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John Welfare: CCTV'S Attack On Baidu Should Arouse Investors' Vigilance.

2011/8/19 14:00:00 40

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John? Welfare CCTV Baidu Attacks Against Vigilance

Chops

Baidu

The broadsword has been sheathed.

In a series of reports, CCTV criticized Baidu, accusing its poor commercial practices and failing to supervise the "libel" remarks in the forum.

These allegations may be just a product of industry jealousy, policy conspiracy, or investigative reporting from a consumer perspective.

But they remind investors that we should be alert to the inherent risks of China's Internet Blue-chip company.

Baidu is expanding rapidly, expanding since its US competitor Google withdrew from regulatory issues.

Revenue increased by 78% over the previous quarter.

There are some signs that Baidu employees are really a serious problem to help users sell counterfeit tickets and counterfeit drugs on their pages, but it is not surprising for a company that is growing so fast.

Baidu has launched an action to clean up fake sellers.

The biggest problem is CCTV.

exposure

Is it out of executive order?

Considering the relationship between China's Internet and free speech, it is possible - but not necessarily.

If there is an ulterior motive behind these reports, it may be more relevant to CCTV's ambition to nurture its online search product.

Even so, if the customer's anger is accumulating, the risk of government involvement in regulation or even worse means exists.

There are many voices of discontent on the Internet, especially after the July 23rd crash.

At the same time, the government is also faced with the problem of thin websites with active supervision.

Not only that, Baidu has a fatal problem.

weakness

。

Like all overseas listed China Internet Corporation, Baidu's listing is an unusual structure that bypasses foreign ownership restrictions through agreement control, that is, an unusual structure that only gives shareholders contractual rights rather than direct ownership.

This structure has not yet been tested, but the government may still declare it illegal. The company also acknowledged this in its submitted documents.

Baidu's stock price didn't show much concern.

So far this year, its share price has risen by more than 40 percentage points, despite the 9% decline in CCTV's share price.

But CCTV attacks should remind Baidu investors that their returns are accompanied by many political uncertainties.