Reuters
Baidu CEO says ad sales picked up since late Jan
Fri Apr 17, 2009 1:04pm EDT
BOAO, China, April 17 (Reuters) - China's top Internet search company Baidu Inc (BIDU.O) said on Friday it had seen a significant rise in advertising since late January, as business sentiment improved in the world's third largest economy.
The Chinese economy has recovered in recent months, prompting Baidu's customers to spend more on advertising, Robin Li, the firm's chairman and chief executive officer, told reporters on the sidelines of the Boao Forum.
"Our data suggests that the confidence of many consumers and companies has been picking up rather rapidly since the Spring Festival," said Li, referring to the start of the Chinese Lunar New Year, which took place in late January this year.
The comments come after China posted this week its slowest quarterly growth on record in the first three months of 2008, while recent urban fixed-asset investment and industrial output growth showed signs that the economy may have hit bottom.
Baidu's advertising sales had been hit by the slowdown in China's economy and after the government forced it to remove paid listings from questionable medical firms.
The advertising industry in China, however, could face an abrupt slowdown this year, CTR Market Research said, as small-and-medium enterprises are particularly vulnerable to economic volatility.
There are some 200,000 active online marketing customers in various sectors running advertisements on Baidu, most of which have seen encouraging signs of business after the Spring Festival, Li said.
Baidu's fourth quarter net profit rose to $42.3 million, up 40 percent from a year earlier, but fell short of Wall Street expectations. [ID:nN18464551]
Li also said the company's investment in its Japanese language website would continue as scheduled, unchanged by the economic downturn.
"For a market as big as Japan, it requires years of patience to bear fruits," he said.
The company aims to have 70 percent of total revenue come from overseas markets in 15 years, Li said.
The company's reach overseas comes as global search leader Google Inc (GOOG.O) makes inroads into China.
Google launched free downloads of licensed songs last month in China, while sharing advertising revenue with major music labels in a market rife with online piracy.
Li said the focus of Baidu is to better organise resources available on the Internet, including music files, rather than becoming a music information provider.
Baidu trails Google and Yahoo Inc (YHOO.O) in Internet searches worldwide, but is by far the No.1 player in China, according to research firm comScore. ($=6.83 yuan) (Reporting by Michael Wei and Kirby Chien; Editing by Jon Loades-Carter) |
