Listing scandal hits Chinese internet giant

China’s internet search giant Baidu has promised to overhaul its operations after state media accused it of allowing unlicensed medical services to buy high search rankings.

The search engine dominates the market in the world’s largest internet population with about 60% of users—well ahead of Google, which leads the field internationally. But the case has caused Baidu’s stock to plummet and highlighted users’ complaints about the way the Nasdaq-listed firm allows companies to buy their way up the list of search results.

Robin Li, Baidu’s chief executive officer, told the state news agency Xinhua on Friday that the firm had sacked staff over the case and could fire more. “We have already fired people who helped fabricate documents for unlicensed suppliers,” he said.

“We have removed the keywords of all four clients mentioned in the report and have begun to double-check the licences of all other hospitals and pharmacies on our client list,” he added.

Baidu said in a statement that it had removed paid search listings for companies that had not filed details of their licences pending checks.
Those customers together accounted for around 10 to 15% of its total revenues, it added.

State-run China Central Television reported this month that the search rankings had steered people to unlicensed and expensive hospitals or medicines that failed to cure them.

One patient told the programme that he had wasted more than 10 000 yuan ($1 457) at a clinic that he chose because it topped the Baidu results. The unlicensed clinic paid Baidu nearly 17 yuan per click (about $2,50) for a prominent ranking, according to the report.

The programme also alleged that some companies that did not pay were omitted from results. But in a statement, the firm insisted: “Baidu has never excluded websites of any customers because they did not pay for keywords, and Baidu does not tolerate such practices.” -

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