It’s worth noting that compared with Q4 2011, Alibaba also has had the strongest growth both in revenue and profits.

If these numbers are any indication, Alibaba is likely to hold that top spot on the profit charts for some time to come. But of course, all of these companies are making gobs of money, so I don’t imagine any of them are going to be all that upset about who places where on this ladder.

It’s also worth noting that Tencent’s fall in profits could be due to increased investment in WeChat, which is fighting similar apps like Line and KakaoTalk for international users, and which hasn’t been fully monetized yet. Baidu is also moving internationally – we just spotted the company making inroads into Indonesia — and splashed some cash on a big local acquisition, too. And of course, Alibaba is clearly not going to be content to rest on its laurels, as it just invested a boatload in Sina Weibo and rumors are swirling about a number of other acquisitions and a possible IPO on the horizon.

(via Sina Tech)

First of all, Ma clearly recognizes that some observers have been a little nervous about the e-commerce company’s step in to social media. After all, nobody wants to see Weibo turned into a glorified advertising platform, and Ma knows that. On the topic of how the services will be separated, he said:

If we turned Weibo into an e-commerce platform, we would be condemned by its users and also condemned by history [...] We’re now 18 percent shareholders in Sina Weibo, so if Weibo is doing well that’s good for us. We want Weibo to do well before we discuss what it can give Alibaba. Weibo is Sina’s thing, but if [Sina] needs us to do something, we will support them. That’s the only way this cooperation can continue.

Alibaba didn’t invest in Weibo for no reason. “The investment in Weibo is an important step in Alibaba’s future development,” said Ma. He didn’t name any specific reasons; we can think of a few.

But at the same time, Ma seems to suggest that the investment is also designed to help what he sees as a valuable service that might be in trouble. He says Weibo has increased transparency in Chinese society, and that Alibaba wants to help it be healthier and more successful. It’s no secret that Sina has struggled to monetize Weibo effectively, and although Ma never suggests that Alibaba is the white knight swooping in to rescue a damsel in distress, it sometimes feels a little like that’s what happened.

Everyone — Jack Ma included — agrees that Sina Weibo has really changed China’s society (mostly for the better), and everyone knows it faces a threat in WeChat. Users likely would never have guessed that a partnership with Alibaba might be the thing that really lets Weibo flourish, but that could prove to be the case. In ten years, we may well believe that Jack Ma saved Weibo with the Alibaba investment, allowing the service to continue changing Chinese society.

(via Sina Tech)

At present, the ads don’t seem to be very targeted. For example, the ads pictured above, on my own personal weibo feed, were exclusively for women’s clothing items (which, as a man, I don’t have much use for). So it certainly seems as though, at least for the moment, Alibaba probably hasn’t started thoroughly mining Weibo’s mountain of data yet. But we’re confident that it will, and Weibo users should get ready to start seeing more carefully targeted ads as time goes by.

In the meantime, it will be interesting to see if these new ad placements have any effect on Taobao’s sales numbers.

Now that we know it finally has happened, the next immediate question is why. It’s not hard to figure out why Sina went for this deal; the company has been having trouble monetizing Weibo and having an extra $586 million in the bank certainly (to put it lightly) helps. But what’s Alibaba up to here?

As my colleague Steven pointed out in his article yesterday, it’s clear that Alibaba has been interested in becoming more social for some time, as evidenced in (for example) its apparent investment in chat app Momo and its acquisition of music service Xiami. OK, so Alibaba invested in Weibo because it wants to get more social. Why?

Getting Customers Where They Spend The Most Time

The most obvious answer is that that’s where all the customers are. Weibo has over 300 million registered users, and while only around 50 million of them are daily active users, my guess is that Alibaba is less concerned with how many users there are — everyone in China who’s on the internet already knows about Taobao anyway — and more about how users are spending their time, and how much time is being spent on Weibo.

Alibaba’s e-commerce sites, after all, aren’t really fun places to “hang out.” But people hang out on Weibo all the time. It seems likely Alibaba is looking not so much to increase its userbase as it is to increase the amount of time users spend with products from Alibaba platforms in front of their faces. After all, many people go on Taobao only when they need something, but 50 million people go on Weibo every day to discuss the news, follow their friends, etc. Putting products there should help give Alibaba better access to the impulse buy than it currently has, simply because people do not generally load an Alibaba site unless they’re already planning to buy something. Alibaba, I suspect, is hoping that Weibo will help it snag users who had no plans to buy anything but fell in love with a product they ran across while browsing Weibo (or chatting or listening to music on the other platforms the company has invested in thus far).

And of course, it has already been demonstrated that people will buy things from Weibo. The Xiaomi Weibo sale, with over a million phones sold via Weibo in just five minutes, must have impressed on Alibaba’s leadership that Weibo users will fork over their cash via that platform when given a product they’re actually interested in. And if there’s one thing Alibaba has a lot of, it’s products.

Access to a Goldmine of Data

Of course, the other side of the coin is that Weibo’s massive databases can also probably provide Alibaba with tons of useful information about consumer behaviors, desires, and trends that it can use to optimize marketing and maximize sales. We know the folks at Alibaba like data, and Weibo has literally billions of public posts that can serve as useful data points on everything from sentiments about a particular brand or product to general insight into the thoughts and desires of particular demographics. And with full integration into Weibo, Alibaba platforms’ marketing could be tweaked to respond automatically and in real time to new trends as they emerged.

Think, for example, about Beijing’s “Airpocalypse” earlier this year. Now imagine that for Beijing-based users, next to every Weibo post about the pollution there’s an ad for an air filter or a mask on Taobao. That, I think, is why Alibaba is so interested in Weibo that it is willing to pay what many analysts feel is a pretty generous sum for an 18 percent stake.

Of course, there could be more to it than that. Or I could be missing the forest for the trees. We’re hoping to head more from Alibaba about its specific strategy here soon, but in the meantime, what do you think about Alibaba’s investment in Weibo?

China’s top e-commerce company has secured what could be the biggest web deal of the year in the country. Alibaba, which has been a lot more keen to venture into social media recently, has taken an 18 percent stake in Sina Weibo, the Twitter-like microblogging service run by Sina (NASDAQ:SINA).

Sina Weibo has over 500 million registered users, and has been China’s most talked about social network in the past couple of years. Despite all that enthusiasm, only 46.3 million are daily active users of Weibo, and the service has been a headache for Sina in terms of real-time censorship and great difficulty in monetizing it.

Alibaba’s stake in Sina Weibo comes with an option to increase that, notes the New York Times’ Dealbook blog, to 30 percent in the future. The deal also involves cooperation between these two Chinese web giants that will fuse social media and e-commerce. Sina and Alibaba expect such projects to bring in about $380 million in revenue from Weibo in the next three years.

What forms could such social commerce take? Last year, the startup phone-maker Xiaomi made use of Sina Weibo to sell some of its phones. This little experiment – it was not a long-term sales channel – yielded amazing results, with 1.3 million reservations for the phones made in just five minutes. We’ll likely see Sina Weibo do more like that – but on a more permanent basis, and with Alibaba’s consumer-oriented e-commerce sites, Taobao and Tmall.

Alibaba has invested in a few social media startups in the past few months, such as a funding round put into a flirting app, and the acquisition of one music streaming site.

In a statement this evening, Alibaba founder and chairman Jack Ma said:

We believe that the cooperation of our two robust platforms will bring unique and valuable services to Weibo users, as well as making the mobile internet a core part of Alibaba’s strategy.

Jack Ma, chairman of Alibaba, at today’s anti-piracy event.

China’s e-commerce giant Alibaba is working with five Chinese government agencies to fight piracy in China. Founder and chairman Jack Ma was on hand at today’s event, warning Chinese brands that it’s in their long-term interest to respect intellectual property laws. Ma said:

This is a long-term effort … we want the indigenous brands to work together to protect IPR, because if you do not participate today, tomorrow you are the victims. Hopefully in 10 years, the Chinese internet economy will be a much better place because of the efforts we have started here today.

Polo Shao, chief risk officer at Alibaba Group, said today that “big data” technology and traditional law enforcement resources will make investigation and enforcement of China’s intellectual property laws more effective. Shao added:

On e-commerce platforms, every single transaction creates a record, and every piece of information about sellers of counterfeit products is traceable. Internet technology … when paired with offline efforts can be used to create targeted initiatives to drive intellectual property protection as well as cut off the head of the snake in an attempt to purge society of counterfeit goods.

Of Alibaba’s web properties, its C2C marketplace Taobao has been especially plagued with pirated goods. Former CEO Jack Ma even joked in a previous speaking appearance that piracy somewhat added a surprise element to shopping at Taobao. Putting jokes aside, Ma is serious about cracking down on pirated items in its marketplace with this partnership with the Chinese government. The company will even set up an in-house anti-piracy task-force to be headed by Polo Shao. Ma calls China’s common counterfeit branding a “cancer” and a “tumor in society.”

According to Alizila, Alibaba’s corporate blog, “more than allegedly 94 million infringing listings were removed from Alibaba Group platforms” last year and about “5.5 million of them were taken down as a result of complaints from rights owners.”

Taobao was removed from the US Trade Representative’s notorious pirate watch-list a few months ago, with the organization citing major IPR improvements on Alibaba’s various web properties. But the situation is far from solved – least of all on the company’s own e-commerce platforms.

Tackling piracy – both online and offline – should greatly help China repair her tainted reputation on the global stage.

Yahoo China has announced today that its email service in the country will be shut next month. The Yahoo (NASDAQ:YHOO) email homepage has already ceased new registrations and is now informing current users that, from now to August 19, they’ll be transferred over to Alibaba’s ‘Aliyun’ email service instead.

Yahoo owns a 20 percent stake in Alibaba, the Chinese e-commerce titan that was first handed behind-the-scenes control of all Yahoo China operations backs in 2005, covering things like Yahoo email, search, and the news portal.

This Yahoo Mail shutdown could well signal the start of a total withdrawal from the country. While that hasn’t been confirmed, new CEO Marissa Mayer looks to be shaking up the (very many) failing parts of Yahoo, so the lackluster performance in China could well put the entire operation up for the chop.

Yahoo is China’s seventh largest search engine, with 0.28 percent market share of pageviews at the end of February of this year. That’s a fraction behind Microsoft’s struggling Bing, which has only 0.52 percent share. Baidu is the clear market leader. Aside from its woes in the search sector, Yahoo is also struggling up against the weight of local news and entertainment portals like Netease, Sina, Tencent, and even MSN.

Last December, Yahoo shut its rather dodgy music service in China, and also closed its blogging platform in Vietnam.

A few months before all that, Alibaba paid $7.6 billion to buy back about half of Yahoo’s previous stake in the e-commerce company.

UPDATE: The official statement from Yahoo! China:

As part of the agreement to buy back the Yahoo! stake, technological support for China Yahoo! Mail service will be suspended and we will begin the China Yahoo! Mail account migration process beginning April 18 (April 17 PST), 2013; we will offer several options to our users to make this transition as smooth as possible, and China Yahoo! users will have four months time to migrate their accounts to the Aliyun mail service, the Yahoo! Mail service in the United States, or another 3rd party e-mail provider of the user’s choice.

(Hat-tip to WantChinaTimes for spotting this)

After the kerfuffle between Alibaba and Google last summer over an Acer-made phone for Alibaba’s cloud-oriented mobile OS, it’s clear that China’s top homegrown OS cannot partner up with any handset makers that belong to Google’s not very open ‘Open Handset Alliance’. Today’s unveiling of six new Aliyun-powered phones therefore features an abundance of China-brand phone-makers, none of which will be familiar to the average Chinese shopper.

Alibaba’s newly-appointed CEO Jonathan Lu was on hand for the launch event, according to iFanr. The six new models are all budget handsets, ranging from RMB 799 to 1,399 (US$128 to $224) from five domestic brands: G’Five, Amoi, Yusun, ZOPO, and KOMI (pictured below). Nope, not heard of any of those either.

That’s a big problem for Alibaba’s mobile OS, which is up against the myriad appeals of iOS and Android, including popular big-screen phones from the likes of Samsung and more well-known Chinese brands like ZTE and Huawei. There are an estimated 160 million active Android users in China, and 85 million on iPhones.

Today’s event seems to be something of a reboot for Alibaba’s mobile ambitions. Indeed, the branding seems to have changed as well, with the “Aliyun” name ditched in favor of “Alibaba Mobile Operating System” (UPDATED to correct the new name; the “YunOS” name is just the URL. In addition to the name change, Alibaba’s official blog notes four new strategies to get more people onto Alibaba Mobile Operating System:

• A more focused online sales strategy for the phones, using the company’s own Tmall Taobao site, on yun.taobao.com.

• It will subsidize handset makers by paying them an ongoing fee of RMB 1 ($0.16) a month for every phone they sell, providing the phone’s owner remains an active user of the software.

• Alibaba will encourage software developers to build cloud-based applications for the OS through a RMB 1 billion ($160 million) program that will funnel funds to app makers through revenue sharing and other incentives or rewards. Full details will be revealed later.

• It is working with smartphone makers and telecom operators to give financing options to Alibaba Mobile OS phone buyers who sign up for mobile-phone service plans. New phone owners will be vetted via their purchasing history on Alibaba sites.

