Shares of China's largest web search company, Baidu, more than tripled in their U.S. market debut on Friday.
The Beijing company's initial public offering sparked huge interest internationally. Baidu.com was repeatedly described as a potential Chinese Google, serving the world's most populous country, where internet usage is surging.
But even analysts who expected a strong market debut were stunned Friday when Baidu shares more than trebled the $27 per American Depositary Share pricing of its IPO in the first U.S. listing of a Chinese search engine.
"It's just been amazing," said Sal Morreale, who tracks IPOs for Cantor Fitzgerald. "It could be over-enthusiasm, it could be the way Google charted, but there is obviously a lot of speculative buyers who think this could be an Asian Google." Shares of Baidu surged as high as $151 in intraday trading and closed Friday at $124.
Baidu is tiny by U.S. standards. The company earned $1.8 million on revenue of $13.6 million during the first half of this year. Investors are betting it will grow rapidly as more of China's population becomes hooked on the internet.
Despite its investment in the company, Google represents a major threat to Baidu because the company is gearing up for a major push into China. Yahoo and Microsoft, which rank second and third, respectively, behind Google in U.S. share of the search engine market, also have designs on China.
Although its business model mirrors Google's, Baidu faces different challenges. China's Communist government and its history of censorship pose the biggest potential stumbling blocks. In 2002, the government shut down Baidu for a week and fined the company for producing search results with content considered "socially harmful," according to Securities and Exchange Commission documents.
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Amazon tunes up: The digital-music field may soon be getting a bit more crowded. Internet retailer Amazon reportedly is moving toward offering a digital-music service, putting it into competition with the likes of Apple, Napster and RealNetworks.
The Wall Street Journal reports Amazon (AMZN) has held talks with record-label executives in the past two weeks about licensing music.
Citing people familiar with the discussions, the Journal says Amazon is talking about a music offering that would include options such as song-by-song downloads and a monthly subscription service. The expectation is that Amazon wants the service online later this year.
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AOL goes shopping: America Online said Thursday it has bought online storage company Xdrive to meet the growing needs of consumers with rapidly expanding collections of digital music, photos and other files.
AOL did not disclose financial terms but said it would operate Xdrive as a wholly owned subsidiary and continue to sell storage and backup services through Xdrive.com.
Nonetheless, AOL will likely incorporate Xdrive's technologies into its existing services, just as it had after buying anti-spam company Mailblocks last year. The Xdrive platform will also allow AOL to centralize storage for its e-mail, web journal, photo and other services and create new options for consumers. AOL officials, however, refused to provide specifics.
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Germanium for IBM: International Business Machines announced on Friday an improvement to a microchip manufacturing process it says will allow production of faster silicon devices for cellular handsets and other communication devices.
The company said it would begin offering customers its fourth rendition of a manufacturing technique that adds traces of germanium into chips made of silicon, the building block of electronics.
IBM (IBM) said it invented the silicon germanium process more than a decade ago, and has been improving it ever since. By adding the element to silicon -- a process known as doping -- the chip can operate at a faster clip. That boost is especially useful for radio communications devices, which need to modulate rapidly.
The Armonk, New York, company said the process will allow chips to operate at speeds of 200 GHz, or 200 billion cycles per second. That speed will help enable advanced communications technologies, including, it said, collision-avoidance radar for automobiles.
AP and Reuters contributed to this report.
