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Baidu Joins Digital Home Assistants With Acquisition Of Raven Tech

By Victor Thomson , Feb 18, 2017 12:37 AM EST
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Baidu acquires AI voice assistant company Raven Tech to compete with Amazon Echo and Google Home. (Photo : CGTN / YouTube)

Baidu, one of China's top search engines, has acquired a Y Combinator-backed startup called Raven Tech. This move is part of the company's strategy to compete with Amazon Echo and Google.

Search Engine Baidu Acquires AI Voice-Assisted

According to Media Post, Chinese search engine company Baidu aims to compete with Google and Amazon in the field of digital assistants. The company acquired AI startup Raven Tech for an undisclosed amount. Raven Tech is an artificial intelligence startup that created an AI-based voice assistant called Flow.

AI startup Raven Tech has raised a total equity funding in four rounds of around $18.12 million from six investors. The acquisition deal gives Baidu rights over Raven Tech's technology products and intellectual property. Baidu's smart-home team will be joined by Raven Tech's 60 employees.

The startup founded in May 2014 is based on Beijing and Silicon Valley. Raven Tech became one of the graduates from Microsoft Ventures Accelerator program in Mainland China that is enrolled in the Y Combinator program. The company also has been working on Raven H-1, a voice-assisted hardware device designed for the home that is not yet released to consumers. Baidu executives will likely try to find ways to integrate Raven Tech's products into its own digital assistant service called Duer.

Baidu's Efforts To Expand Beyond Search

Baidu already has a firm foothold in the strategy for 2017, as the year is expected to become one of conversational computing and personalization. After about a year and a half at Google, company's chief scientist Andrew Ng has been hired to lead the Silicon Valley Lab in 2014. He is the founder and leader of the deep-learning Google Brain project.

In January 2017, Baidu opened an augmented reality lab and hired Qi Lu, a former Microsoft executive and leading artificial intelligence expert. The opening of the new lab is following the launch in September 2016 of a venture capital fund dedicated to artificial intelligence and augmented reality. Lu, who became the Baidu group president and COO is widely considered a leading expert in the emerging field of artificial intelligence.

The company faced criticism in China for the death of a student suffering of cancer who tried an experimental drug discovered through a paid-search campaign. Now it appears that Baidu is looking for a way to generate an alternative income in order to augment its falling search revenue. As a result of new government rules on paid-search ads, Baidu's revenue has been reporting its first decline in quarterly revenue.

Baidu moved into the second spot during the fourth quarter of 2016. The company covers 23.3 percent ad revenue share in China. The top position is occupied now by Alibaba, with 26.5 percent ad market share.

According to eMarketer, despite its strong position in China, Baidu needs to expand to other markets beyond search. With Tencent's WeChat in firm control of messaging and Alibaba dominating the ecommerce field, Baidu's ongoing investments in AR and AI are a clear step of the company in its plan to re-establish itself in China. An eventual expansion into other countries is also considered by the company.

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