Baidu Inc (ADR) (NASDAQ:BIDU) the producer of China’s biggest search engine has strategically invested in content recommendation startup Taboola. The firms refused to divulge the figure of the deal but hinted that it was in the multimillions. Baidu also announced a partnership with Taboola Inc to bring the latter’s content recommendation platform to China.
Taboola provides the links in the “Around The Web” and “Recommended For you” sections that are placed at the bottom of articles on websites including The Atlantic and Business Insider among others.
What are apparent are the potential synergies between the two companies. Baidu can leverage Taboola’s technology to grow its knowledge graph. The deal offers a channel for Taboola to enter the growing Chinese market.
Baidu has a 75% share of China’s desktop and mobile search market put together. Taboola delivers over 200 billion monthly content recommendations to 550 million people.
New York Based Taboola along with Outbrain Inc are the two dominant companies in the rising Web advertising segment of content recommendation. New entrants include Yahoo Inc., AOL Inc. and WPP PLC.
Taboola has a substantial presence in the American market. Last year the company allied with Yahoo Japan to enter the Japanese market. Baidu Inc (ADR) (NASDAQ:BIDU) holds the distinction of being China’s biggest search provider. Also, it figures in the list of the five biggest search providers in the world.
Taboola has invested years developing a mathematical predictive engine that generates content suggestion as per the person reading the article.
Baidu has earlier invested in US-based companies such as Uber and IndoorAtlas. The goal is to enable Baidu users get content whose existence they were unaware of, leveraging Taboola’s predictive targeting technology. Tabool employs 270 personnel worldwide and grosses $300 million in revenue. The company is valued at more than $1 billion and is the world’s third largest syndicated advertising platform.
