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Baidu investing $470 million to create Chinese SEO industry (BIDU)

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China's top search engine company Baidu ( BIDU , quote ) will invest 3 billion yuan ($470 million) through the end of 2015, ostensibly to help 2 million small- and medium-sized businesses in China expand.

However, the real payoff here is that Baidu will train 100,000 search marketing professionals, help small- and medium-sized enterprises develop their online service platforms, provide free marketing for less developed regions in China and help government departments in their research on business.

All of this together reflects the belief of Baidu's management that this commitment will likely boost the use of its paid online advertising services by the smaller enterprises that have yet to embrace the Web -- and are being increasingly subsidized by Beijing.

China does have more than 485 million Internet users, but overall penetration is only around 36% and user sophistication outside the big cities is still low. As a result, the potential for growth here is still enormous.

In the third quarter of 2011, China's online search market grew 77.8% to 5.51 billion yuan. Baidu had a 77.7% share of that market according to Beijing-based technology consultancy iResearch.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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