I try to avoid the “is Baidu a good stock?” posts. There is far too much competition on that score. However Information Arbitrage (article 6 months old) does talk about something other than Baidu being a local monopoly – it talks about what Baidu is doing. Baidu has been very good at getting in with Googles arch rivals eBay and Microsoft – and the eBay link is fairly thoroughly explored here.
One interesting question is whether eBay or Microsoft would ever tout Baidu ads to the outside world – an area where Baidu is currently very weak. This wouldn’t necesarily be that profitable, but it would spite Google. And eBay in particular are pretty sore with Google.