Why Baidu is Behind in China’s Tech Race
Updated: May 27, 2019
China’s three largest internet businesses: Baidu (China’s leading search engine), Alibaba (the ecommerce giant) and Tencent (the world’s largest gaming company), are part of the global race to develop artificial intelligence (AI), autonomous driving and virtual reality (VR) technologies. However, Baidu is falling behind the ever increasing pace that both Alibaba and Tencent are setting.
Alibaba now boasts 493 million users accessing its marketplaces every month, and that’s just in China. Last November, for their annual Single’s Day shopping festival, they unveiled Buy+, a virtual shopping experience where products can be modelled in front of a customer using VR, and purchased through Alipay with a simple nod of the head. They also incorporated augmented reality by creating a Pokemon Go style game that allowed consumers to find rewards and discounts around cities during the and encouraged smartphone purchases.
Alibaba has also developed an AI software package, “Ecommerce Brain”, to make more informed predictions about what customer interests through analysis of content consumption and purchasing preference.
Similarly, they have developed a system called Ali Xiaomi (Ali Assistant), which deals with questions or complaints but can also help users find products with just a description or photo.
Alibaba is committed to using both VR and AI to revolutionise industries, starting with ecommerce where they undoubtedly have an eye on challenging US giants Amazon.
As the world’s largest video gaming company, owners of China’s most popular games (not to mention social media platform WeChat), Tencent’s resources are virtually unlimited. Despite being the most recent to start seriously developing these new technologies, they have now opened two AI research labs in Shenzhen and, most recently, Seattle, USA. They have recruited 50 of the leading AI scientists, researchers and experts, including Zhang Tong who was poached from Baidu’s Big Data Lab setup.
Tencent aims to implement technology and develop the company’s existing products in social media, gaming, content and online tools. For example, an AI virtual assistant in WeChat with the ability to rival other assistants such as Apple’s Siri or Google Assistant would be a big step towards creating the operating system replacing app many think Tencent are aiming for.
With VR widely picked as the future of the gaming industry, Tencent has also focussed on developing it further to maintain their position as one of the global leaders in gaming technology. Their $1.8 billion investment into Tesla also showed a challenge to Baidu and how they are betting their future on machine learning and AI.
Losing Key Personnel
A major factor in the speed at which Baidu has fallen back was the sudden resignation of four of their leading team members. The ‘trio’: Yu Kai, Andrew Ng and Wang Jing, who were the driving force behind their early successes in AI development as the first Chinese company to enter the area, all moved on. As did their Big Data Lab lead, Zhang Tong (as mentioned earlier).
Yu Kai, founder of Baidu’s Institute of Deep Learning was the first of the ‘trio’ to leave when he resigned in 2015 to start up his own AI company, Horizon Robotics. He also took some top members of his team with him, which deepened the impact.
The largest loss was Andrew Ng, who resigned as Chief Scientist of AI development, despite Baidu’s $2.9 billion investment into research and development comparing very favourably with the figures from both Tencent and Alibaba. Furthermore, Ng had a team of around 1,300 people, again far more than the resources at either of the other two companies.
In April 2017, Senior Vice-President and head of autonomous driving unit, Wang Jing, left to set up his own programme. During his tenure, there were major breakthroughs, with their autonomous car completing its first road tests in 2015 and later in September 2016, following which, Baidu were granted a permit allowing them to test autonomous driving technologies in the US, only the 15th in the world.
How About The Future?
Whilst Baidu have clearly suffered setbacks of late, a company of their size and resources has the ability to bounce back. Indeed, they are already showing signs of doing so through their maintained (but narrow) lead in Chinese autonomous driving development.
The unpredictable nature of new technology, and how well it will be adopted by the wider population, means that, given the amount of resources Alibaba and Tencent are investing in VR and AR, a flop in either could well find a different BAT company in a similar position to Baidu’s. Therefore, even though a gap has opened recently, it is unlikely that any of the the BAT trio is going to fall much further behind soon.
Mailman is a digital sports marketing consultancy and technology company. We help global rights holders, athletes, and leagues to build a successful business in China.