Can Baidu Finally Bring Dell Mobile Success?


Just because Dell (NAS: DELL) will be the last major domestic PC manufacturer, that doesn't mean it can't travel abroad from time to time.

The Round Rock, Texas, computer maker has agreed to partner with dominant Chinese search-engine company Baidu (NAS: BIDU) in support of the latter's recent push into mobile, Baidu Yi. Analogous to Apple's (NAS: AAPL) prolific App Store platform and based on Google (NAS: GOOG) Android, Baidu has been working on its mobile operating system for quite some time. The company will replace Google's apps with its own bundle of native apps, like maps and music.

Meanwhile, Dell's ill-conceived shot at the oversized-smartphone/undersized-tablet market with the Streak 5 proved to be a mistake as it met its demise just a year after its launch. The company isn't throwing in the towel quite yet, having notched up to a 7-inch version that launched earlier this year. The stateside version currently runs Android on an ARM-basedNVIDIA Tegra processor.

Dell's smartphone sales aren't even significant enough for Dell to get its own spot on Gartner's recent mobile vendor market share report. They're probably being included in the generic "Others" category.

By building smartphones and tablets running Baidu Yi, Dell will have a chance to get its foot in the door of the exploding Chinese mobile market and compete with local OEMs like Lenovo. It hopes to make up for its domestic shortcomings by focusing its efforts overseas. The company recently decided to launch a new 10-inch Android tablet directly in China first instead of in the U.S. or Europe.

Baidu has done well by mimicking Google's moves and leveraging its dominant search-engine position to propel itself into other segments. Although with only about $1.6 billion in cash and equivalents last quarter, it is unlikely to follow Google's most recent move.

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At the time thisarticle was published Fool contributorEvan Niuowns shares of Apple but holds no other position in any company mentioned. Check out hisholdings and a short bio. The Motley Fool owns shares of Apple and Google.Motley Fool newsletter serviceshave recommended buying shares of Baidu, Google, Apple, and Dell and creating a bull call spread position in Apple. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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