Alibaba’s own mobile OS launched in the summer of 2011. Aside from revealing one million sales 10 months after launch, it’s not clear how well it’s going. But with China having about 300 million smartphone owners right now, one million is a drop in the ocean. The e-commerce giant will be hoping that its new strategies and greater spread of handset options – along with their ability to run many Android apps via virtualization, sort of like how Blackberry 10 can do so – will give its mobile platform a much-needed boost.

Chinese startup Kuaidi Dache (meaning “fast taxis”) has flagged down seed funding to help the taxi-finding service grow. Centered around apps for iPhone and Android, Kuaidi Dache claims to have 300,000 users across the two cities where it operates – Shanghai and nearby Hangzhou – and covers 30,000 existing city taxi drivers. The startup sees 20,000 daily rides taken via the app.

The funding amount hasn’t been revealed, but according to Chinese tech blog 36Kr it takes the form of input from Ameba Capital’s Li Zhiguo, as well as a reported seven-digit RMB (hundreds of thousands of US dollars) investment from e-commerce company Alibaba.

While the Alibaba stake isn’t confirmed officially, it wouldn’t be too surprising, since the online shopping giant has been a lot more interested in startups recently, acquiring the social music site Xiami at the beginning of this year. Plus, there are rumors that Alibaba has bought the mobile ads platform Umeng, and is thought to have ploughed money into the flirty chat app Momo. Also, there’s a nice synchronicity to Kuaidi Dache operating in Hangzhou, which is Alibaba’s hometown.

Kuaidi Dache will use the funding to bring more drivers on board – it already covers 70 percent of cabs in Hangzhou – and expand to new cities.

This particular startup has some rivals in this space, such as Yaoyao Zhaoche and Didi Dache. The latter one has been incorporated into the updated Baidu Maps mobile service; since Baidu Maps has over 80 million users of its smartphone apps, that should be a big boost to Didi Dache.

If you want to see how these taxi-finding apps work, check out this six-minute report from Chinese TV. The reporter tries out booking a cab via SMS and phonecalls and finds that it can be a slow and hit-and-miss affair; then, at the 4:35 mark in the report, she tries out the Kuaidi Dache app and gets a cab arriving at her feet in just five minutes:

(Sources: 36Kr (article in Chinese), via Marbridge)

China’s top e-commerce player, Alibaba, also runs the nation’s leading daily deals site. Run under the familiar Taobao brand name and URL as Juhuasuan, the site is today expanding to include customers and daily deals in Hong Kong and Taiwan.

Centered around a new overseas site at hk.ju.taobao.com, the number of offers right now is very limited, but that will expand over time. The main Juhuasuan deals site has several thousand product listings at any given time, so it might be a while before relevant deals are made available to new users in Hong Kong and Taiwan. (UPDATED the stat about product listings to correct a mistake).

This new version of Juhuasuan will focus on deals for things like clothing, homeware, mother and baby products, consumer electronic accessories, and children’s toys. Travel and “lifestyle” deals will appear in a few weeks’ time, though it’s not clear if that will cover food/restaurants. But it will be an interesting challenge to Groupon in both Hong Kong and Taiwan.

The new site has ‘traditional’ Chinese characters, which is the script used in Hong Kong and Taiwan. Just last week we were talking to Daphne Lee, the director of Taobao international business, who told us how Alibaba is keen to expand its various e-commerce offerings to Hong Kong, Taiwan, Singapore, and across Southeast Asia, though there’s no word yet of the whole site being made available in English or other languages.

In today’s announcement, Daphne said:

[W]e firmly believe will enhance and complement the online shopping experience at Taobao Marketplace and Tmall.com for our more-than two million registered users in Hong Kong and Taiwan. In 2012, we continued to improve upon platform infrastructure and introduced new features such as the Alipay Card to make online shopping more convenient for Hong Kong and Taiwan consumers. Users can expect an even more diverse and comprehensive set of new and localized features and services to be rolled out in 2013.

This is the second consumer-oriented Alibaba site to venture overseas after the afore-mentioned expansion of the C2C Taobao shopping site. The Juhuasuan overseas service is promising delivery of its items in one or two days. For travel and lifestyle deals, QR codes or serial numbers will be employed so that shoppers can collect their deal from a retailer.

In our most recent daily deals industry stats, Taobao Juhuasuan has 47.8 percent market share by revenue – that’s way ahead of the indie Groupon clone Meituan with 13.1 percent share.

E-Commerce growth in China has been explosive, to say the least. Taobao’s at the head of that, and it’ll be interesting to see where they see themselves outside their mainland stronghold.

#14:47: This place has the “smell of money”, says Daphne to the audience, as some sort of surreal opening remark. This should get interesting.

#14:50: They’re looking to expand the Taobao ecosystem outside China. 7 million sellers on the platform now, and they’re looking at bringing more international users in. The two countries of focus are Hong Kong and Taiwan, though a lot of registered users from Malaysia and Singapore are using the platform too.

By end of 2012, 1.4 million users from Hong Kong on Taobao. In Taiwan, 600,000. 1 million from Southeast Asia – 280,000 of those from Singapore.

#14:53: Merchants coming onboard too, from outside China. International sellers like Microsoft opening Tmall stores. “Fashionable shoes brand” Charles and Keith have one too. *evil laugh* in response to question on Rakuten Vs Tmall.

#14:55: Localization and payment plans: “We’re looking at providing local services.” Plans are underway to involve local service providers for logistics and payments. They’re working with international shipping providers for better end-to-end tracking information for purchases. Alipay is a part of this expansion (accepting international credit cards etc., banks in other countries, local payment providers). Several partners-in-progress. “I can only reveal one…” *drumroll* Singapore’s DBS!

Sales pitch time now. DBS cardholders get rewards for all purchases above 50 RMB! /end sales pitch. Moving on swiftly.

#15:00: No luck on sales figures for international merchants within Taobao, or international sales figures of any kind. “That’s confidential,” she laughs. Friendliest “no comment” from a corporation this blogger has heard in a while.

#15:05: Does Taobao need to be more social? “We have forum!” says Daphne. “But in Chinese…I can translate for you.” Little does she know of ace TiA editor Steven Millward‘s l33t 中文 skills.

Tmall purchases coming from outside China too…but no plans for an English website yet. Not in 2013, atleast. It’s a big challenge, getting all merchant’s contents to make the transition too. “Anything is possible,” she says enigmatically. “But we need to focus on infrastructure and service first.” There is, however, a dedicated service line with English and Cantonese speakers for foreign users.

Mum’s the word on the possible Alibaba IPO. It was worth a shot.

#15:08: The Alibaba company, as a whole, is now taking baby steps internationally, Daphne says. But that pace will accelerate. Plug for Ali Express, kind of like an English Tmall.

#15:18: Over 6,000 people have used the Taobao API to develop services on the platform. Supplementary ecosystem activities gaining steam, with people targeting Taobao merchants for customer service training, inventory management. Customer focused apps too, such as comparative shopping. Open to working with startups to develop more services of this kind. Even considering strategic investments in particularly sharp ideas.

What does the future hold? More business operations. More infrastructure base. More marketing. More international merchants. More users. More “happy” users. More Taobao partners and developers.

In summary, Taobao strategy for 2013: MOAR.

This is a part of our coverage of Startup Asia Singapore 2013, our event running on April 4 and 5. For all our newest Startup Arena pitches, see here. You can follow along on Twitter at @techinasia, and on our Facebook page.

With two local indie artists onboard, Carlos Choi and Bamshak, RockItDub was launched in January of this year, a testament to options and choices. Everything is in the hands of the artist, including the distributed code and how much each song or album will cost. There’s even a collaboration with RedTag, wherein your codes can be printed on their Dubcards. If that’s too fancy for you, you can route the codes through SMS. Need party give­aways or freebies? How about printing your codes on coffee mugs or T­shirts?! Heck, you can even go old school and sell your digital music at gigs!

Dave Overton, one of the founders of Symph said,

“We’ve simply built the system to do so, and artists can decide how they want to package the codes and sell them. We also see an opportunity to provide a solution in a developing market since not many people can purchase digital music due to credit card requirements. Not many people are buying CDs anymore (let alone own CD players), and artists do well when they sell products at their gigs. We still like tangible products and we feel they would sell better at gigs than trying to announce from the stage “Guys, buy our latest album on iTunes.”

Pricing is storage volume based, and musicians are billed per code. The initial 50MB storage space is charged at PHP 5 ($.12) per code, and every succeeding 50MB costing another PHP 1 per code. It’s also nice to know that you’re free to upload as many tracks as your rented space allows! For example, a twenty track album of high quality, 10MB songs would run you up to 200MB, or PHP 8 ($.19) per code. Artists can opt to support try­before­you­buy codes or free trials. Note however, that RockItDub being in beta, this pricing model may change in the future.

Overton added, “All in all, we like music and we just think there should be a better way for artists to get paid doing what they love and for us to be able to support them and enjoy great music.”

When asked by TiA why they considered Facebook as their platform and not other social media sites such as Twitter, Albert Padin said, “Facebook has the page tab app functionality, which is perfect for what ease of integration to indie artist’s facebook pages. Indie Artists can set up the integration in just 3 – 5 clicks. Which starts off with them contacting us, and us giving them a link to kick-off the super easy integration. Twitter? We’ll consider it.”

Padin is also the founder of SpellDial, he’s now one of the 10-people team behind Symph. As to the goals of RockItDub, he simply stated they want “to be of service to as many artists as we can.”

It was at the tail end of 2012 when Cebu­-based Symph Studio conceptualized the idea: why not create an online platform, where other musicians could affordably and easily market their music, on the largest social venue known to man, Facebook? With many artist’s FB pages easily eclipsing their own websites, in terms of fanbase, this was a no-brainer. RockitDub was founded as a Facebook application linked to the artists’ fan page, which hosts the music and produces a voucher code that can then be redeemed for music downloads. It was an inspired touch, a lot like what MySpace evolved into.

Music has always played a large part in every facet of life in the Philippines. Now with the internet, it has empowered even the most basic and independent artists. In the last couple of years, we’ve seen quite a few music internet startups blossom, from ArtisteConnect and Twitmusic, to NDFY and the like. We’ve also seen multimedia startups like Radio Republic and New Media Factory flourish with equal success, a testament to the richness and potential this newfound avenue has to offer.

(Source: theBobbery)

Alibaba has restructured and refocused its English-language AliExpress site so that it focuses more on global shoppers. Previously aimed more at wholesale buyers around the world to source from Chinese suppliers – rather like the company’s Alibaba.com B2B platform – now AliExpress focuses more on selling individual items. In another shift, an increasing number of vendors on the site are not manufacturers, giving it more of a consumer-to-consumer feel.

While still serving small businesses who might want to buy in bulk – for which many merchants offer discounts – the site is now targeting shoppers, says an Alibaba representative, in Russia, the Middle East, Eastern Europe, and South America. Indeed, AliExpress now has more buyers in Russia than the US or the UK.

Claiming to have 38 million daily visitors from overseas, and with December 2012 revenues up 4.2-times over the previous year, it sees even more potential in a broader user-base of individual shoppers and small businesses in emerging markets.

Alibaba has also signed an agreement with Mastercard today that will see the two firms work more closely together – including for cross-border payments on AliExpress.

The Chinese e-commerce giant’s most well-known online store, Taobao, is also venturing outside of China these days. Daphne Lee, who’s responsible for managing Taobao’s business development and marketing strategies outside of home turf, has told us that Taobao has 1.2 million registered members in Hong Kong and 600,000 in Taiwan – plus the site is targeting e-shoppers in Singapore.

Coupled with Alibaba’s e-payments platform, Alipay, also being included in the cross-border memorandum with MasterCard, it seems the company is being more aggressive with its overseas strategy this year.

Daphne will be onstage at our Startup Asia event in Singapore next week, so this news will be added to my list of things to ask her about.

Alibaba founder and former CEO Jack Ma may have retired, but that certainly doesn’t mean he’s keeping his mouth shut. Earlier this week, Ma spoke candidly about Alibaba’s failures in the mobile arena; specifically its failure to keep pace with competitor Tencent’s WeChat (which is already paying off big time for Tencent). Said Ma:

We [Alibaba] invested a lot of money but we weren’t lucky enough, and we didn’t have that much innovation. When it comes to innovation, Alibaba isn’t as good as Tencent; they have the powerful WeChat.

Of course, that doesn’t mean Alibaba is in trouble. The company is still raking in boatloads of money, and Jack Ma thinks the future looks bright: “The next five years will be the golden age of e-commerce [in China],” he said at a conference on Wednesday.

Still, Ma is right that the company is weak in mobile, and Tencent’s WeChat might not look like a threat as a chat app, but it’s already moving toward monetization and online-to-offline e-commerce is reportedly one of the paths Tencent has chosen for the app going forward. Whether it can unseat Alibaba remains to be seen, but it seems very unlikely. Innovative or not, Alibaba is a beast in China’s e-commerce sector, and not even Tencent will be able to take it down without a real challenge.

