Chinese search engine Baidu Inc may face tighter regulations after facing a barrage of criticism from state media over its business practices at a time when it is cementing its dominance of the booming Internet market.
Analysts and various state media have suggested tougher rules could be imposed on the company in the wake of an investigative report by China Central Television (CCTV) which exposed how easy it was to register and promote a fake website on Baidu's search platform and conduct fraud.
Baidu has built its share of China's search market significantly since Google's high-profile exit last year citing hacking and censorship concerns.
"As Baidu becomes an essential part of people's Internet life, we believe the news report could trigger potential government investigations on the paid search business model and prospective regulations to protect customer rights," Wallace Cheung, analyst at Credit Suisse in Hong Kong, said in a research note published on Tuesday. Cheung has an "underperform" call on Baidu.
The half-hour CCTV report showed an under-cover reporter getting advice from an apparent employee of Baidu over how to get around regulations covering pharmaceutical advertising.
Baidu declined to comment on the report.
China's search market grew 62 percent in the second quarter to 4.3 billion yuan ($665.9 million), with Baidu capturing almost 76 percent of the market, data from Beijing-based technology firm Analysys International showed.
"As suggested by some experts, if Baidu cannot discipline itself, authorities should consider stepping in. Just as we do not live for food, Baidu should not just exist for money," said an article published on the People's Daily website, the mouthpiece of China's communist party.
Fire consumed part of the Chinese state broadcaster's landmark headquarters complex in Beijing yesterday evening as many in the capital celebrated the end of the lunar new year hol
Luo Jing was diagnosed with lymphoma in September of last year and was hospitalized to receive medical treatment. The newsman made his last appearance on air on August 31, 2008. L