Baidu shuts down Twitter-like service

Baidu retreats from China's booming microblogging market

China's largest search engine Baidu has pulled back from the country's Twitter-like services market after the company said it would shutdown its own microblogging website.

Called Baidu Talk in English, the site was search giant's attempt to tap into the country's booming microblogging market. Rival sites from Chinese companies have established their own Twitter-like services, with active microblogging users now at 174 million, according to Beijing-based research firm Analysys International.

Baidu Talk was launched last September as a social networking platform that incorporated Twitter-like features. But the site had tried to set itself apart from the competition by originally requiring all users to register with their real names.

In the first three months of operation as closed beta, the site attracted more than 1 million registered users. But after being online for almost a year, Baidu announced on the site this week that it would be suspending all services later this month.

Baidu declined to give specific reasons for the site's closing. In a e-mailed statement, the company said Baidu Talk had allowed the company to gather more valuable experience in developing its social networking services strategy. The company added that features on Baidu Talk will be incorporated in other Baidu products.

Baidu has already dominated China's search engine market, beating out Google to grab 80 percent of all Internet search queries, according to CNZZ.com, an analytical Internet research site.

But China's microblogging market is dominated by two other major domestic Internet firms. Internet portal operator Sina has its own service, called Weibo, which has 140 million registered users. Meanwhile, a Twitter-like service from online game and instant messenger operator Tencent has 160 million registered users.

U.S. social networking sites like Facebook, Twitter and Google Plus have all been blocked by Chinese Internet censors. The country's authorities routinely block sites and delete content deemed politically sensitive or anti-government.

Baidu Talk failed to gain traction in China's market partly due to timing, and launched months after its rivals had already begun to gain a sizeable following, said Mark Natkin, managing director for Beijing-based Marbridge Consulting. But the Chinese search giant has also struggled to create successful products outside its core business of search.

One example, was Baidu Youa, the company's effort to combine its search engine with e-commerce. But the site failed to achieve a major share in the country's Internet market. In April, Baidu effectively migrated the e-commerce portion of the site to other platforms and made Youa a lifestyle portal.

"Within the corporate culture of Baidu, these products could be considered not as important and are lower in the pecking order," he said. "They're not able to get as much access to key decision makers and end up being more limited."

Baidu, however, will see better success either through partnering or launching separate companies to handle products outside of search, Natkin said. The company did so with Qiyi.com, a Chinese online video site that launched in April 2010, which Baidu owns a stake in.

"I think social networking is an area that's crucial for Baidu to develop more fully," Natkin said. "But it would likely do best to follow the same model it has employed for online video and look for a company outside of Baidu that has a proven track record and can partner with or acquire."

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