Agent talks at impasse as Baidu moves to end Tieba commercialization as part of its search overhaul

By Xie Jun Source:Global Times Published: 2016/8/3 22:43:39

Dozens of agents for Baidu Inc's Tieba forum have reached an impasse in talks with the Internet giant on Wednesday, which said in early July it will stop providing commercial services to domestic enterprises as part of an overhaul of its search function.

Tieba is a system of forums that are usually open and free for use. But in recent years, Baidu started to sell those forums, mostly via agents, to domestic companies, which can use those forums, such as by deleting negative postings, to enhance their reputation and advertise for themselves.

Baidu has proposed compensation plans, but many agents will still lose a lot of money because of the change, industry insiders told the Global Times on Wednesday. 

More than 70 agents from all over China gathered in Beijing on Monday to discuss follow-up arrangement after ­Baidu terminated Tieba contracts with them.

But talks broke down on Tuesday over issues such as compensation, financial news portal reported on Wednesday.

According to the report, agents can continue to perform under the terms of their contracts until the end of 2016. Or, they can terminate their contracts early and Baidu will return the fees for the second half of the year. Baidu usually signs contracts with agents on a yearly basis, the report said.

"Usually an enterprise pays about 60,000 yuan ($9,048) annually to the agent, and the agent applies to Baidu to buy Tieba on its behalf," said an employee of a Shanghai-based Tieba agent who declined to be identified.

He wouldn't disclose how much the agent usually pays Baidu.

Also, the employee told the Global Times on Wednesday that agents usually invest a lot of money in the business.

"The scale of such companies ranges from a dozen people to hundreds," he noted. "Hiring offices and registering also cost money. But making profits out of the business is not so easy; it takes time."

The report from also cited some agent representatives as saying on Wednesday that they collected the investment capital by selling their houses or cars.

The Shanghai-based employee said that his company was forced to terminate its business in July, but it was not one of the companies that negotiated with Baidu in Beijing in recent days, as it wants to avoid such disputes.

The employee also said that the business of selling Tieba is "not good" as there are not many domestic enterprises that have such a need.

Baidu decided to stop providing such services as it wants to "attach more importance to the interests of Tieba users," according to a statement Baidu sent to the Global Times on Wednesday.

Baidu's sale of certain Tieba has been a controversial practice, according to domestic media.

Liu Dingding, an independent Internet industry analyst, told the Global Times on Wednesday that Baidu is launching reforms and stopping the sale of Tieba will help it provide better services.

He also said Baidu is not dependent upon Tieba for revenues, so dropping the service won't have much impact on the business.

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