The Reasons: The Japanese has a different preference in their search from the Chinese. One thing they like to search over the internet is peoples’ names, as they like to read blogs of other persons. They are also very superstitious and like to search for information such as fortune telling, palm reading, etc. The different in preference require the search engine to be designed with a different ranking system. And Baidu has to readjust its search engine for these.
Another problem Baidu faces when developing Japanese market is the political tension between the two countries. Whenever there is a quarrel between the two, Baidu’s traffic in Japan could be affected. For example, recently the two nations argued again over Diyutai, an island over South China Sea which both claimed to be theirs. Just as the Chinese protested in China, the Japanese were doing the same in Japan. Baidu’s search engine was boycotted and traffic dropped.
However, Baidu still hopes to develop the Japanese market, as the online advertising market is much more mature than that in China. Japanese advertisers are much more willing to buy keywords from search engines. Also, cost per click for each keyword can be much more expensive than in China, something like 10 times.