(via Sina Tech, Image Getty via Businessweek)

242 million Chinese people shop online, and a great many of them do so on e-commerce sites run by China’s Alibaba. So when founder and chairman Jack Ma talks about the industry, a lot of people sit up and listen. Especially as he always speaks his mind.

That’s what we see in this new video in which Jack Ma talks, in English, at an investment conference in Hong Kong yesterday. Emphasising how his company – with sites like Taobao and Tmall – creates open platforms without the need for Alibaba itself to purchase stock and maintain warehouses (what is called B2B2C), he slams “the traditional B2C e-commerce model – which I call the Amazon model” as the wrong way to do business online. He adds:

(The B2C model) is going to face a huge challenge. We believe that putting (…) the traditional business just purely online – that’s not called e-commerce. In the future, business will not make money because of the scale, it’s because of the value – the different value – created. (…)

I checked Amazon. They have $52 billion but they still do not make money, so ‘scale’ does not make any sense.

He contrasts Amazon’s B2C model – and its huge scale – with what he calls Alibaba’s “efficiency” in its “ecosystem” that encourages businesses to get online and sell via its sites – Taobao for amateur shopkeepers, Tmall for small businesses and major brands. (UPDATED: I failed to hear the word “scale” in the video; it’s now corrected in this post).

In another segment, Ma – who’ll be replaced as CEO by Jonathan Lu in May – compared and contrasted the online shopping industry in China and the US. He observed:

The difference between China e-commerce and US e-commerce is that e-commerce in the USA is what I call the dessert – it’s supplementary to their main business, because the USA’s infrastructure of doing business is so good. So it is very difficult for e-commerce in the USA to grow, to develop, to surpass the traditional business.

But in China, because the infrastructure of commerce is too bad, then e-commerce becomes the main course.

You might like to skip the introductory waffle from some banker by going straight to 2:51 in the 45-minute video of Ma’s keynote speech:

(Source: Alibaba’s official blog, Alizila)

Jack Ma, the founder of China’s top e-commerce company, announced a couple of months ago that he’d step down from his role as Alibaba Group CEO. This afternoon, Alibaba has named Ma’s successor, ‘Jonathan’ Lu Zhaoxi, who’ll take over the top job on May 10 It’s a date that marks the 10th anniversary of the founding of Taobao, the company’s iconic amateur shopkeeper marketplace.

Ma had indicated that he was vacating the Alibaba hotseat as he was “no longer young enough” for such a role in the internet business. He’s 48. The new kid on the block, Jonathan Lu, is 43. Lu joined Alibaba in 2000. [UPDATED: We're going to nickname him JLu].

Alibaba’s official blog notes that Lu “has led three of its major divisions and steered Taobao, the group’s market-dominant online shopping platform, during a period of high growth.”

Ma remains as Alibaba chairman, and might well take up the burden of steering the company towards a massive IPO this year which could value the firm at well over $40 billion. In an internal email today, Ma wrote:

Jonathan and I have worked together for 13 years. During that time, he founded the Alibaba.com Guangdong sales team; was the founding president of Alipay; served as president of Big Taobao; stepped in as CEO of the then-listed Alibaba.com. He is currently the Group’s chief data officer and president of Aliyun Mobile OS.

He is passionate about and familiar with the Group’s various businesses. Not only has he contributed to building our culture and organization and developed many talented people, he also possesses a unique leadership style and charisma.

In a statement, new CEO Lu told staffers:

We live in an era of rapid change where pressures and challenges coexist, but we must not forget our purpose and keep in mind the premise of ‘Customer First.’ We must continue to … adhere to the principles of openness and transparency as we share Alibaba Group’s resources with the entire society.

(Though most of the data in this infographic comes from the reports of independent research firms, do keep in mind that as an infographic produced by Alibaba it isn’t coming from an unbiased source. Even so, though, we think it’s definitely worth checking out).

Like infographics? Here are some more you might enjoy.

(via Alizila)

Alibaba’s Jack Ma (left) and Tencent’s Pony Ma (right) are unlikely new biz partners.

China’s insurance regulator has confirmed approval, say sources, of a major new online insurance joint-venture between two Chinese web giants. As was first proposed last August, the new business sees e-commerce company Alibaba teaming up with social and gaming-oriented Tencent (HKG:0700), who – along with the country’s top insurer, PingAn (HKG:2318) – will soon launch this online-only joint-venture that will be called ZhongAn.

Neither Tencent nor Alibaba have commented on the apparent approval, pending official word from the China Insurance Regulatory Commission (CIRC) itself.

Unlike traditional insurers – like PingAn – the forthcoming ZhongAn company will not open brick-and-mortar stores across China. The new business will reportedly focus on liability and guarantee insurance, such as for homes and possessions. It’s not clear how much of a financial investment this entails.

Alibaba, which runs online malls like Tmall and Taobao, will be the top shareholder in ZhongAn with a 19.9 percent stake. Tencent (makers of QQ and WeChat) and PingAn Insurance will each own five percent. There are also six smaller shareholders, including online travel booking site Ctrip.

E-commerce rivals forced to work together

With China having over 200 million e-commerce shoppers at present, and an anticipated 420 million e-shoppers by 2016, these companies will be hoping that the populace is ready and keen to handle its financial services online as well.

Both Tencent and Alibaba are old hands in the online finance business, as they run major e-payments platforms (Tenpay and Alipay, respectively). Plus, Alibaba has been micro-lending to small businesses on its e-commerce platforms for quite some time. Nonetheless, it’s still a major business move by the two web companies.

Tencent also has its own e-commerce business, making it a rival to Alibaba in several areas. But it’s likely that China’s strictly regulated financial sector necessitated the two rivals working together for this new business.

(Source: GlobalTimes; Image from Techweb.com.cn)

China’s biggest e-commerce company, Alibaba, now has a search engine. Using the name of its cloud computing division, the newly-launched search service is at s.aliyun.com and features tabs for searching news, sites, images, and maps. We reached out to Alibaba, but an Aliyun department representative could not comment on this new product.

Aliyun might be best known to Chinese consumers as the name of Alibaba’s own mobile OS, which launched back in July 2011 (and whose flagship Acer phone was notoriously shot down by Google last year). Since its inception, Aliyun OS has gradually expanded into other web-based applications, such as an Android app store and online maps. The search engine is the newest step in Alibaba’s array of offerings that encompass both mobile and desktop.

A search result for Shanghai’s weather in the new Aliyun Search. Click to enlarge.

China’s top search engine is Baidu, while Google has slipped to fourth position due to the not entirely level playing field caused by its partically blocked services. It remains to be seen how much Alibaba will push its new Aliyun Search, and therefore what kind of impact it might have on Baidu.

This isn’t Baidu’s only recent challenger. Just last summer, the software maker Qihoo launched its own search service, and quickly mobilized its large user-base to take up 10 percent market share. That caused Baidu’s stock price to suffer in the latter half of the year.

Aliyun Search is not Alibaba’s first search engine experiment, as the e-commerce company also runs the product search engine eTao. In the past, some of Alibaba’s rivals have balked at eTao – and even blocked its web spiders – and disputed if it can fairly index products from all online stores (as Alibaba inisists it does). It’s likely that Aliyun Search will be met with the same kind of resistance from concerned rivals.

So far, Aliyun Search seems pretty advanced, and even features thing like widgets (see the screenshot above), as pushed forward by Google and Baidu, for certain common search terms such as to give an at-a-glance weather forecast.

Boyfriends and girlfriends available for rent on Taobao

Pricing can vary widely depending on who you’re buying and what you want them to do. If you’d like this guy to come home with you for the holidays, for example, it’s going to cost you 800 RMB ($126) per day, although you can get 10% off if your hometown is in the southern part of the country. During that time, he writes, he’s willing to do all kinds of things, like helping you carry stuff, chatting with your parents, and even (depending on the circumstances) washing your parents’ feet. Drinking with the family costs extra, and don’t expect any hanky-panky beyond handholding, because it’s strictly off limits.

We contacted Taobao parent company Alibaba, but the company declined to comment publicly about whether or not this practice is permitted under Taobao policy.

In practice, it certainly seems as though it’s permitted, because finding rental boyfriends to take home on the site is quite easy. Rental girlfriends seem to be a bit more scarce (though there are still some available), and searches for “rent girlfriend” result in a “in accordance with the relevant laws, search results cannot be shown” error message, although many other similar searches still work.

With the Spring Festival holiday fast approaching, most people inclined to take advantage of this sort of service have likely already booked a significant other. But those of you interested in renting yourselves out now have a full year to prepare your Taobao page for next year. And how long can it be before a Chinese startup comes along to offer a dedicated platform for renting boyfriends and girlfriends? (Of course, there are plenty of traditional dating options like Jiayuan and Momo in China, too).

Crowdsourcing has become an increasingly popular way to raise money for new ideas in the West, but the concept hasn’t really taken hold in China yet. But that doesn’t mean there’s no desire to crowdsource things. Getting investment can be tough, and one Beijing-based startup called Meiwei Media thought of a novel approach: why not just sell shares of your stock on Taobao? The platform is well-trusted and robust, and while it was designed for selling actual objects, why couldn’t stocks be sold on Taobao, too?

The answer to that question, it turns out, is that doing that is illegal, at least according to the legal experts consulted by China Business News. Public companies must meet with regulatory approval before publicly selling stocks, and private companies cannot have more than 50 stockholders. Meiwei had already racked up 1,191 stockholders when its Taobao operation was apparently shut down, probably because it was offering its stock at rock-bottom prices: 1.2 RMB ($0.19) per share. That may not sound like much, but the company actually raised more than 800,000 RMB ($126,000) this way, though it now seems likely they won’t actually be able to keep it.

It’s not yet clear whether regulators will step in to deal with Meiwei, but searches for the company’s stock on Taobao no longer turn up any responses. Representatives from Meiwei told China Business News that there was definitely “risk” but declined to comment on the legality of the company’s fundraising activity. The company did, however, say, that its other investors would fund a stock repurchase in the event that its Taobao fundraising was declared illegal (which seems quite likely).

A spokesperson from Taobao parent company Alibaba told Tech in Asia that the Meiwei stock had been removed by Taobao:

These types of products are not allowed to be sold on our platform according to our listing rules, and as such have been removed.

(China Business News via Sina Tech)

1. China could overtake the US to become the world’s largest online shopping market

China’s 12th five-year economic development plan listed e-commerce as one of the priority sectors to develop. Its Ministry of Commerce announced that China is going to become the world’s largest online retail market by 2013. Regardless of whether this occurs in 2013 or 2014, given the vast netizen base in China and its constantly improving e-commerce ecosystem, China will become the largest e-commerce market sooner or later. According to a recent study that was conducted by my company ¹, in 2013, China’s online retail transactions are predicted to reach $251 billion – extremely close to $252 billion in the US. In terms of the number of online consumers, China has already surpassed all other nations, by possessing 228 million online shoppers – equivalent to approximately 73 percent of the entire US population. Whether or not China tops the world in 2013, the point is e-commerce has already significantly transformed the traditional retail landscape in China, and online shopping has become a central characteristic of Chinese consumers’ shopping habits.

2: Lower-tier cities will be more important in China’s online shopping landscape

photo: techzb.com

According to data released from Alibaba Group, the e-commerce conglomerate had an annual turnover of $160 billion (1 trillion Chinese yuan) in 2012. Sales in China’s lower-tier cities increased over 60 percent while the growth rate in first-tier cities including Beijing, Shanghai and Guangzhou was less than 40 percent year on year.

China’s inland provinces possess the greatest number of potential online shoppers. These shoppers are migrating online for the first time, learning from their counterparts in China’s major metropolises.

More importantly, with the improving logistics capacity in remote areas and improvements in online shopping safety, online channels will become increasingly popular among Chinese consumers from rural areas. The internet enables lower-tier consumers to access more products and brands, which may not be available in their local stores. This is especially good news for Western brands that want to try to reach more Chinese consumers given that building brick-and-mortar outlets in China’s central and Western provinces is risky. E-commerce therefore is a more flexible and cost-efficient approach to reaching the majority of Chinese consumers.

3. Mobile commerce in China is set to thrive in 2013

While many declared 2012 as the beginning of the mobile commerce era in China, m-commerce is set to explode in 2013. In the first half of 2012, according to the China Internet Network Information Center (CNNIC), 37.5 million online shoppers in China purchased products via their smartphones, which increased 59.7 percent year on year. Turnover of mobile purchases accounted for roughly five percent of the total transaction volume of all online shopping, and this share is expected to reach 15 percent by 2015.

Mobile phones have replaced desktop computers to become the main devices for accessing internet in 2012 ². Due to the overall increase in usage of mobile devices including smartphones and tablets, mobile commerce will keep on gaining popularity and grow in significance. In addition, barriers that hold back the development of mobile commerce in China are diminishing, and improved 3G network capabilities will considerably advance user experience for shopping via mobile devices. Moreover, mobile payment in China is evolving rapidly as well. Market research company iResearch, predicts in the following three to five years that China’s mobile payment market will increase at a rate of over 40 percent year-on-year.

China’s e-commerce sector will only grow in strategic importance for Western and Asian firms alike. As we begin 2013, these three trends will undoubtedly be key drivers for its growth over the course of the year. Companies and entrepreneurs seeking to capitalize on the potential of China’s e-commerce sector should keep these trends in mind as they execute on their business plans for 2013.

