# Baidu - ADEX557 Digital Strategy | Blog Post 2


In the year 2000, Robin Li and Eric Xu, two Chinese entrepreneurs came together in Beijing (meaning hundreds of time), to launch the internet start-up, Baidu. Over time, it has become China’s most popular search engine (70% of all search is done via Baidu) and become one of the country’s tech titans. Baidu is often referred to as the “Google of China”. It commands around 70% of China’s internet searches and, given China’s massive population, it’s among the world’s most used search engines.

In the years that followed, Baidu did not remain just an internet company, but turned its operating model into the field of artificial intelligence and started to invest in AI in 2010. Baidu has many products in AI, large and small, that it continues to invest in, but some of the highlights include: Baidu Search (understanding language to find relevant results that even user might not be aware of), DuerOS (voice assistant with natural language processing), Apollo, Robocar (autonomous driving), Deep Voice (Text-to-speech system with deep neural networks), and many more.

Although these products are not heard for the first time, Baidu's integrating artificial intelligence into these products adds significant value to the company by increasing the efficiency of the product and the benefit gained by the users. In addition to the technological value, the effectiveness of the advertisements shown to the users increases with the artificial intelligence used in "Baidu Search", and this strengthens the company's budget financially.

I want to draw more attention to Baidu's investment in autonomous vehicles to demonstrate how they took advantage of AI in expanding their business model. Despite Baidu started as an internet company, it created a new business model for itself by integrating its experience from artificial intelligence and the applications it created into its new autonomous vehicle, which seems to be a completely different field. To give a concrete example, they managed to use their voice assistant, DuerOS, in the car.

More than that, to achieve and maintain these developments successfully, Baidu established a non-commercial Baidu Research collaborating with academicians and colleges not only across the China but all over the world; making research on disruptive AI technologies.

Considering artificial intelligence technology, it is fundamentally different from previous technology waves which is that data plays a crucial role. The company might have talented, crowded, and experienced engineering staff which is not enough alone to be successful. The most important input for the use and development of artificial intelligence is big data. Here is a very impressive example from Qi Lu, COO of Baidu and who in charge of AI strategy; a human is born with the code implemented inside its brain; however it learns from data collected in time through its sensory and perceptive systems. (For more, see Baidu’s COO, Qi Ku Discusses AI with Daniel Gross, YouTube Interview) Same applies with the AI technology. Baiduis aware of the opportunity of being in China which has a huge advantage in this regard. First, Baidu has ability to reach more than 1.1 billion devices and has 174 million daily users, last updated in March 2019 which makes for Baidu easy to collect tremendous amount of data. China has the population of 1.4 billion people and exceeding 1 billion smart phone user which creates a unique data environment for Baidu.

In addition, it is not the sole opportunity of Baidu has. China knows that they missed the previous technology revolutions and this loss left itself behind in many areas, especially in the economy, but this time it sees the promise of artificial intelligence in the future and provides all kinds of support to its companies in this wave of technology. They are easing collecting data, giving financial incentives, and adapting laws, -mainly in autonomous driving. (See: Baidu COO says China’s government will help the country dominate AI)

On the other hand, Baidu also faces several challenges in the industry. First of all, for Baidu, the Chinese Government creates challenges as well as opportunities. Like all Chinese internet companies, Baidu is subject to China’s strict online censorship which limits Baidu’s range of motion. In 2017 and 2021, China has imposed fines on Baidu ( for not dealing with the rules. However, Baidu always feels the pressure of strict rules, censorship, and even risk of to be overtaken by government. To overcome similar problems and expand its portfolio, Baidu also invested in different markets. As an example, it has been listed on the Nasdaq since 2005 which proved to be a smart move, with China restricting foreign public offerings in the following years.

Besides, as with other artificial intelligence companies, privacy and ethics pose a significant issue. For the development of artificial intelligence, personal data must also be used for other than their purposes which rise privacy challenges of AI (Beware the Privacy Violations in Artificial Intelligence Applications). The fact that there is not enough legal regulation in this area yet and the security gaps experienced (Baidu apps found to be ‘leaking personal data’, Warning: Banned Baidu Apps Exposed ‘Sensitive’ Data On Millions Of Android Phones ) support this thesis. A study conducted in May 2019 (A privacy policy study of Alibaba, Baidu and Tencent) showed that the security rules that companies claim on paper do not match what happens in practice. In these days when security concerns are on the rise, Baidu can work on artificial intelligence to securely store data in order to both provide trust and bring itself to the fore in this field. Security applications with artificial intelligence can more wisely provide protection against threats, both on personal devices and on an enterprise basis.

Sources are linked inside the post for easier access.

More detailed and visualized data will be provided via infographic in the blog-post-3