baidu robin liRobin Li, the chief executive of Chinese search engine Baidu, made a rare US appearance at the Web 2.0 Summit today, where he answered questions about his success — and about why competitor Google failed to make any real headway in China.

One of the common explanations is that China’s government backs Baidu and created obstacles for Google, but Li said that it’s a “misperception” to believe that “Baidu is the only game in town.” Instead, he said, Baidu won because it was willing to focus on and adapt to the Chinese market.

“First of all, we did try harder,” Li said. He noted that when he returned to China from Silicon Valley 10 years ago, he gave up all his stock options in his old companies, and Baidu “basically did nothing but Chinese search” for a decade. During its first five years, Baidu tripled the size of its search index every year, compared to other search engines that only increased by 30 or 50 percent.

There are obstacles to working in China, such as government censorship and slower internet load times, but companies need to be patient and adaptable, Li said. For example, he had heard complaints that the bureaucracy makes it more time-consuming to legally establish a company in China than in the United States. But while Li was waiting for the business license, Baidu rented office space and started writing code.

“The censorship issue, the bureaucracy, the slow internet connection, those are the things you really don’t have control of,” Li said.

And China’s startup environment is different from the situation in the US, he added. For one thing, Silicon Valley venture capitalists poured a lot of money into the region before Google’s arrival, creating a very competitive landscape. For another, many talented Chinese engineers in the US are willing to come back to China to work for a startup or to create their own.

“If you are not prepared to compete in this kind of market, you’re not going to be successful,” Li said.

So how dominant is Baidu? Li said there are 420 million people online in China and that 99 percent of them use Baidu.

As for future plans, Li said Baidu is looking at international growth and has already moved into Japan. Taking on Google in the more-established US market is not a priority, however.

“If we [come] up with ideas that are different and better, we will do it,” Li said. “Otherwise, we will wait.”

[photo by Dean Takahashi]