While Baidu holds a strong leadership position in China’s search engine market, holding a 60.1% share at the end of the fourth quarter of 2007 (to Google’s 25.9% share), it has yet to set foot in the instant messaging market in its homeland. This will soon change with Baidu Hi, the search engine’s homemade IM service, which is currently in beta testing.
Baidu Hi is being tested internally, and there has been no date set for a public release. It has been in the works for about a year, according to a statement made by the company.
The IM service will encounter strong competition from Tencent’s QQ instant messaging service, which currently holds 79% of the IM market in China. Microsoft’s MSN Messenger is second in the market, though far behind Tencent.
Part of the reason for Baidu’s interest in establishing itself in the IM market is to perpetuate its rapid growth. Since 2005, Baidu has experienced annual growth rates of over 100%. This growth is expected to decline to about 30% within five years, so new strategic products such as Baidu Hi will be aimed at sustaining strong growth.
It is unclear what features will be available with the IM service. Some sort of synergy with phone services or VoIP should be expected, as these features have gained traction in virtually all other major IM services.
It will be interesting to see whether or not a file sharing feature will be available with Baidu Hi, given the potential censorship issues that could lie in that arena. This is especially interesting in light of Baidu’s recent legal troubles for allowing its users to search for unsecured MP3s on its search engine.
Mobile phone synchronization will almost definitely be available with Baidu Hi. While QQ utilizes advertisements in various forms (even drawing “adware” labels from peeved users and organizations), and also uses its own “currency” which users accumulate to pay for avatars, it remains to be seen if Baidu will opt to reap financial rewards from its IM service through similar means.
Sources:
http://www.pcworld.com/article/id,143022/article.html
http://mashable.com/2008/02/29/baidu-hi/
http://news.xinhuanet.com/english/2008-03/01/content_7695776.htm
http://www.marketingvox.com/archives/2008/01/29/
baidu-third-largest-search-property-worldwide-beats-google-in-china/
Jason Hahn
e: jhahn221@gmail.com
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