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I Admit It: Qihoo Is a Real Threat to Baidu

Kevin Chen
June 21, 2013

I don't like Qihoo 360 (NYSE: QIHU), but I do realize when a company is here to stay.

If you've followed Qihoo over the past year, you may have heard how it seems to be more of a marketing company with inferior products rather than a serious tech competitor. Well, once you read its most recent earnings report, you may change your mind like I did. The fact is, Qihoo seems to be making profitable strides in the search market.

Before you invest in China's tech scene, here's how to think about Qihoo's long-term prospects.

Why I did not and do not like Qihoo
I've written two articles about Qihoo's poor copy-cat products and six  "anti-competitive" marketing tactics before. To get you up to speed, let me recap a few key points.

(1) Qihoo's flagship anti-virus software essentially rates your computer as less "safe" if you haven't downloaded the company's 360 Browser. (2) In addition, the company prevents you from installing competitors' software by noting (fake) incompatibility.

While you may think this isn't a big deal, the Chinese government does. In February, it issued a public statement reprimanding Qihoo and warning it to stop. As Beijing doesn't seem to have issued any other stateme