Baidu Expands Mobile Search With Apps That Aren’t Downloaded

Baidu Inc. (BIDU), owner of China’s largest search engine, is expanding with mobile applications that don’t need to be downloaded as it competes with Tencent Holdings Ltd. (700) for users in the world’s biggest smartphone market.

Mobile users can access so called “lite apps” for transportation, travel and entertainment information through Baidu’s search program on smartphones, Li Mingyuan, a vice president, said today in Beijing. Baidu is also offering mobile payment services for developers to commercialize their applications, he said.

Baidu is trying to navigate a shift from desktop computing, where it manages 82 percent of the nation’s searches, to mobile devices. The company last month agreed to pay $1.85 billion for the 91 Wireless third-party app store in its biggest announced acquisition to capture the nation’s more than 464 million users who access the Internet from mobile devices.

“We are pushing the development of China’s Internet ecosystem,” said Li Mingyuan. “We hope by promoting ‘lite’ apps to help developers integrate mobile and cloud systems.”

The company’s app store has had 69 million downloads every day as its open platform attracts 700,000 developers, Chairman Robin Li said at the conference.

Baidu’s mobile revenue was about 700 million yuan to 800 million yuan in the second quarter, Chief Financial Officer Jennifer Li said in an interview on Bloomberg TV in July. The company has a market share “well above” 50 percent in searches from mobile devices, she said at the time.

Acquisitions

“Baidu has been relatively fast in commercializing its mobile services,” said Lucy Zhang, a Beijing-based analyst at Internet consulting group IResearch. “It’s trying to build a mobile cloud ecosystem to help developers build its more mobile services on its platform.”

The company is still actively looking for acquisition targets, as it expands in services such as online search and Internet video.

Baidu reported net income of 2.64 billion yuan ($431 million) in the second quarter, beating analyst estimates. Revenue rose 39 percent to 7.56 billion yuan.

Baidu boosted its workforce by 2,100 people to 24,000 by the end of June through new hires and the purchase of PPStream Inc. for $370 million in the June quarter.

Baidu will merge PPS with recently acquired online video unit iQiyi.com, making the platform China’s largest online video site by mobile user numbers and viewing time, according to an e-mailed statement from the company in May.

China’s online video business revenue is projected to increase to 16.2 billion yuan in 2014 from 1.36 billion yuan in 2009, according to IResearch.

The number of people who accessed the Internet via mobile devices reached 464 million at the end of December, according to China Internet Network Information Center’s website.

To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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