In an interview with Bloomberg on Friday, CEO Robin Li detailed the site's home page makeover.
Instead of simply steering visitors to lucrative paid search results for lead-hungry advertisers, Baidu's new home page features a section promoting apps by third-party developers and links to other websites.
Baidu clearly isn't broken in its current form. It now fulfills more than three-quarters of the country's search queries. However, pushing ad clicks hasn't worked wonders for its reputation. Government-run China Central Television ran another unflattering expose on the dot-com speedster last month.
Baidu has been able to bounce back, but it apparently feels that the time is right to become a broader portal.
These new initiatives won't pay off right away. Baidu made a strong push into video last year, even if niche leaders Youku.com
Baidu Yi -- a mobile app platform along the lines of Apple's
Baidu is currently trading at 32 times next year's earnings. That may not seem cheap, but it's a bargain historically. The dot-com darling is also growing a lot faster than that.
Baidu's growth has been impressive. Revenue and earnings climbed 78% and 95%, respectively, in its latest quarter. Will the new changes slow Baidu's torrid pace, or will the new initiatives be incremental? Investors may wonder why Baidu needs more out of life than the juicy high-margin fruit of paid search, but you also have to admire a company using its successful brand as a springboard to reach new places.
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Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.