Baidu’s Acquisition of 91 Wireless Triggers Change of Mobile Internet

At 9:00 a.m. on July 16th, Net Dragon Websoft Inc. announced in HKEx that, Baidu and Net Dragon Websoft Inc. reached an agreement that, Baidu acquired all stocks of 91 Wireless with 1.9 billion dollars.

As a subsidiary of Net Dragon Websoft Inc., 91 Wireless owns the star products like 91 Mobile Assistant, Android Market, 91 Desktop, 91 Reader and other apps. It’s undoubtedly a big buy that Baidu acquires 91 Wireless with 1.9 billion dollars.

Previously, rumors of Baidu’s acquisitions on mobile app frequently arose, among which the most striking was the entanglement between Baidu and UC. However, instead of Baidu, Alibaba became the largest shareholder of UC in the end. Baidu’s acquisition of 91 Wireless, labeled as the biggest acquisition in China internet history, causes the attention of whole industry and has great significance to each other.

The position of mobile app store shouldn’t be ignored.

According to the mUserTracker, a product launched by iResearch that measures users’ behaviors on mobile smart devices, app store ranks fifth in all the mobile internet app categories, and the top four are IM, browser, system tool and online music. Among the top 10 categories, IM, browser and app store are entry-level apps, while system tool app ranks higher for its wide coverage.

It’s notable that, users of app store surpass that of security apps, indicating mobile app store’s important role in mobile device. With rapid growth of app store users in recent years, mobile app store users become the fundamental source for newly increased mobile app users. Hence, 91 Wireless, which develops early and gets a good reputation, may have a significant impact on users.

Compared with other two internet giants, Baidu is lagging behind in mobile internet business. With superior advantages in mobile internet, Tencent Wechat has vigorously sought the way to monetization after absorbing hundreds of millions of users. While Alibaba not only possesses Taobao, which holds monopoly place in mobile shopping, but invests in Sina Weibo and AutoNavi, and carries out all-round development strategy in social e-commerce and O2O.

Baidu’s strategy layouts in mobile device are LBS division and Mobile Cloud division. Firstly, the main products of LBS are online to offline apps like Baidu Maps. In fact, Map apps don’t get substantial achievement in the number of users and user viscosity. In addition, both Map apps and O2O apps face strong competitors. Secondly, Mobile Cloud possesses the products like mobile assistant and mobile browser, and it also provides developers with opening platform and development tools. Baidu Mobile Assistant, evolving from Baidu app center, doesn’t reach first-tier level in the number of users for its later start.

Baidu has obvious advantage in mobile search, especially mobile webpage search, thus in app-centered mobile internet, it lacks a killer app. Previously, the rumor that Baidu acquires UC was widely spread for UC had hundreds of millions of active users by month and was a significant app in mobile devices. However, compared with UC, the business of 91 Wireless are more helpful for Baidu to realize mobile internet strategy.

Firstly, UC’s major businesses include mobile browser and mobile game platform. On one hand, with mobile browser being the entrance to mobile internet, the default search engine of UC Browser is Baidu. On the other hand, Baidu don’t make much progress in mobile games. Hence, there is no big change for the relationship between UC and Baidu in a short time.

Secondly, app store is a key part in Baidu mobile layouts. Baidu can not only control web entrance through search engine, but control app entrance through mature app stores of 91 Wireless. According to public information, 91 Wireless earned 280 million Yuan in 2012 and ran ahead of domestic app stores.

91 Wireless, starting from 91 Mobile Assistant, is one of mobile app store which started earlier in China. Now, 91 Wireless takes the lead in mobile app stores for its early-starting advantages. And it started the procedure for going public at the end of last year.

Because traditional internet enterprises realized the important entrance position of mobile app store in mobile devices and flocked into the industry, 91 Wireless, as one of the few existing companies which started off by mobile internet business, is facing challenges from traditional internet enterprises. As the “rich second generation”, 360 Mobile Assistant experienced rapid growth in user base and development speed, depending on its desktop and mobile security clients, which imposed great pressure on 91 wireless. Therefore, it’s beneficial for 91 Wireless to be bought.

The acquisition not only brings benefits for Baidu and 91 Wireless, but has an impact on whole mobile internet market, because the main characters of the acquisition are traditional internet giant and independent mobile internet enterprise.


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