-brands/2016/ranking/google/.

6. Baidu. About Baidu. Baidu. [Online] unknown. [Cited: Apr. 30, 2017.] http://ir.baidu.com/phoenix.zhtml?c=188488&p=irol-homeprofile.

7. Forbes. Global 2000. Forbes. [Online] 2016. [Cited: Apr. 30, 2017.] https://www.forbes.com/global2000/list/.

8. Alexa.com. The top 500 sites on the web. Alexa.com. [Online] 2017. [Cited: Apr. 30, 2017.] http://www.alexa.com/topsites.

9. Wikipedia. Google China. Wikipedia. [Online] unknown. [Cited: Apr. 30, 2017.] https://en.wikipedia.org/wiki/Google_China.

10. Statista. Market share held by mobile operating systems in China from January 2012 to February 2017. Statista. [Online] Feb 2017. [Cited: Apr. 30, 2017.] https://www.statista.com/statistics/262176/market-share-held-by-mobile-operating-systems-in-china/.

11. —. Forecast of smartphone users in China. Statista. [Online] 2017. [Cited: Apr. 30, 2017.] https://www.statista.com/statistics/467160/forecast-of-smartphone-users-in-china/.

12. —. Worldwide Market Share of search engines. Statista. [Online] Jan. 2017. [Cited: Apr. 30, 2017.] https://www.statista.com/statistics/216573/worldwide-market-share-of-search-engines/.

13. Fortune Lords. 36 Mind Blowing YouTube Facts, Figures and Statistics – 2017. Fortune Lords. [Online] Mar. 23, 2017. [Cited: May 7, 2017.] https://fortunelords.com/youtube-statistics/.

14. Shead, Sam. The 'Google of China' wants to plot the world with a mapping company owned by Audi, BMW, and Daimler. Business Insider. [Online] Jan. 16, 2017. [Cited: May 7, 2017.] http://uk.businessinsider.com/baidu-partners-with-a-mapping-company-owned-by-audi-bmw-and-daimler-to-plot-the-world-2017-1.

15. Statista. Annual revenue of Baidu. Statista. [Online] 2016. [Cited: May 7, 2017.] https://www.statista.com/statistics/269032/annual-revenue-of-baidu/.

16. —. Google's revenue worldwide. Statista. [Online] 2016. [Cited: May 7, 2017.] https://www.statista.com/statistics/266206/googles-annual-global-revenue/.

17. —. Google's ad revenue. Statista. [Online] 2016. [Cited: May 7, 2017.] https://www.statista.com/statistics/266249/advertising-revenue-of-google/.

18. Seth, Shobhit. Baidu Vs. Google: How Are They Different? Investopedia. [Online] May 12, 2015. [Cited: May 7, 2017.] http://www.investopedia.com/articles/investing/051215/baidu-vs-google-how-are-they-different.asp.

Autor: Tomáš Rak | pondělí 8.5.2017 10:56 | karma článku: 7.79 | přečteno: 323x

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Jsem studentem Vysoké školy ekonomické, Praha, Fakulty managementu v Jindřichově Hradci. Témata, kterým se věnuji se týkají především nových trendů v marketingu a technologiích.



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