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Baidu CEO touts growth of China's search engine

Robin Li tells Stanford students to embrace tough decisions when running a start-up company in a discussion that centered on entrepreneurship in the tough Chinese market.

PALO ALTO, Calif.--Baidu CEO Robin Li, on a rare visit to Silicon Valley Wednesday, explained the rise of his company's search engine in China before a group of students more interested in entrepreneurial tips than censorship.

Baidu CEO Robin Li advised Stanford students to make sure they understand the Chinese market if they want to do business there. Tom Krazit/CNET

Li ended a trip to the U.S. Wednesday at Stanford University, speaking to a crowd of several hundred students about the lessons he learned shepherding Baidu through the first dot-com bust and growing it into the Google of China. Baidu has 76 percent of the Chinese search market, he said, which consists of 338 million Internet users: larger than the entire population of the U.S.

The key to Baidu's success amid a terrible recession for Internet companies in late 2000 and 2001 was careful use of the initial venture capital investment in his company and making a tough decision to overhaul Baidu's business model from providing back-end search technology to portals to designing its own front-end user interface, Li said. He also outlined his vision for future search called "box computing," which seemed to involve a Chrome OS-style user interface that would run independently of the operating system as the start page for a new generation of computers and use semantic technology to deliver a search result more in tune with the searcher's intention.

Li was given a very warm reception from the students, who massed around him after his talk to have their pictures taken with one of China's most prominent CEOs. Only one student hinted at thecensorship dance required to operate a search engine in China, asking Li how his company manages the tricky relationships with regulators.

The Internet is new everywhere, Li said, but it's especially new to China. That means that regulations haven't always anticipated the issues that can arise on the Internet and lag the pace at which the Internet evolves, he said. But he otherwise avoided any mention of Baidu's role in preventing Web pages that run afoul of the Chinese government from appearing in Baidu's search results: a 2008 study by the University of Toronto's Citizen Lab found that Baidu censors far more search results than competitors.

Most of the questions came from students who wanted to know how American companies can break into the fast-growing Chinese market. Li said there's no substitute for having a local presence in China, and not to underestimate the growth of the Internet in China. Baidu's search index triples every year, he said, and competitors often can't keep pace with that growth, meaning they do not offer all the pages that Chinese Web surfers seek.

"If you can't find it on Baidu, you can't find it anywhere else," Li said. That, of course, can be interpreted in a number of different ways.