2011 saw economic turmoil and financial scandals that led to only two Chinese tech companies venturing to IPO in 2012. But 2013 is looking up. This year there’s the distinct possibility of there being nine major Chinese web company IPOs, among which will be the biggest ever that China has produced.

Buoyed by the solid progress of the small class of 2012 (VIPShop and YY), these are the names to look out for in the year ahead. Inspired by a longer list on QQ Tech, we’ve pruned that down to nine realistic contenders. Some of these Chinese internet companies have been more candid than others when it comes to intent or timing, but they are, to varying extents, likely to be hitting the stock tickers in New York or Shanghai in the months to come.

1. Alibaba

Let’s start with the big daddy, Alibaba Group, which runs market-leading e-commerce sites like Tmall and the iconic Taobao. Just yesterday we wrote of how Alibaba, according to rumor, has already hired two underwriters for its public listing in Hong Kong, thought to be coming mid-2013. Alibaba could well raise US$3 billion to $4 billion at a valuation of $35 billion to $40 billion. Yahoo owns a 20 percent stake.

2. 360Buy

It’s difficult to determine which would be the second most valuable company to go public, so the rest of this list is in no particular order. Though I think 360Buy is the next largest. It’s the main rival to the afore-mentioned Tmall in China’s fiercely competitive B2C e-commerce industry. In November of last year 360Buy attracted $400 million in series D funding, which effectively values 360Buy at $7.25 billion.

2013 has long been pegged as 360Buy’s IPO year, so it’s a case of the online store balancing its ability to attract investors despite a lot of losses on the books with the need to raise a realistic amount. Last year’s reports of it raising up to $5 billion by a public listing might prove to be seriously exaggerated.

3. Sogou

Sogou is the search engine and software division of Sohu (NASDAQ:SOHU). It’s third in China’s volatile search market with 7.92 percent share of pageviews (a few percent above Google) at the end of last year.

Sogou is Sohu’s top earner and has been for 10 consecutive quarters. Sohu bought back Alibaba’s 10 percent stake in Sogou last summer. It’s now ripe for being spun off and floated.

4. Qunar

Qunar has been rumored to be working towards an IPO this year for quite some time, and the CEO of this online travel site even said in January of last year that a listing made sense as soon as “the market stabilizes.”

China’s top search engine, Baidu (NASDAQ:BIDU), invested $306 million in Qunar in the summer of 2011, thereby taking a major stake in the travel store.

5. Vancl

You’ll notice that all but one of the list so far are e-commerce companies. And here’s another. Vancl runs both an own-brand store (like GAP or Uniqlo) online, as well as the V+ open platform mall. Vancl CEO Chen Nian explained recently how its cancelled US IPO at the end of 2011 turned out to be a bullet that he very narrowly dodged. There’s an interesting anecdote about how George Soros helped out.

As with Qunar, the wait for markets to improve is surely over for Vancl.

6. UCWeb

The UCWeb listing is one of the most likely of this bunch. The makers of the hugely popular UC Browser for smartphones, which has over 400 million global users, have made it clear that 2013 is their ticket. CEO Yu Yongfu has already explained that “It would be better for us, branding-wise, to be listed in the US. It would expand our brand name and make us better known.”

7. Cloudary

A particularly likely US venturer is the Shanda (NASDAQ:SNDA) spin-off Cloudary, which is its e-book platform subsidiary. A ringing of the bell at the NYSE sometime in April is rumored to be in the cards. Shanda Cloudary – formerly dubbed Shanda Literature – recently appointed a new chairman in ‘Robert’ Qiu Wenyou, a former investment banker at Merril Lynch.

Cloudary, as we saw with Vancl, is another cancelation casualty of a grim capital market towards the end of 2011.

8. Dianping

Heading back into the realm of e-commerce again, Dianping is often called “China’s Yelp” and is also the country’s third-largest daily deals site. But Dianping has not been outwardly chasing an IPO, so this one is far from certain. Nonetheless, the deals service has matured a lot in recent years and now has a claimed 40 million mobile users, so it’s at the stage where it might be ready to go public.

Dianping raised $60 million in fourth-round funding a few months ago.

9. Xunlei

Another 2011 IPO withdrawal, Xunlei is very keen to list to raise funds for its growing video streaming site. Back then, Xunlei was aiming to raise $200 million.

Trouble is, Xunlei also has a P2P file-sharing network that’s riddled with piracy. On top of all that liability, Xunlei’s main site is over-reliant on advertising, which is an unreliable source of sustenance. Nonetheless, Xunlei is very likely to resuscitate its 2011 IPO plans pretty soon, now that 2013 is looking like a much better climate for Chinese tech stocks.

(Hat-tip to QQ Tech for the partial list of names)

It was just yesterday that Alibaba founder Jack Ma said he’d be retiring from his CEO role at the e-commerce giant in May. And now Bloomberg suggests that Ma’s passing of the baton will not slow Alibaba’s progress towards an IPO. Indeed, the site says today that Alibaba has hired Credit Suisse and Goldman Sachs to arrange the public offering, which looks likely to raise $3 billion to $4 billion. For now, this is a rumor.

Alibaba will probably list in Hong Kong, not following the same path of local rivals such as Baidu, which listed in the US. The IPO looks set to be China’s biggest ever tech IPO. Alibaba runs China’s largest C2C shopping site, Taobao, the biggest online mall, Tmall, the most-used e-payment platform, Alipay, and several other products.

The financing that Alibaba raised for the partial Yahoo ownership buyback last September effectively valued the whole Alibaba Group at $40 billion.

Ma will remain as Alibaba Group’s chairman, but his successor as CEO has yet to be named. Yesterday Ma said that, at 48 years of age, he was too old to be running an internet business, and indicated that he was keen to promote someone internally to the top job.

(Source: Bloomberg)

Online payment is a lucrative market sector, and like almost other aspect of China’s tech sector these days, it’s going mobile. How mobile? So mobile that far-and-away market leaders Alipay are reporting that in 2012 the amount of money paid through their wireless payment system went up 546 percent compared to the previous year. Yes, you read that correctly.

Unsurprisingly, the raw user numbers have also gone up; Alipay reports 223 percent growth in wireless payment users over 2012. In fact, more people are now using Alipay to make payments via mobile devices than are using it via a PC desktop or laptop. That shouldn’t come as too big of a surprise given that it’s actually faster by a full minute to pay via mobile. It also means that a whole boatload of people are using the mobile payment system; given that Alipay as a whole has more than 700 million registered accounts, it stands to reason that more than 350 million of those accounts are now being used with mobile payments.

An Alipay spokeman told Sina Tech that the people using Alipay on their mobiles are mostly younger, unmarried males who use it for games and internet shopping. That shouldn’t come as much of a surprise — the internet, after all, is full of dudes who like games and prefer online shopping to the real thing — but it’s still interesting. It could be an indicator of further swift mobile growth if Alipay’s army of female shoppers also begin to switch to primarily wireless purchasing habits.

(via Sina Tech)

Jack Ma will soon step down from his role as Alibaba CEO

Alibaba founder and CEO has confirmed that, after building up China’s biggest e-commerce venture since 1999, he will step down from his role as CEO this year, just as recent rumors suggested. In an email to employees today, Ma, a former English teacher in his native Hangzhou, eastern China, said he was “no longer young enough” for this role in the internet business, despite being just 48. He wrote:

As a founder CEO, stepping down as CEO is a difficult decision, for this could be confounding especially for someone of my age who should be at the height of his career.

Ma will remain as chairman of Alibaba Group, but will formally step down from the CEO post on May 10th. A successor in this role, one of the biggest on the Chinese web, has yet to be named. His email conceded that he had “looked forward to writing this letter for a long time, and this moment has finally arrived.” The billionaire entrepreneur added that he wanted to make space for “the next generation of Alibaba people who are better equipped to manage and lead an internet ecosystem like ours.” He continued:

I believe that doing what makes oneself happy, staying within one’s own limits and being a good partner to one’s more capable colleagues, is the right thing for me to do.

Alibaba is now the world’s most valuable private tech company, and was recently rumored to be gearing up for a massive IPO in mid-2013. A changeover at the top makes this somewhat less likely to happen so soon.

Ma’s company powered the e-commerce revolution in China, which really started gaining momentum in 2004 when its C2C online mall Taobao turned China into a nation of amateur shopkeepers. And it famously defeated eBay in the country. Aside from that site, it also runs Tmall, Alibaba.com for global sourcing, its Alipay e-payment platform, a smartphone OS, and a lot more.

The financing it raised for the partial Yahoo ownership buyback last September effectively valued the whole Alibaba Group at $40 billion.

[Source: Alizila (Alibaba blog), via TheNextWeb]

Could 2013 be the year when a Chinese tech legend rides off into the sunset of retirement and (one assumes) maybe a little venture capitalism on the side? Maybe! A story in China Newsweek says that according to company insiders, Alibaba CEO and founder Jack Ma is planning to leave Alibaba at some point during 2013, and that the company’s management has already prepared for the transition.

Mr. Ma himself was a bit more cryptic about his intentions, but his comments to the magazine certainly also seem to imply his impending departure:

I have done Alibaba for 13 years, and if I don’t stop, I will lose out on other dreams. I don’t know which dream is best, but I think I should take advantage of the opportunities [I have], otherwise in the future they may no longer be available to me.

In other words: all work and no play makes Jack a dull boy.

We have contacted Alibaba for confirmation or comment on this story and will update it if we hear back.

You’ve long been able to buy pretty much anything on China’s Taobao, right down to a single tube of toothpaste. And now the huge C2C e-commerce site is going to make it easier to buy your groceries online with the launch of the Taobao Convenience Store next Monday.

The site can be found at 24.taobao.com, and is a direct challenge from Alibaba-run Taobao to China’s top food and groceries e-tailer, Yihaodian, which is majority owned by Walmart.

The new Taobao Convenience Store – which now has a preview page up, but won’t start working until the 14th – is basically aggregating all the food and consumables already being sold by lots of Taobao vendors, collecting them all together to make it easier for people to do grocery shopping on the site. It has a mix of regular and imported items, but initially will operate just in two cities; an Alibaba spokesperson explained to TechinAsia this afternoon:

The platform is a lifestyle platform that aims to meet the increasingly sophisticated needs of Chinese consumers by providing a wide range of imported food and lifestyle products. At this time we have already begun to cooperate with offline supermarkets, and in the first phase of the platform launch we will mainly service consumers situated in Beijing and Hangzhou.

Hangzhou is Alibaba’s base, in case you’re wondering why they chose that medium-sized city just south of Shanghai.

Taobao and its sister site Tmall racked up 1 trillion RMB (US$159.5 billion) in sales in just the first 11 full months of 2012.

The Xiami Radio and Xiami Music apps.

Just a few hours after Alibaba boss Jack Ma detailed the restructuring of the e-commerce giant into 25 more nimble divisions, a rumor emerges that the company has acquired the Last.fm-like social music site Xiami.com. [UPDATED: This was confirmed as true by Alibaba on January 11th].

Chinese tech blog 36Kr claims to have verified the acquisition with a reliable source. We reached out to Alibaba, but a spokesperson said the firm cannot “comment on speculation” as a matter of course. In terms of other evidence, a WHOIS search for Xiami reveals that the site is registered to an Alibaba Hong Kong HQ address (pictured below), and it’s the same address that appears for other Alibaba-run sites like Taobao.com, the company’s original online marketplace.

Click to enlarge.

While a music streaming site might seem like an odd fit for an e-commerce player, it could make sense with respect to Alibaba’s recent push to be more social. That’s seen in its own smartphone OS, its revamped group messaging app for iPhone and Android, its communities-oriented social network, its Pinterest-esque social pinboard that focuses on shopping, and also Alibaba’s purported participation in the huge series B funding round for the flirty chat app Momo. That’s all very social.

I’m a fan and regular use of the Xiami site, which also runs the Xiami Loop social DJ web app. Xiami was launched five years ago, and has over five million registered users, making it perhaps China’s biggest indie music-only social site.

[Source: 36Kr - article in Chinese]

With China’s e-commerce market consisting of so many sites, the rather unique Mizhe.com is making a business out of being an online shopping guide that offers discounts for shoppers on top Chinese e-tailers. That hasn’t gone unnoticed by IDG Capital Partners, which has invested just over 10 million RMB (US$1.6 million) in a series A funding round for Mizhe.

The investment news was revealed this week, but Mizhe founder Zhang Lianglun said that the IDG backing was wrapped up last summer and the funds have already come through.

As with social pinboard sites like Mogujie), Mizhe’s shopping guide monetizes from referral links to e-commerce sites such as Taobao, Amazon China, and many more. Mizhe claims to generate over 100 million RMB ($16 million) in sales via its platform, though it’s not clear how much revenue can be squeezed from all those referrals. The site says it now has millions of users signed up, and hundreds of thousands of daily active shoppers.

The Mizhe frontpage, which emphasizes getting discounts on China’s top e-commerce sites. Click to enlarge.

