A Conference Note From Phil Leggiere

• BIDU's new PC and mobile integrated bidding system got good feedback from agencies and its In-App Search was seen as a potential breakthrough in mobile Web search
• Alibaba and SINA's platform partnership viewed as boosting e-commerce and advertising synergies; SINA extending strength on advertising growth
• QIHU launch of People Ran reviewing system viewed skeptically by some attendees, who questioned data's authenticity

Baidu's Mobile Search Could Experience Explosive Growth
Several presenters at this year's Internet conference said three mobile apps -- Tencent Holdings Ltd.'s (700 HK) WeChat, Sina Corp's Weibo and Baidu Inc.'s Map -- are accounting for around 60% of download and active daily visit traffic, while the vast majority of other applications are having difficulty gaining traction in activating users.

Baidu's In-App Search, which enables users to find content (including video) in other apps and show it directly in Baidu's mobile search engine, also was featured prominently. In-App Search was said to be very different from Baidu PC search, which drives traffic to Baidu's engine and only allows users to find third-party links. Sources described Baidu's mobile search as more open than PC search as they share more traffic to other applications.

A media buyer director from a Shanghai online advertising agency said Baidu's PC and mobile integrated search auction system, which was introduced in July, provided good user experience. He said, "The new system has a similar interface to the PC bidding system. We can choose PC or mobile search easily by checking the box before it. We usually set mobile bidding price at 75% of the PC price for the same keyword, and from our data monitor system we can see that mobile search traffic accounts around 22% of entire search, which is much better than before."

Source provided an example of search series on Baidu's mobile engine: Users can watch the video directly on Baidu without opening Letv App. Baidu tells user "source: Letv" and then shares traffic with Letv directly.

Sina Extends Strength on Taobao and Weibo Integration
Sources said Alibaba.com Ltd.'s e-commerce platform Taobao.com and Sina's Weibo have upgraded integration, which provides three benefits. First, user registration and login cost is reduced by the dual-platform account interoperability. Store managers and buyers can switch between Weibo and Taobao freely without a dual login.

Second, the ads on Weibo presented to the user are no longer boring, short links but are much richer, with a variety of information aggregation, providing buyers intuitive references -- including prices and reviews. Users can click a "to buy" button directly to make a purchase. Third, Weibo's Taobao platform enables users to release new products or share a purchase experience on Taobao to their Weibo followers directly. "Social e-commerce is a trend. Sina Weibo and Taobao's cooperation is benefiting both platforms by helping them gain more traffic," a source said. "Some people say that Sina Weibo gets used less and less; yes, forward traffic did decline. But we are not uninstalling Sina Weibo as this is the only unique Chinese media. Everyone will keep Sina Weibo as the key information media."

Skepticism About Qihoo's "People Rank"
Qihoo 360 Technology Co. Ltd. released a search reviewing system called People Rank, allowing user reviews of website links to influence the ranking order of search results. Qihoo is also providing reference data, including a website identity label, qualifications and service level. However, sources are skeptical of the review scores, as advertisers can vote for themselves or hire a third party to vote for them. "A search engine should be a neutral platform. This reviewing system is too artificial and will raise vicious competition. Baidu is suing Qihoo for maliciously marking Baidu's search page and hijacking traffic," one source said.

Event: China Internet Conference 2013, the 12th annual Internet summit from the industries of mobile Internet, Internet safety, Internet financials, cloud computing, online advertising, RTB, e-commerce, social networks and online videos.
When: Aug. 12-15, 2013
Where: Beijing's International Convention Center
Who Attended: More than 260 entrepreneurs and more than 12,000 audience members in China's digital marketing areas
Why it Matters: China's online advertising is on a rapid growth trend, and Baidu, Tencent and Alibaba are aggressively continuing their M&A in the Internet world to roll out innovative solutions and combine multiscreen digital media. OTR Global is gaining greater visibility into the movement of the search, social media and new e-commerce model.