The 2010 China (Shenzhen) IT Leaders Summit, co-hosted by the Shenzhen Municipal People's Government and the Digital China Federation, was grandly held today at the Wuzhou Hotel in Shenzhen. Sohu IT, as a full strategic partner, provided video and pictorial live coverage of the summit.
Baidu CEO Robin Li, in response to host Liu Erfei's question about the current competitive situation in the search industry, stated that he is not worried about whether Google's exit will lead to Baidu becoming a dominant player.
Here is the full text of his response:
Robin Li: This matter has been going on for more than two months. It has involved many people's attention - be it Chinese or Americans or others. Personally, I feel a lot of pressure. Many people have followed this issue closely, and I don't know why so many people care about it so much.
I remember when Tencent beat MSN and Taobao beat eBay, no one discussed this issue then. Now it’s our turn, and suddenly so many people are paying attention. So, I still feel a lot of pressure.
One concern is directed towards us. The concern is that if Baidu becomes the dominant player, will there be no competition left? Will Baidu's technological progress slow down? Will Baidu's user experience get worse? Will there be more ads on Baidu's page? Let me address this. I believe this will not happen.
My conclusion is based on the following reasons: the search industry is a very attractive industry, which everyone now understands. It involves high technology content, a large market, rapid growth, and an excellent business model. Therefore, it attracts many people. Meanwhile, China's search market is still in a stage of rapid growth. My prediction is that in the next five years or so, China's search market will still be a rapidly growing market.
Thirdly, China's Internet actually does not have too many entry barriers, unlike telephone companies. If you want to start a telephone company, that's not possible without corresponding approval. In fact, there are no private telephone companies up to now. But if someone wants to start a search engine, probably no one would stop them. This market is rapidly growing, has great potential, and has no significant entry barrier, at least no policy barrier. Thus, new challenges will keep emerging.
Back in the late 90s, if you were involved with the Internet, you might recall that the global search market was also dominated by one company, which was Yahoo. Later, a newer and better search engine appeared, quickly replacing the previously dominant search engine company.
So, as long as the market is changing rapidly and keeps offering new opportunities and hope, innovation will continue to emerge, and new competitors will keep joining. Even now, soso is doing quite well. We also have Sogou from Sohu, Youdao from NetEase, Bing from Microsoft, and Yahoo, among other options. I believe this will still be a highly competitive industry in the future, so please don't worry about this aspect.