The discounts-oriented site claims to offer as much as 50 percent off some purchases, but most price-cuts will be just a few percent. The startup – founded in August 2011 – also has coupons, which are the focus of its Miquan.com sister site.

Founder Zhang Lianglun knows the e-commerce business, being a former employee of Alibaba, the company that runs Taobao and Tmall, the nation’s top two online malls.

Other Chinese e-commerce sites in IDG’s portfolio include top travel site Ctrip, and the Amazon-esque Dangdang. IDG also led the recent massive series C round in the afore-mentioned social shopping site Mogujie.

(Source: Kuailiyu – article in Chinese)

After the initial kerfuffle over Groupon clones in China a couple of years ago, the daily deals sector in the country ended up being dominated by a familiar name: Taobao. With 34 percent market share by revenue, Taobao Juhuasuan has shown that the homegrown e-commerce giant Alibaba was able to adapt to deals alongside its other online retailing sites. Over the weekend, Alibaba revealed that its own deals site hit 20.75 billion RMB (US$3.3 billion) in sales [1] in the whole of 2012. That figure is 2.03 times greater than it was in 2011.

Alibaba also disclosed that Taobao Juhuasuan (at ju.taobao.com), not to be confused with the C2C online mall that Alibaba runs at Taobao.com, has achieved a peak of 16 million visits. The deals portal saw an average of eight million unique visitors throughout the year.

The e-commerce firm has been diversifying its deals so as to differentiate Juhuasuan from its many competitors. One example was the recent promotion whereby household items like sofas and TVs could be specced and customized by buyers who had placed a deposit on the modded items. In this way, the daily deals industry is slowly merging with more conventional e-commerce models, as well as evolving out of the low-profit cut-price deals niche. Alibaba says it plans more promotions like that on its deals platform.

The Juhuasuan site has double the market share of its nearest rival, Meituan, in a highly fragmented market where thousands of smaller deals sites die off every year. The only major consolidation we’ve seen in the industry was when Alibaba’s major rival, Tencent, oversaw the merger of Groupon China with FTuan.

In other news from Alibaba that also involves huge numbers, the company said recently that its two online malls, Taobao and Tmall, generated $159.5 billion in sales in the first 11 months of 2012.

A new e-commerce business model? The Tmall promo page for pre-orders of American food products.

China’s top online store, Tmall, is trying out a special promotion that will see American foods sold directly by US firms to Chinese consumers. This is running through to January 15th, allowing shoppers on Alibaba’s Tmall to buy products like Alaskan flounder fish or fresh salmon, Hawaiian macadamia nuts, and Pepperidge Farm cookies.

The promotion is on the pre-orders section of the Tmall site (see it here), where folks in China can put down a deposit now on items – that’s the price seen in red text in the image below. Full payment comes upon final delivery, which is expected to be on the last day of this month – just in time for Chinese New Year on February 10th.

Pre-order prices. Click to enlarge.

The pre-order system means that the US foodstuffs companies know precisely how much to ship, and customers in China will see prices dip if more people order certain items. For example, the fresh salmon was originally tagged at 368 RMB (US$58) for a kilo, but is now down to 248 RMB ($39) with nearly 700 people having ordered the item already.

Alibaba’s in-house blog notes today that this scheme features input from the US Department of Agriculture’s branch in Shanghai. In a statement, Tmall’s senior director, Ma Xuejun, added:

[This] addresses Chinese consumers’ changing lifestyle needs and will enable merchants and suppliers to more accurately estimate consumer demand, thereby optimizing the supply chain and returning cost savings to both parties.

This tie-up with US food-makers is an example of the C2B (consumer-to-business) model that Alibaba, as an e-commerce platform that doesn’t buy or store its own inventory, is keen to promote. It’s a bit similar to the JIT (just-in-time) manufacturing process that’s a growing trend in online fashion retailing. A few months ago we heard Professor Zeng Ming, Alibaba’s chief strategy officer, say that “e-commerce is not just online sales, but transforming business in every aspect, step by step,” and part of that is by now allowing companies to sell in this kind of flexible and customizable way.

Tmall’s move comes at a time of ongoing concern about food safety in China amidst seemingly never-ending scandals about locally-produced foods and drinks.

A Lephone-made device. Will one soon be a vehicle for Aliyun OS?

China’s Alibaba, the nation’s biggest e-commerce business, might have suffered the indignity and hassle of having its flagship phone launch scuppered by Google in September of last year, but its smartphone OS is not dead.

Rumors circulating on Chinese-language tech blogs today suggest that Alibaba’s Aliyun OS will appear on a new flagship handset soon, possibly before Chinese New Year at the start of February. The new phone is thought to be produced by Shenzhen-based manufacturer Lephone (or maybe its English moniker is Blephone) [1]. That’s not exactly a great brand that’s going to inspire consumers, but there are few options for Aliyun OS now that Google has effectively prohibited its Android partners (in the Open Handset Alliance) from working with Alibaba on new phones.

The anticipated new Aliyun phone will hit all three of China’s carriers, and pack a Qualcomm Snapdragon MSM8625 1.2GHz chip under a 4.5-inch screen. It might cost as little as 700 RMB (US$112). Alibaba has not yet confirmed any of this.

But we do know that the e-commerce giant has resolved to push forward its own smartphone platform, and shortly after the Google slamdown the Chinese company opted to spin of its Aliyun mobile OS division and give it $200 million worth of investment.

Aliyun had no new flagship hardware in 2012 after Google persuaded Acer not to launch the Acer CloudMobile A800 in conjunction with Alibaba. But that was only after we’d posted our hands-on with the phone, which eventually never launched with Aliyun on it. The primary options for Alibaba are to either acquire a phone-maker, or pursue partnerships with smaller (and unknown and unloved) Chinese handset-makers.

[Source: 36Kr - article in Chinese]

Jack Ma - Chairman and CEO, Alibaba Group

China’s e-commerce behemoth, Alibaba Group, is playing its cards close to its chest in terms of a potential IPO. But rumors today suggest that Alibaba – which runs market-leading online malls such as Tmall, Taobao, and Alibaba.com – has actually pencilled in mid-2013 for beginning its IPO roadshow, with a public listing coming by the end of 2013 or in early 2014.

QQ Tech and a number of other Chinese tech and finance blogs claim that the rumor stems from within Alibaba, and that it’s a sign that the vast company is a lot more focused on raising funds than it likes to appear.

Alibaba runs the country’s top B2C e-commerce, B2B, C2C, and daily deals sites, making it like some huge combination of Amazon, eBay, and Groupon, and more. It even has its own mobile OS platform, Aliyun, which was under attack from Google a few months ago.

What’s the firm worth when it lists? Its recent buyback of a 20 percent stake from Yahoo (NASDAQ:YHOO) and the subsequent financing revealed Alibaba Group as a whole to be worth $40 billion, making it bigger than China’s top search engine, Baidu. Forbes’ Eric Jackson reckons that Alibaba’s dominance and growth could be enough to make it worth over $150 billion by 2016.

Alibaba’s two largest consumer-oriented online malls, Taobao and Tmall, recently hit RMB 1 trillion (US$159.5 billion) in sales for the whole of 2012 up to the end of November.

[Source: QQ Tech - article in Chinese]

Last year it was Chinese search engine Baidu that was removed from the U.S. Trade Representative’s (USTR) report on major piracy offenders, and this year it’s the turn of the e-commerce store Taobao to be scribbled off the naughty list.

The USTR 2012 list of “notorious markets” for piracy and counterfeiting has just come out, and it cites “positive action” by Alibaba-owned Taobao – a huge online marketplace where anyone can be a shopkeeper – “which was included in previous Notorious Markets lists for the widespread availability of counterfeit and pirated goods in its electronic marketplace.” The report goes on to urge Taobao to streamline its takedown procedures so as to stay off future lists as well.

Alibaba’s Group’s VP of international affairs, John Spelich, said this morning:

We would like to thank the USTR for the acknowledgment of our efforts. The IPR issue is a long march in China, this is a milestone and it is only the beginning.

Still plenty of counterfeit goods for sale: A fake LV bag on Taobao today. Click to enlarge.

I’m surprised that fashion counterfeiting was not mentioned more fully in the new report, and it only takes a few seconds of searching on Taobao to see items like this fake Louis Vuitton handbag (here) for a mere 78 RMB (US$12.50).

Perhaps it’s because the Hollywood lobby has a lot more power than the fashion industry, and so pirated DVDs are more of a worry to the USTR (allegedly) than fake handbags. Back in September, Taobao signed an agreement with major US movie studios to remove infringing content being sold by Taobao vendors. [UPDATE one hour later: An Alibaba representative points out that Taobao works closely with the International AntiCounterfeiting Coalition (IACC) which represents a lot of firms, including major fashion brands].

Also removed from this year’s list was Sogou, the search engine run by Sohu (NASDAQ:SOHU), which “made notable efforts to work with rights holders to address the availability of infringing content on its site.”

New Pirates

But the 2012 USTR list saw some newcomers, including Chinese P2P and media-streaming site Xunlei. The report says:

This Chinese-based site facilitates the downloading and distribution of pirated music and movies, not only through deep-linking services, but also by offering cyberlocker facilities and through its own innovative high-speed P2P file sharing system.

On the plus side, Xunlei made something “innovative.”

Back in October of last year, Xunlei cancelled a planned US IPO, which was actually scuppered by a large part of the company being based on piracy. This USTR blacklisting of Xunlei puts the company under even more pressure if it wants to raise funds to pivot into a legitimate video-streaming and media site, which it is trying to do in some areas.

Also on the list is the Xunlei-owned site Gougou, which deep-links to lots of pirated content all across the web. Its Gougou.com site is offline at the moment.

The full USTR 2012 report is here (PDF download).

China’s largest e-commerce company, Alibaba, has just announced that two of its sites, Taobao and Tmall, have collectively hit RMB 1 trillion (US$159.5 billion) in sales for the whole of 2012. Well, from January to the end of November. That huge figure has been hit one month before the end of the year, reached on the night of November 30th.

That’s the equivalent – and brace yourself for this – of every single person in China personally spending 769 RMB ($122) on the sites this year!

When we heard Alibaba CEO and founder Jack Ma talk in September of last year at the company’s annual conference, he said he was aiming for “one trillion RMB in transactions” in China in 2012 on Tmall and Taobao. So he’s now got what he wanted.

The news is confirmed by an official post on the Taobao BBS (see it here in Chinese). For the sake of comparison, an Alibaba spokesperson tells us that the “2011 GMV [sales transactions] for Taobao.com was never announced, but for Tmall.com it was RMB 100 billion [$15.95 billion].” She adds:

This is a symbolic milestone in that it shows e-commerce has become an intrinsic part of how Chinese consumers shop for goods and services; this is also significant because we are seeing high speed growth in the [smaller] third and fourth tier cities, even outpacing consumer spending growth in first and second tier cities.

It is indeed a sign of the maturation of China’s e-commerce sector when the general populace now seems to be outspending the generally more affluent – but fewer in number – Chinese middle-class, who tend to live in wealthier cities such as Beijing, Shanghai, Wuhan, and (Alibaba’s hometown) Hangzhou.

The two shopping sites saw a total of $3 billion in sales in just 24 hours during China’s recent November 11th online sales day – a figure which surpassed the entire spending online in the whole of the US on Cyber Monday.

This graph shows the growth in sales transactions on the B2C and C2C online malls since Taobao first started in 2003:

It seems Alibaba’s plan to buy a 15 to 20 percent stake of Sina Weibo (which just hit 400 million user accounts) has hit a little snag: no one can agree on a price. Morning Whistle, citing an “industry insider,” says that talks between the two companies have stalled because the Weibo team wants more money than Alibaba is willing to pay.

Although any story coming from the anonymous and vague “industry insider” should be taken with several dump trucks full of salt, this particular story would not be surprising if true. Sina has long felt that Weibo is one of its most valuable properties, but its financials have, as yet, failed to live up to the hype. Things are improving — weibo advertising revenue doubled during Q3 — but I suspect that what may be happening in the boardroom is that Alibaba is offering a price based on what is actually on the books, and Sina is demanding a higher price that reflects their beliefs about how valuable the service will be when they finally figure out how to monetize it properly.

I suppose we’ll have to wait and see whether these reports are even accurate, but it’s hard to see why Alibaba is even bothering. The company certainly doesn’t need the money, and I’m not at all clear on why a highly profitable e-commerce company would want to put its hands into the highly volatile, politically sensitive, and thus-far-not-that-profitable microblogging sector.

Anyway, here’s hoping the companies can work it out in the end so that they’ll have a chance to adopt the lovely logo I’ve designed for them (above).

[via Morning Whistle]

We recently suggested that China’s biggest e-commerce sales/discounts day could beat America’s Cyber Monday in value – and that’s precisely what happened during yesterday’s “Double Eleven” online shopfest. Indeed, two of China’s biggest sites, Tmall and Taobao (both owned by Alibaba Group), beat out all US e-tailers by themselves, seeing sales transactions worth RMB 19.1 billion (US$3.043 billion) during the 24-hour promotional period.

That makes Tmall and Taobao’s Double Eleven sales worth more than double America’s entire Cyber Monday shopping spree, which brought in $1.25 billion in 2011. With Cyber Monday in the US growing at only about 22 percent per year, it’s unlikely that the next one, on November 26th, will see American consumers outspend their Chinese counterparts.

