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Baidu ad revenues slump in the wake of the recent medical practices scandal

By Andrew Redfern @ 28th November 2008 5:53 pm

Baidu has quickly dropped the ads of four clients after finding out their medical licenses were fake. This has resulted in a huge loss of revenue for the company but is seen as vital in maintaining it’s reputation.

According to a report in The Guardian Baidu’s ad revenue has dropped by as much as 10% as a result.

The company has also sacked some of the staff who were implicated in the ensuring these fake medical practices get top ranking in Baidu.

Robin Li, Baidu’s chief executive, told the Chinese state news agency Xinhua today that the firm had sacked staff and more could follow. He stated :

“Baidu employees who are found to have been involved in the scandal will be penalised, We have already fired people who helped fabricate documents for unlicensed suppliers.

“We have removed the key words of all four clients mentioned in the report and have begun to double check the licences of all other hospitals and pharmacies on our client list.”

Earlier this month a Chinese television station ran a report revealing that the Baidu search results had steered searchers suffering from illness to expensive bogus hospitals.

One interviewee told he’s spent alonst a thousand pound at on of these clinics but was only cured of his abdominal pain when he subsequently visitied a public hospital.

The unlicensed clinic was paying Baidu around £1.60 per click to get top rankings whilst hospitals who were not paying were purposefully ommitted from the search results.

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