Baidu said to expand reach to Brazil

Baidu Inc, the biggest search engine in China, is expanding its reach to Brazil by setting up an office in the Latin American country, bringing it a bit closer to rival Google Inc's home market.

The Chinese company is preparing to set up a branch in Sao Paulo, according to an item posted on the website of the Ministry of Commerce on Wednesday, which cited Brazilian media.

Baidu aims to "compete with Google" with the new branch, a manager in charge of Baidu's business in the Latin American region was quoted as saying.

It will launch a Wikipedia-like product first, but it doesn't have a timeline for its search service, the manager said.

The Brazil branch will employ 20 people in the first six months and perhaps more eventually.

Baidu Vice-President Zhu Guang declined to comment on the report on the company's Brazil office.

"The Brazilian market doesn't resist foreign competitors, as most of the search services in the country are provided by foreign companies," said Hong Bo, an IT critic who follows the search sector.

"But while competing with its international counterparts, Baidu has no obvious advantage," said Hong.

He cited Baidu's performance in Japan, saying that the company still had much to learn about going abroad.

The Chinese search engine began to expand overseas in 2006, making its biggest move - entering the Japanese market - in 2007.

However, it remains a tiny player in Japan, where its search service ranks about 800th among all websites measured by traffic, while Google's search service has the second-largest volume of traffic, according to traffic tracker Alexa.com.

Google has an overwhelming share in Japan's search market.

Despite Baidu's big ambitions for international expansion, it lost 680 million yuan ($108 million) from operations outside China from 2008 to 2010, according to figures it provided to the US Securities and Exchange Commission last year. Baidu is listed in the US.

Zhu said last year that Baidu would continue its internationalization despite losses overseas.

The company has been low-key in talking about its global expansion plans, but it has continued to start services overseas.

Last year, Baidu launched an Arabic version of a question-and-answer service called Baidu Knows, and a local-language version of its web directory Hao123 in Thailand.

Last month, the company broke ground on its South China headquarters in Shenzhen, which will function as its headquarters for international expansion.

Baidu had 78.3 percent of China's search market last quarter, followed by Google's 16.7 percent, according to the domestic research company Analysys International.