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Baidu.com bursts onto search-engine scene

Baidu.com (百度) takes its name from a 900-year-old poem but its ambitions are ultramodern -- to become the Chinese-language equivalent of Internet search giant Google Inc.

Little known abroad, 5-year-old Baidu.com says it already is the world's sixth most-visited Internet site, thanks to a strong following from China's 100 million-plus Web surfers.

Now the startup founded by two Chinese veterans of US tech firms is preparing to follow Google's example with an initial public offering (IPO) in the US, hoping to raise US$45 million. A date for the offering has not been announced.

Baidu.com is in the front ranks of an emerging group of Chinese companies that are trying to create Internet services uniquely suited to their country's ideogram-based language and the political restrictions of its communist government.

"Here's a homegrown company that has created what really is a very strong search product," said David Wolf, managing director of Wolf Group Asia, a Beijing-based consulting firm.

Baidu.com was founded in 2000 by Robin Li (李彥宏), who earned a master's degree in computer science from the State University of New York at Buffalo and worked for US search engine firm Infoseek, and Eric Xu (徐勇), a Ph.D from Texas A&M and a veteran of American biotech firms. Xu is no longer with Baidu.com.

The name means "one hundred times." It comes from a Song dynasty poem and refers to a man ardently searching for his lover in a festival crowd.

It didn't take Google long to see the firm's potential. It bought 2.6 percent of Baidu.com last year in a move that outsiders thought might lead to the US search engine taking over the tiny Chinese startup. But Baidu.com has stayed independent.

Google's influence shows, though, in Baidu.com's spare white Web site that is nearly identical to its investor's.

By contrast, competitor 3721.com -- bought in 2003 by US-based Yahoo! -- is a busier, colorful site with animated graphics.

Other early backers include US-based venture capital firms with a reputation for spotting promising newcomers: Draper Fisher Jurvetson -- Baidu.com's biggest shareholder, with a 28 percent stake -- and the investment arm of International Data Group.

Baidu.com's IPO is modest beside the US$1.2 billion that Google raised through its public offering last August. But its tentative price for the block of shares being offered values the whole Chinese company at US$650 million.

But the company says it is already making money.

China's communist government promotes Internet use for business and education. But it has also launched sweeping efforts to police online content, blocking access to material deemed subversive or pornographic.

The extent of the censorship controls has been highlighted by the changes that foreign companies make when they launch Chinese versions of their services.

Free-speech activists criticized Microsoft Corp when the blogging section of its recently launched China-based Web portal rejected such words as democracy, freedom and human rights, labeling them "forbidden language."

A search on Google's China-based service for such topics as Taiwan, the Dalai Lama or the banned spiritual group Falun Gong returns a message that says "site cannot be found."

Baidu.com, 3721.com and other Chinese search engines also face daunting linguistic challenges that designers working in English and most other languages don't.

Chinese uses thousands of ideograms. On a computer, they usually are written by typing words phonetically in Roman letters, then using special software to convert them to characters.

Making things even more complex, China's communist leaders simplified many characters after the 1949 revolution, while Taiwan, Hong Kong, Singapore and other societies use the old system.

So a search engine must sift through twice as many characters. And Chinese is written without spaces between words, making it hard for a machine to figure out where one ends and the next begins.
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