Back in 2011, Taobao and Tmall brought in $830 million in sales transactions on that special shopping day, so the two sites saw that figure grow by just over 360 percent.

Alibaba said this morning that it saw more merchants than ever take part on the sales day, with even major brands like Nike and Uniqlo offering discounts on their Tmall virtual stores. This year, a total of 10,000 sellers on Alibaba’s sites joined in the action, up from 2,200 last year. [UPDATED: Here are a couple of extra stats from Alibaba related to m-commerce purchases yesterday]:

The ratio of Taobao users using PC to those using Taobao Mobile on November 11th was 3:1, and the ratio from last year was 5:1. In the first hour, nearly 7 million registered users logged onto their Taobao Mobile app and reached RMB 100 million in transaction volume. Taobao Mobile hit RMB 940 million [$149.8 million] in transaction volume [in whole 24-hour period].

Of course, all of China’s top e-commerce sites took part in the event, with sales of up to 50 percent on some items, and a host of other offers and gimmicks. But other major sites in the country have not revealed sales figures for the full day, making it hard to piece together exactly how much was spent online during yesterday’s Double Eleven. Tmall’s closest rival in the B2C market, 360Buy, has not yet given any clues as to its performance, while the electronics retailer Suning (SHE:002024) revealed only that it got nearly three million orders and saw twenty times more sales this year than last.

51Buy, which is a much smaller Amazon-esque site, was a bit more forthcoming with its stats and said that RMB 50 million ($7.97 million) worth of stuff was sold up to 4pm yesterday, which was up 630 percent on its performance the year before. The online shopfest ran to midnight, so 51Buy will reveal updated figures later.

Wait… Is this how e-commerce works? I’ve been doing it wrong. (Photo: Getty Images)

November 11th became a bizarre and jokey Single’s Day in China in the 1990s, celebrated as a sort of anti-Valentine’s day. But back in 2008, the iconic date – 11/11 – got a new meaning, and a greater urgency, when China’s top e-commerce site, Tmall, decided to turn it into a huge online shopping sales day. It quickly became a new national institution, and now all the country’s e-commerce sites join in the cut-price e-commerce spending spree that’s known as Double Eleven. 2012’s Double Eleven looks set, for the first time ever, to surpass America’s Cyber Monday in terms of sales volume.

Last year’s Cyber Monday in the US, in data from ComScore, saw $1.25 billion in sales, which was up 22 percent from the previous year. But China’s Double Eleven, with discounts of up to 50 percent on many items – is poised to pass that huge stat. 2011’s 24-hour online spending spree in China raked in US$830 million in transactions for just the two largest sites in the country, Alibaba’s Tmall and Taobao – and that figure was up 373 percent from the previous year. Sadly, nationwide stats for all sites are not available.

So – brace yourselves for this – China’s Double Eleven online shopfest tomorrow will not only be bigger than America’s comparable day, but just two Chinese sites will likely beat that $1.25 billion sales figure by themselves.

Shop Till You Drop

Tmall’s special sales page…

… and this is 360Buy’s. Nobody said it’s gonna be pretty.

Looking at China’s top B2C e-commerce sites, they’ve all put up promotional pages ready for tomorrow (pictured above), and for months beforehand have been stockpiling inventory, hiring extra staff, and making sure that their site is up to the task of being hit by hundreds of millions of shoppers all at once.

The top five B2C shopping sites in the country – Tmall, 360Buy, QQ Buy, Suning, and Amazon China – are all pushing their Double Eleven deals to varying extents. The brick-and-mortar electronics retailer Suning (SHE:002024) is being particularly aggressive – as it has been in general for the past year or two, pushing its business more online – by giving away a small selection of stuff for free; plus, some of its other deals are available for three days, not just the regular 24-hour window.

China’s e-commerce market is also a ferocious area that has seen a few specialist sites fail earlier this year as the major e-tailers consolidate power and market share. It’s also a sector that sees a lot of price wars, so the Double Eleven shopfest is actually one of many chances for consumers to get a discount. Hopefully consumers will be looked after and not exploited tomorrow – we don’t want a re-run of some previous price wars that have seen stock for some items severly limited, leaving e-commerce shoppers feeling angered by an apparent bait-and-switch tactic. After all, sales should not be a blow-out, but a chance to win over new customers.

Just six months after Chinese deals and listings company DDMap attracted $40 million in funding, it has now wrapped up another major round, now series D, that was led by Alibaba Capital, the VC arm of e-commerce giant Alibaba, and CitiGroup’s (NYSE:C) Citi Ventures.

The amount of this new funding hasn’t been revealed, but it’s a major vote of confidence in one of China’s top local and O2O startups. DDMap has daily deals, local listings, and discount coupons for major retailers across China. These also appear in a suite of useful and good-looking apps for iOS, Android, Windows Phone, and Symbian.

DDMap CEO Xu Longjiang said that the funding will also see a stronger partnership with Alibaba – which also owns China’s top e-payments service, Alipay – and that will enable his company to grow faster.

Alibaba Capital’s MD, Zhang Hongping, confirmed the strength of the tie-up in yesterday’s announcement, and said that DDMap is well placed at the nexus of the mobile web and the O2O sector in China.

DDMap’s discount shopping app, DDCoupons (pictured above), now has a claimed 13 million users making user of coupons from 100,000 merchants in 38 Chinese cities. The app has also bolstered its location-based features in recent updates, and now can push relevant deals and coupons to shoppers when they come within three kilometres of partner merchants.

[Source: JFDaily - article in Chinese]

One of Dangdang’s new storefronts today on Tmall.com site.

The Chinese web business is usually characterized by price wars, feuds, and bitching. But at least two e-commerce firms are getting on warmer terms, as Dangdang (NYSE:DANG) has just opened up a virtual storefront on rival site Tmall.

The thaw in relations will see Dangdang sell, according to the company, 800,000 book titles and 300,000 kinds of general items in its two new Tmall storefronts (see here and here). That second link, the Dangdang general store on Tmall, sells everything from gadgets to baby’s nappies, reflecting the many product verticals that Dangdang offers.

Alibaba-owned Tmall launched its open-platform storefronts in September of last year with an initial batch of 38 Chinese B2C e-commerce sites opting to open stores at that time. Now Alibaba says there are 87 partners. Dangdang was one of several noticeable absences at the time, but now the Amazon-esque site seems to have had a change of heart and decided that co-operation is a better strategy. Tmall is China’s biggest brand-oriented online shopping site, with 41.5 percent market share at the mid-point of this year; Dangdang is down in sixth.

Dangdang first signaled an end to its resistance towards its rival back in May of this year when it unblocked the Alibaba-run product search engine eTao. That was after more than six months of – along with several other dissenting sites – blocking eTao from indexing its products in an attempt to undermine the fledgling product search engine.

[Source: QQ Tech - article in Chinese]

Although Chinese consumers are hot for the nation’s e-commerce sites – with one in seven urbanites shopping online each month – it can be a pain actually picking up your parcels. When the courier companies are working, you’re at the office. And although the courier companies will deliver stuff to your office, you’ll then have to carry it all the way home. And so two of China’s top online malls for brands, Alibaba’s Tmall, and Tencent’s QQ Buy, are tapping some convenience store chains to allow package pick-ups.

The Tmall tie-up launches today and initially covers just nine brick-and-mortar retail chains across five cities: Shanghai, Beijing, Jiaxing, Hangzhou, and Wuhan. But that amounts to 580 individual stores (like C-Store, pictured) as potential collection points. It’ll allow city dwellers to collect their online purchases at their convenience, 24 hours a day. The ideal picture is that your neighborhood store will support the scheme, so you can pick up your package at the same time you stock up on milk.

The scheme will soon be expanded to southern China’s Guangdong province so that there’ll be a total of 1,300 supporting stores across five provinces by next month – just in time for China’s hottest online sales day on ‘singles day’ – November 11th.

Tencent’s (HKG:0700) QQ Buy, a similar online mall to Tmall, started the same thing last month – but only in Hong Kong. It was a way for China’s biggest web company to take its online shopping platform into a new market, and a range of retail partnerships in Hong Kong mean that 1,200 stores are covered in just that once city.

[Source: Sohu IT - article in Chinese]

China’s biggest e-commerce site, the eBay-esque Taobao, is rumored to soon get the biggest facelift in its lifetime, drastically tidying up the clutter on the pages of its millions of amateur shopkeepers. According to information and images leaked out to eBrun and some other sites, Taobao’s visual refresh could be online by the end of this month.

The Taobao tidy-up is rumored to make the C2C shopping site look more like its B2C mall sister site, Tmall, whilst still keeping Taobao’s distinctive orange color-scheme. Both are run by Alibaba Group.

Click to enlarge the leaked image of Taobao's new store layout.

There’s not too much to look at on the leaked layout image (pictured right), but it looks to be focusing on improving and standardizing the left-hand navigation on a vendor’s storefront page. Currently, Taobao shop owners get a huge amount of customization freedom in terms of layout – and even plugins, however annoying they are – so it’s not yet clear if those aspects will remain so free.

Behind the scenes of the site, Taobao will also simplify its social communities for sellers and buyers on the site, merging everything into one program called “SNS”.

Taobao was started in 2003 as a homegrown alternative to eBay. With better localization than its rival, Taobao soon became a huge platform for hobbyist and professional shopkeepers alike. As of June 2012, Alibaba says that Taobao has more than 800 million product listings and 500 million registered users. It’s also slowly expanding out of mainland China and into Hong Kong and Taiwan.

[Source: eBrun; via cn.Techinasia.com - articles in Chinese]

I wish all tech companies had animals for logos - like Tencent's QQ penguin - as it makes it easier to do silly photoshops like this one.

A Chinese research institute, in cooperation with authorities in Beijing, has compiled a list of China’s top 100 tech and web companies by revenue. Looking only at the top 10, it’s full of familiar names from the world of social media, e-commerce, and gaming.

Before seeing the top 10 list, the institute’s white paper points out this eye-watering figure: China’s hundred hottest tech companies pulled in a total profit of 11.6 billion RMB – that’s US$1.868 billion – in 2011. That’s 26 percent higher than the industry average in the country.

1. Tencent (HKG:0700) makes China’s biggest social network and is also top in social gaming. Plus, it makes WeChat, the world’s biggest messaging app. Oh, and it does e-commerce. And lots more.
2. Netease (NASDAQ:NTES) must’ve had a good year to make it so high up the list – but then this list is about revenues, not a company’s market cap. Netease is primarily a web portal, but it also does online gaming (it runs World of Warcraft in the country), and also the Evernote-esque, Youdao Yunbiji service.
3. Baidu (NASDAQ:BIDU) is the nation’s top search engine by a big margin, and also has a major ad platform and some social services too.
4. Sohu (NASDAQ:SOHU) is another web portal, and is pushing its streaming video site pretty hard these days. It also runs the Sogou search engine which is sneaking up on Google’s market share.
5. Shanda (NASDAQ:SNDA; FRA:RZP) here means Shanda Interactive, which makes the Kindle-like Bambook e-reader, and has lots of web services like an e-bookstore, cloud storage, and more. Its gaming subsidiary is separate.
6. Alibaba is China’s biggest e-commerce company in every sector, running Tmall, Taobao, and Alibaba.com.
7. Perfect World (NASDAQ:PWRD) is China’s fourth-biggest social gaming platform.
8. Giant Interactive (NYSE:GA) is a tad smaller than perfect World in terms of gaming revenue, coming in sixth in that respect in the country. It runs games like Allods Online in the country.
9. Besttone (SHA:600640) is a telecoms firm, and the only one in the top 10 that we’ve never looked at before.
10. Sina (NASDAQ:SINA) is talked about a lot these days – and on this site – as it runs Sina Weibo, China’s hippest Twitter-like service. But Weibo is proving costly to run and hard to monetize – hence having China’s hottest social media site doesn’t equate to stellar revenue.

There are plenty more big names lower down on the list, such as Qihoo 360 (NYSE:QIHU) in eleventh, media outlet People’s Daily Online (SHA:603000) in 24th, and the kids social network Taomee (NYSE:TAOM) in 41st.

Of course, the list is open to debate because revenue is not always the best way to rate a company. Perhaps a more representative list could be formed by calculating every firm’s true valuation. If we did that, then Tencent would still be first, but Alibaba Group would be second as the recent Yahoo share buyback and fundraising effectively valued Alibaba at $40 billion.

[Source: Techweb; via Techinasia Chinese]

Actually though, it’s interesting that the NBA didn’t do this earlier. It is, after all, one of the most popular foreign brands in China, and other big foreign brands like Pepsi hopped on the Tmall bandwagon much earlier in the game (if you’ll forgive the mixed metaphor). I can’t help but imagine that the NBA could have made a killing with a Tmall store when the nation was caught in the grips of Linsanity earlier this year, for example.

Still, better late than never, eh? If you want to buy expensive official basketball stuff on Tmall, now you’ve got your chance. Nba.tmall.com is open for business, and high prices or no, I have a feeling it’s going to be a slam dunk.

(Yes, I know that’s probably the cheesiest ending I’ve ever written, but I just couldn’t resist.)

