Chinese social media giant ByteDance injected millions of dollars into Baike.com, an online encyclopedia services provider to enrich its sea of searchable content on its recently released Toutiao search engine.
ByteDance has opted for Baike.com, formerly Hudong, for its encyclopedia services instead of Baidu Baike, Baidu’s encyclopedia platform equivalent to Wikipedia. By investing in another service, ByteDance is marching straight into Baidu’s territory of providing internet search services.
According to China’s national credit information publicity system, the registered capital of Baike jumped from 30.5 million yuan ($4.3 million) to 39.2 million yuan ($5.6 million) on July 5 thanks to ByteDance’s investment. That makes ByteDance the largest shareholder of the company with 22.2% of the total shares, higher than the Baike.com founder and Chairman, Pan Haidong.
Although ByteDance is now the largest shareholder of Baike.com, it is still unclear whether or not it has full control over the operations of the company.
From the recruitment notice released on July 31 to the official launch of the search engine on August 10, ByteDance has blown the battle horn announcing its direct competition into Baidu’s home base of internet search in China.
Threatened by the disposition, Baidu is also actively seeking out various ways to achieve breakthroughs to mitigate the market share loss by ByteDance’s entrance into this space.
On August 14, Baidu reported a DAU exceeding 200 million, which means the platform is one of the most used search engines in China still. Benefiting from advertising itself in the Spring Festival Gala this year, Baidu saw a rise in DAU throughout the past six months by up to 40 million.
The Chinese internet company has also recently wrapped up a round of investment into Chinese Quora-like platform, Zhihu, to strengthen its defense against ByteDance’s aggression.
ByteDance, in contrast, is rocking a combined overall MAU exceeding 1 billion across all of its platforms including Toutiao, Face U, Huoshan and Douyin, the Chinese version of TikTok which alone has a DAU of 200 million.