Turmoil at Top Chinese Tech Firm Baidu as Senior Execs Leave

Baidu co-founder and CEO Robin Li speaks on stage at the annual Baidu World Technology Conference in Beijing on November 1, 2018. (FRED DUFOUR/AFP/Getty Images)

Robin Li Yanhong, founder and CEO of China’s most popular search engine Baidu, recently left his position as executive director of Baidu Cloud Computing Technology, just as nine other Baidu senior executives left the company, drawing investor concerns about the future of the firm.

Baidu stated on Oct. 8 that the changes were part of the company’s normal operations. 

But at the Nasdaq exchange, Baidu’s stock price fell and reached $98.62 per share at noon on Oct. 9—its lowest since July 2013.

Resignations and Retirements

Li resigned from his role at Baidu’s cloud computing business on Sept. 9. On the same day, Liu Hui resigned from his position as the firm’s legal representative and general manager.

Liu had announced in April that he would retire soon. One month later, Liu resigned from his position as Baidu senior vice president of human resources. At the time, he had said that he would keep his position in the cloud computing business. The latest change proves otherwise.

AI scientist Zhang Yaqin announced his retirement back in March, from his role as president of Baidu. Zhang had joined Baidu in 2014.

Meanwhile, Wang Lu, Baidu senior vice president of public relations and marketing, resigned and left Baidu on Oct.1, according to Late Post, a publication under Chinese business magazine Caijing.

In recent months, six other senior executives of Baidu have also resigned.

Zheng Zibin, Baidu vice president of innovation, resigned in June after working at the company for nine years.

Xiang Hailong, Baidu senior vice president and general manager of the search engine business, resigned on May 17, where he had worked for 14 years.

Four other Baidu senior managers also resigned this year: Wu Haifeng, vice president of the search engine business; Gu Guodong, vice president of the search engine’s sales department; Sun Wenyu, executive director of the search engine business; and Zhao Cheng, vice president of government relations. 

Aside from Gu, all had worked at Baidu for more than a decade.

Baidu’s New Plan

On Sept. 29, Baidu announced that it would no longer support its self- developed browser, which was available for PC computers. The company said it stopped all maintenance and operations for the browser in May, but did not provide a reason for why.

On Sept. 26, Ctrip, a Chinese travel services provider, announced that Baidu would sell one-third of its Ctrip stocks, valued at over $1 billion. 

Many Chinese media analyzed that this move meant that Baidu would shift its focus to cloud computing.

Back in July 2016, Baidu executive Yi Shimin had announced that the company would develop an “ABC” plan: AI + Big Data + Cloud Computing.

According to Nevada-based network and telecom business market intelligence and analytics supplier Synergy Research Group, Baidu is the fourth largest cloud service supplier in China’s market.

Criticisms

Meanwhile, Chinese netizens have long complained that Baidu’s search results are not objective or accurate. However, foreign search engine tools such as Google and Bing are not allowed in the Chinese market. 

Baidu has been mired in several scandals over its problematic search results. 

In April 2016, Wei Zexi, a 21-year-old college student died at a Chinese military hospital after receiving an unproven medical treatment that he learned about through Baidu. Wei’s death prompted public furor over Baidu’s ethical standards, when Chinese media and netizens revealed that Baidu was generating advertising revenue from a Chinese medical syndicate known as “Putian Network,” which has a history of marketing fake medicine and treatments—including the one that caused Wei’s death.

In July 2017, 15 months after Wei’s death, a Shenzhen pediatrician searched for “Shenzhen Children’s Hospital” on Baidu. The map showed the address of “Yuandong Women & Children Hospital” instead. The Yuandong hospital belongs to the Putian Network.

State-run media Xiandai Kuaibao reported in June that it received public complaints that Baidu was promoting gambling websites in its search results.

When the newspaper’s reporters searched for “Texas poker,” the results included some overseas gambling websites, gambling videos, and recruitment posts for jobs at overseas gambling casinos located in the Philippines, Cambodia, and other Southeast Asian countries.

Also, Baidu’s developed apps have been criticized for collecting data on users without their knowledge, such as its map, internet browser, and search apps.

The U.S. Assistant Secretary of State for International Security and Non-Proliferation, Dr. Christopher Ashley Ford, also criticized Baidu, for being among a number of private Chinese firms that develop “technology-facilitated surveillance and social control for Chinese government.”

Baidu, Huawei, Tencent, ZTE, and Alibaba follow Beijing’s requests “in the form of access to foreign technologies, access to foreign networks, useful information about foreign commercial counterparties, insight into patterns of foreign commerce, or specific information about the profiles, activity, or locations of foreign users of Chinese-hosted or -facilitated social media, computer or smartphone applications, or telecommunications,” he said at the Multilateral Action on Sensitive Technologies Conference in Washington D.C. on Sept. 11.