[via Sina Tech]

It’s not clear yet when 360Buy’s platform will be released, what payment will be like, or exactly how the thing will work; 360Buy is still in the process of researching and developing it. But from what 360Buy reps have said, it sounds a lot like Taobao Express, the Alibaba advertising platform that helps sellers market their products to users. That service, now split into the separate services Taobao Express and Tmall Express, has become a significant source of revenue for Alibaba. It certainly makes sense that 360Buy would want to replicate that formula.

And thanks to Taobao Express’s success, 360Buy’s ad platform will likely have plenty of interested sellers. One merchant on both sites told Sina Tech:

We tried Taobao Express and the results were not bad, so when the time comes we will probably also try promotional ads on 360Buy.

With 360Buy reportedly under some financial pressure, the added income could be a lifesaver. Although no release date for the ad platform has been announced, we wouldn’t be surprised to see it pretty soon. The company will also reportedly be expanding into games, again with the hope of improving the look of its financials. It’s not clear just how big a financial hole the company is in, but it certainly seems to be grasping at every potential revenue stream it can imagine.

[via Sina Tech]

This was a pretty eventful week in the technology world in China, as we saw some interesting developments surrounding big players Baidu and Alibaba, as well as some fresh funds for Innovation Works. Oh, and Apple’s disastrous maps. This week also included the day the music died for Google. So in case you missed any of it, here are the notable tech headlines from this week in China:

1. Alibaba Hands Over $7.6 Billion to Yahoo For Share Buyback, Financing Values It at $40 Billion

You know how painful it is to make a huge payment that seems to empty your pockets and your bank balance? Perhaps that’s how the folks at Alibaba felt this week.

2. Baidu’s Digital Patriotism Looks Like Corporate Suicide for Overseas Expansion Plans

Amid widespread anti-Japan protests in China that occasionally turned violent, Baidu thought it was wise to publicly choose sides, and planted a virtual flag on the disputed Diaoyu/Senkaku homepage on its homepage doodle. While Baidu has beaten Google in search market share, in my view it can’t come close in moral capital.

3. Panasonic: Violent Anti-Japan Protests Saw 3 China Plants Damaged, 2 Still Shut

Need further elaboration on story number 2? Here you go.

4. The Story Behind Renren, China’s Facebook-ish Social Network

Here’s an interesting overview of how one of China’s biggest social networks, Renren, got started. We spoke to co-founder Zany Zeng about how it all began.

5. Han Han vs. Baidu Legal Battle Settled: Baidu to Pay Peanuts, Wenku Stays Open

China’s most famous blogger, Han Han, has come away with a small victory in a copyright dispute with Baidu.

6. Innovation Works Adds $224 Million To Its Second Fund

Following Innovation Works’ recent $148 million second fund (aka ‘Fund II’), Kai-Fu Lee’s incubator has added another $224 million to its investment war chest.

7. China’s Alibaba Spins Off Aliyun Mobile OS Business, Supports it With $200M Investment

This was a surprise. Chinese e-commerce behemoth Alibaba is spinning off its Aliyun mobile OS division and giving it $200 million worth of investment.

8. Apple Botches China and Japan Maps in iOS 6

Have you upgraded your iPhone to iOS 6 yet? If you depend heavily on maps, you may want to wait a while. Many users the world over a complaining about the new maps feature, and China is no exception. Apple says it hopes to improve.

9. Google Shuts Its China-Only Music Service

Google has shut down its China-only music service, according to an official blog post from the company. It was originally launched in March 2009. And then, ending what was an opportunistic week for Baidu, it jumped on the ‘music’ moniker, changing its streaming and downloads service’s name from ‘Baidu Ting’ to ‘Baidu Music’.

10. Apple’s iOS 6 Comes With Sina Weibo Integration, In and Outside of China

We were surprised to find that Sina Weibo isn’t just integrated for users who opt for Chinese language. But it is also integrated for international users, or iOS 6 users who opt for the English language setting.

That’s all for this week, folks! For our full spread of China coverage, you can click here or subscribe to our China RSS.

Anyone who has been following the yearlong series of blunders that has been the Chinese Railway Ministry’s online ticket sales platform 12306.cn has probably thought to themselves at one point or another: why don’t they just get Alibaba to do this?

Certainly that company or one of China’s other e-commerce giants has the technology and experience to create a more stable platform than the Railway Ministry apparently can. And with the bugs and blunders starting to pile up, it has got to be in the Ministry’s best interest to have a working website, because people are starting to wonder if people who can’t operate a web store should really be the same people in charge of high speed trains. In fact, the Railway Ministry has even reportedly considered partnering with Alibaba or Baidu to sell train tickets on more their more stable platforms. But no move has been made, and recently a Ministry rep confirmed that there would be no cooperation with e-commerce sites:

Our 12306.cn is a non-profit operation, we will not cooperate with commercial enterprises, and anyway we are confident in our own technology.

Where that confidence comes from is a mystery, and the Ministry’s explanation of its refusal to cooperate doesn’t make a lot of sense. Although Alibaba is indeed a for-profit enterprises, it and other e-commerce companies have in the past teamed up with government organizations to create non-profit ecommerce platforms like Taobao Sifa, the online auction platform Taobao created for the Zhejiang People’s Court (which, needless to say, is a non-profit government entity). Why couldn’t the Railway Ministry work out something similar? I have no idea.

There are, however, skeptics who claim that the Ministry won’t play with others because it needs to keep control of its database so that employees can manipulate the system to pick tickets on hold for friends, family, and connections. Needless to say, the Railway Ministry has denied this. But with another holiday ticket rush (National Day is October 1st) being buried in problems, it’s not hard to understand why people might come to the conclusion that there’s some foul play going on.

In the meantime, IT insiders in China have been helping net users buy tickets even as they mock the Railway Ministry site. But if you think even they can make buying train tickets easy, think again: one of the most popular solutions requires modifying an obscure Windows system file to include either of the strings:

• 122.228.243.22dynamic.12306.cn
• 61.183.42.94 dynamic.12306.cn

Is that the sort of thing users were just supposed to figure out on their own?

Although the National Day ticket rush is already a clusterfuck, the Ministry still has a few months to prepare for next year’s Spring Festival bonanza. With any luck, before that day comes, someone will be able to talk the Railway Ministry into giving Jack Ma a call.

I know you want to do this on your own, guys, but you tried it, and it’s just not working. How about you let someone who knows e-commcerce handle the e-commerce end, and you guys focus on making sure this never happens again, mmmkay?

[Oriental Daily and Yangzi Evening News via Sina Tech and Sina Tech, respectively]

In a surprise move, Chinese e-commerce behemoth Alibaba is spinning off its Aliyun mobile OS division and giving it $200 million worth of investment. It comes just a week after Aliyun suffered a major setback, hitting the global news when Google slammed it as an incompatible version of Android. Alibaba disagrees with that assessment, but the end result was Google preventing a new flagship Aliyun phone, made by Acer, from launching.

Though it’s not known if the move is related to this setback, it’s a significant development for China’s most ambitious homegrown smartphone platform. In a memo written by Alibaba founder and CEO Jack Ma that leaked out to media, Ma explains fully:

After two years of hard work mixed with trials, we have seen significant progress in the Aliyun OS business. We have built a strong team and also gained recognition from our business partners. To better safeguard the healthy growth of Aliyun OS business and further implement the [Alibaba] Group’s Aliyun wireless strategy, we need to make adjustments 
in terms of talent, organizational structure and the Group’s resource allocation.

The management is making the following decisions:

1. The Aliyun OS business will spin off from Alibaba Cloud Computing [Alicloud/Aliyun] as an independent operation.

2. Jonathan Lu [Lu Zhaoxi] will be appointed chief data officer and president of the Aliyun OS business; Wang Jian will be appointed chairman and chief technology officer of the Aliyun OS business and will continue to serve concurrently as chief technology officer of Alibaba Group.

3. The company will invest US$200 million into the Aliyun OS business, to strengthen its talent base, technology, and infrastructure.

Fellow Aliren [Alibaba employees], the company has a lot to strive for and a long way to go. Thank you to everyone that has made contributions to the development of Aliyun OS. I believe that the Aliyun OS business will be better than ever with all your support.

But with Aliyun’s flagship phone apparently canned due to Acer’s commitments to Google with Android, it remains to be seen how the cloud-oriented, Linux-based OS will fare in terms of sales this year.

I took a picture of the Alipay’s data screen, as seen below, which has lots of neat visualizations. I have also included my English translation within the picture to make it understandable.

Note that the data screen shows that Alipay has a whopping 700 million registered accounts. Obviously, that doesn’t translate to 700 million unique users and Alipay declined to comment on the ratio of active users despite several pressing attempts. But it’s quite fair to say that Alipay’s active accounts figure, I believe, should be ahead of Paypal’s 113 million active accounts figure. But in terms of global reach, Paypal surely has the upper hand with users spanning across 190 markets.

While it’s understandable that folks within mainland China do use Alipay, I’m kinda surprised that the Chinese payment service is somewhat popular in Taiwan too. According to the pictured data, Taiwan roughly has about two million Alipay users which is about ten percent of its total internet population – not too bad of a result. An Alipay rep explained to me:

Many overseas Chinese including people in Taiwan have started to shop on Taobao. In addition, there is also a large population of Taiwanese working in mainland China and shopping on Taobao. That’s why Alipay is quite popular among Taiwanese people.

Besides providing online shopping payments, Alipay also supports peer-to-peer money transfers, pay utility bills, credit cards, cable TV subscription bills – all of which make it quite a convenient online payment solution to have in greater China.

On a related note, its main rivals include Tencent’s Tenpay – which yesterday added support for social payments on its WeChat app.

Tmall is a good initial strategy in China for foreign brands

I always enjoy connecting with other Asia technology professionals to share insights on how to best leverage digital media and e-commerce in China. I recently connected with an industry veteran on who asked me, “Which Western companies are getting e-commerce right in China?” This was my response:

Online is becoming an increasingly important retail channel in China, considering there were approximately 210 million online shoppers by June of 2012. In my opinion, it is easier for foreign brands to open online stores on Tmall.com (Alibaba’s Taobao mall) at the initial stage given the existing large user base, one-stop services and technology support provided by Alibaba – and most importantly, the trust and existing shopping habits which Chinese consumers have developed through regular shopping on the platform.

Given these thoughts and the initial question, I found that there are many global brands that have official stores on Tmall. The following is a list of companies and brands that are successfully operating online stores on Tmall, broken down by industry.

• Computers & Electronics: Microsoft, Samsung, Dell, HP, Nokia, Philips, Sony, Nikon Sports: New Balance, Reebok 

• Beauty: Unilever, P&G, Loreal, Neutrogena, Olay, Maybelline, Dove 

• Clothing & Accessories: GAP, Esprit, Uniqlo, Wenger 

• Auto: Chevrolet 

• Health: GNC 



Additionally, many of these brands, including Samsung and Nokia also have a partnership with other China e-commerce companies. It is really smart to cooperate with local platforms and leverage the local understanding and resources these platforms have to offer.

Another approach to consider is building your own e-commerce platform like Apple or Estee Lauder, which have their own online stores. High-end or luxury products which need to maintain an exclusive distance from average consumers and popular brands might take this approach instead of opening stores on Tmall. Overall, I think this will not be easy given the different online shopping habits I mentioned earlier.

Lastly, Chinese online shoppers are price-sensitive, or at least very practical, in their online purchases. As a result, a luxury brand store usually can’t compete with those personal stores on Tmall which sell the same products at much lower prices. After all, Chinese online shoppers are young and not as sophisticated consumers as their peers in developed markets. They are willing to spend 5000RMB (about $790) to buy an iPhone, but not willing to spend 10RMB ($1.50) to buy the latest app. 



You know how painful it is to make a huge payment that seems to empty your pockets and your bank balance? Perhaps that’s how the folks at Alibaba, China’s biggest e-commerce company, feel today having just paid Yahoo (NASDAQ:YHOO) “approximately US$7.6 billion” to buy back half of Yahoo’s formerly 40 percent stake in the firm. It’s been in the works since May of this year, and today it’s finally all wrapped up.

The announcement explains:

The initial repurchase of shares, which represented one-half of Yahoo’s 40 percent stake in Alibaba Group on a fully diluted basis, was valued at approximately US$7.1 billion. Of this, Yahoo received approximately US$6.3 billion in cash and US$800 million in preference shares in Alibaba Group. Concurrent with the initial repurchase, Alibaba Group paid Yahoo a one-time cash payment of US$550 million in connection with the amendment of their existing technology and intellectual property license agreement. Under the terms of the agreement with Yahoo, Alibaba Group has the right to repurchase one-half of Yahoo’s remaining stake upon a qualifying initial public offering in the future.

So there’s an incentive in there to go for a major Alibaba Group IPO – including all its sites, like China’s huge Taobao and Tmall online stores – which is rumored to actually be in the cards in a few years’ time.

Alibaba’s founder and CEO, Jack Ma, said:

The completion of this transaction begins a new chapter in our relationship with Yahoo. We are grateful for Yahoo’s support of our growth over the past seven years, and we are pleased to be able to deliver meaningful returns to our shareholders including Yahoo!. I look forward to working with Marissa Mayer and her team in our continued partnership.

