I wondered what the big deal with the search engine baidu.com (BIDU) was when I heard the stock dramatically shot up in value upon going public. Turns out one of their hot features was an mp3 search engine which allegedly made it easier to listen to and download illegal copies of songs, via thestandard.com.hk:

Universal, EMI, Warner, Sony BMG and their local subsidiaries, Cinepoly, Go East and Gold Label, are suing the search company in a Beijing court for infringing the copyright of hundreds of songs. They allege that the search service makes it easy for users to listen to and download illegal copies of their songs, said a source close to the music companies.

Baidu’s stock has gone from a high of $153.98 to $81.24 as of this writing.

Mike from Techdirt was also cynical on the IPO from the beginning: Why Baidu’s Investors Should Have Done Some Research:

So, the company now has two choices: fight the lawsuit (which means spending lots of money) or get rid of the downloads and take away their competitive advantage. This was pretty predictable for anyone who actually took a couple seconds to look it up before the company went public. No wonder Baidu’s VCs are so pissed off they’re still stuck in the lockup period.

Wonder what the stock price will be like when the lockout is over?

Did this post make you go hmm?

 Loading ...