Indeed, that’s a huge profit for Yahoo (which is now down to a 20 percent stake in Alibaba), which bought its huge slice in the fledgling e-tailer back in August 2005 for a mere $1 billion.

Alibaba “financed the transaction with a mixture of cash on hand, senior debt and the issuance of convertible preference and ordinary shares.” It’s believed that China Investment Corp (CIC) helped out to the tune of $2 billion. The company points out: “The new equity financing was completed at a valuation of approximately US$40 billion.”

With apologies to Matt Groenig.

So, you’ve heard the Google smackdown on Acer’s planned partnership with China’s Alibaba to make its latest flagship Aliyun OS phone. Where does that leave the cloud-oriented, Linux-based Aliyun mobile OS now?

In further comments on this saga, the SVP of mobile at Google (NASDAQ:GOOG), posted on his G+ yesterday (via AllThingsD):

Hey John Spelich [Alibaba VP on global communications] – We agree that the Aliyun OS is not part of the Android ecosystem and you’re under no requirement to be compatible.

However, the fact is, Aliyun uses the Android runtime, framework and tools. And your app store contains Android apps (including pirated Google apps). So there’s really no disputing that Aliyun is based on the Android platform and takes advantage of all the hard work that’s gone into that platform by the OHA [Open Handset Alliance].

So if you want to benefit from the Android ecosystem, then make the choice to be compatible. Its easy, free, and we’ll even help you out. But if you don’t want to be compatible, then don’t expect help from OHA members that are all working to support and build a unified Android ecosystem.

Trouble is, it can be disputed that, in Rubin’s words, “Aliyun is based on the Android platform.” For starters, it’s not clear if the Android head honcho is referring to source code (which would be a legal issue, a bit like the Oracle vs Google trial that concluded in July), or merely to the convenience of Aliyun non-natively running some Android apps, and having a whole app store full of them [1]. But that’s a very grey area. To what extent is Aliyun truly and technically infringing on Android, or is Google merely taking offense?

It’s my party and I’ll cry if I want to

The cancelled Acer A800. Is this Google's actual beef: That Aliyun can run and benefit from Android apps? (Image: Techinasia.com staff). Click to enlarge!

If it’s the latter case of Google taking umbrage, then it’s a grim turn of events for anyone working on Android-based or Android-associated platforms. This is where the afore-mentioned Open Handset Alliance (OHA) comes in. This Android-focused agreement covers dozens of telcos, phone makers, chip makers, and more. But if the OHA is being used as a carrot-and-stick by Google – in the absence of a legal framework for preventing many forms of building on top of Android, even if it’s in a way that Google dislikes – then it’s effectively assembling an ad-hoc monopoly of hardware partners. That can serve has a way to beat down OHA partners from other projects which are not close enough to Google’s vision of Android. We’d argue that that’s what we’ve just seen develop this weekend, with Acer (a OHA member) forced to postpone/cancel its launch of the Aliyun-powered Acer CloudMobile A800 phone.

I don’t think Google is in any way scared of Aliyun as a mobile platform – one million in sales in the space of nearly a year suggest that various other forms of Android (yes, there are many – I wonder which others Google disapproves of?) are massively outselling the two Aliyun OS phones launched so far.

In response to Rubin’s latest missive (above), Alibaba’s John Spelich says:

Aliyun OS incorporates its own virtual machine, which is different from Android’s Dalvik virtual machine. Aliyun OS’s runtime environment, which is the core of the OS, consists of both its own Java virtual machine, which is different from Android’s Dalvik virtual machine, and its own cloud app engine, which supports HTML5 web applications. Aliyun OS uses some of the Android application framework and tools (open source) merely as a patch to allow Aliyun OS users to enjoy third-party apps in addition to the cloud-based Aliyun apps in our ecosystem.

It’s not clear if Google has made attempts to analyze Aliyun to determine if those Alibaba claims are true.

Why does the OHA exist? Rubin’s longer post over the weekend on the “benefits and importance of compatibility” points out that, “We thought hard about what types of external factors could intervene to weaken the [Android] ecosystem as a whole. One important external factor we knew could do this was incompatibilities between implementations of Android.”

But Aliyun is not a fork of Android as such, and so it poses less of a fragmentation issue than the many other divergences in Android, such as apps or games that only appear on certain handsets, or with certain ROMs like HTC Sense, or run only on certain processors. Indeed, from the view of a user weighing up, say, an HTC Wildfire S in one hand, and a Haier Zing (Aliyun) phone in another, they’re totally different beasts. Indeed, with OHA members being so lousy at pushing out Android updates in a timely manner, one might even say that Aliyun represents a better ecosystem purchase, with a more direct update process straight from Alibaba. But I digress. The core issue is that unless Google can show us some Darwin-esque drawings of an evolutionary line between Android and Aliyun – not including permissible virtualization of Android apps, the likes of which is also exercised by RIM in its BlackBerry Playbook – then this still looks more like a gripe than a legally justifiable move.

So, to completely clear the air, Google should either take Alibaba to court over Android source code, or just put up its hands and say: Aliyun annoys us and we’d rather no-one in the OHA ever build stuff for them. That would at least be honest. Because the US search giant has not yet put any evidence on the table that suggests weighty technical reasons for apparently pressuring Acer (TPE:2353) to pull out of this China launch.

No cool phones = Aliyun’s death?

But, the biggest loser in all of this might well be Alibaba, China’s biggest e-commerce company. It has lost – perhaps cancelled permanently – its flagship Aliyun phone, leaving it sporting two less convincing Aliyun-powered smartphones. And, looking at the OHA list of members, it seems all of them are now out of bounds after Google’s recent judgement. So that means no Acer. No Asus. No HTC. No Lenovo; no NEC; no Sharp; no Sony; no Toshiba. Local phone-maker ZTE? Nope; an OHA member. Same goes for Huawei and Lenovo. Even the tiny Chinese brand Oppo, which has proved it can make some sexy devices this year, is off-limits. Is this an “alliance” or a mafia? You dishonored by family’s name, and now you’re gonna pay.

As we saw with the success of the startup phone-maker Xiaomi, well-known brands are not the main thing – an aggressively low price is one strategy that can win over consumers so long as the hardware looks strong and convincing enough, giving customers the sense of getting an awesome bargain. Superb design might help a lot too. But then how about a processor for a new Aliyun phone? The OHA monopolizes all the world’s maker chipmakers, even smaller regional firms like MediaTek. Will Google prevent them from powering Aliyun devices too?

So the Aliyun team is facing a tough task to put any new phone on the shelf, and to keep Aliyun itself alive as a mobile platform. I’d be surprised if it exists in a few years’ time – but that’s due to normal market forces (Android as a whole; iOS; Windows Phone – they’re all way more fun), not this Google move. Nonetheless, it’s being squeezed of life now, denied a proper fighting chance. Hit the comments with your thoughts on this issue going forward.

Hands-on with the Acer A800 - But Google seems to have torpedoed its launch forever.

After a couple of days of silence from Google (NASDAQ:GOOG), which looked to have been implicated in the cancelled launch of an Acer phone in China, the search engine has finally released a statement. The phone was to be the Acer CloudMobileA800 running the Aliyun OS, a year-old mobile platform created by Alibaba, China’s biggest e-commerce company.

[UPDATE: Scroll to bottom for remarks direct from Android man Andy Rubin].

Referencing its phone-maker partner, Google told the WSJ (paywall) earlier:

[Acer has] committed to building one Android platform and to not ship non-compatible Android devices. […] Compatibility is at the heart of the Android ecosystem and ensures a consistent experience for developers, manufacturers and consumers. Non-compatible versions of Android, like Aliyun, weaken the ecosystem.

So the assertion here is that Aliyun is a “non-compatible” version of Android; but Alibaba insists that it’s built from the ground up, based on Linux, and can run Android apps only by running them virtually and non-natively (a bit like in BlackBerry’s Playbook). Aliyun’s focus is on web apps. In reaction to Google’s words, Alibaba’s VP of international corporate affairs, John Spelich, said:

Aliyun OS is not part of the Android ecosystem so of course Aliyun OS is not and does not have to be compatible with Android. It is ironic that a company that talks freely about openness is espousing a closed ecosystem.

Talking to TiA, John expanded on the ecosystem theme:

This is like saying that because they own the Googleplex in Mountain View, therefore anyone who builds in Mountain View is part of the Googleplex. Will someone please ask Google to define Android.

Previously, Google had told us that it couldn’t comment, while Acer emitted only a very vague apology a day after the last-minute cancellation of the dual Acer-Aliyun launch event in Shanghai. The Acer A800 was to have been the flagship phone for the Aliyun OS, and the first from a big-name hardware brand. Its two other phones are built by local partners K-Touch and Haier.

Anti-competitive?

So, what’s going on here? Google’s words sound even more odd when you think of phone-makers who do actually make what seem to be “non-compatible” Android devices and also regular Android phones – such as we’ve seen with Lenovo’s OPhone, which was a closed-source fork of Android made for China Mobile (but which never really took off as a separate platform). But Lenovo still gets free reign to do that. Perhaps Acer has a different kind of agreement/relationship with Google.

From Google’s words, which seem to have been buried late night Friday in the US (and behind the WSJ’s paywall), we might extrapolate that Google did put pressure on Acer [1] to pull out of the launch. Also, the US giant’s compatibility assertion doesn’t stand up to scrutiny, since Aliyun OS being Linux-based does not make it part of the Android ecosystem. Or perhaps the fact that Aliyun can run some Android apps is the actual – but unstated – core of the objection. But software virtualization isn’t illegal. Either way, Google’s argument looks weak.

[UPDATE: Adding Andy Rubin quote]: Android head honcho Andy Rubin has weighed in directly on his G+ page (via The Verge) and apparently takes a dim view (as I suggested above) of the way Aliyun runs Android apps:

We were surprised to read Alibaba Group’s chief strategy officer Zeng Ming’s quote “We want to be the Android of China” when in fact the Aliyun OS incorporates the Android runtime and was apparently derived from Android.

Based on our analysis of the apps available at http://apps.aliyun.com, the platform tries to, but does not succeed in being compatible.

It’s easy to be Android compatible, the OHA supplies all the tools and details on how to do it.

This Acer A800 running the Aliyun OS should've launched today... But it didn't.

Well, this is awkward. China’s biggest e-commerce firm, Alibaba, was due to launch a new flagship phone for its Aliyun OS, made by Acer (TPE:2353), at a Shanghai event this afternoon. But it was cancelled at the very last moment under mysterious circumstances – and now Alibaba claims that Google (NASDAQ:GOOG) in some way intervened to stop its Android partner, Acer, from taking part in the launch.

Acer is a partner of Google in building Android phones, and that seems to be at the core of Google’s objection. But a number of smartphone-makers build for two or more platforms, as seen with Samsung and HTC, so today’s developments are quite odd. Perhaps Acer has a contract with Google that would limits such outside partnerships. We talked to Google this evening, but a representative couldn’t comment, and we’ve to reached out to Acer as well, which has yet to explain anything. [UPDATE the next day: Acer says it can't comment as well].

Click to enlarge

This is an embarrassing incident for Alibaba. The e-commerce company distributed a notice via social media making it clear that Google caused this launch to be halted on account of its partnership with Acer. A spokesman for Alibaba’s cloud computing division (aka: Aliyun) slammed Google’s actions as “clearly unfair to consumers and we are concerned about the impact on customer access to competitive products.”

A separate Alibaba rep said:

We believe that by introducing the Aliyun OS we are giving consumers and hardware makers more options which is the foundation of a healthy and strong market. We think that it should be left to the market to decide.

The cancellation happened just after I’d already posted my hands-on review of the Aliyun-powered Acer CloudMobile A800 (pictured above), which I got time with at a separate event over the weekend. So, apart from a bunch of review photos from me and some other Chinese tech blogs, consumers will have to wait for the proper launch of what’s billed as the flagship phone for the Alibaba-made Aliyun OS. The mobile OS is Linux-based but is not a fork of Android, though it can run Android apps via virtualization. That’s not thought to be part of Google’s beef, though.

Aliyun OS launched last summer and – with the scuppering of the Acer A800 launch – is found on just two handsets so far, made by local manufacturer K-Touch and Haier. The Acer A800 was to be its first big-name device.

Today, the mobile OS created by Alibaba, China’s biggest e-commerce company, is getting its first big-name hardware in the sleek shape of the brand-new Acer CloudMobile A800. This is the third smartphone to carry the cloud-oriented Aliyun OS – coming after two less convincing efforts with some minor phone brands (from Haier and K-Touch). In May of this year, the one million sales milestone was reached for the platform as a whole – but that’s a tiny slice of the tasty smartphone pie.

[UPDATE: The launch was cancelled/postponed at the last possible minute; it's quite odd, and we're trying to find out why exactly. Nonetheless, enjoy our review!]. The new flagship phone is launched this afternoon at an event that’s starting right now in Shanghai with Acer GM Dave Chan and the Aliyun department president Wang Jian in attendance. We actually got a chance to have a lengthy hands-on with the new Acer CloudMobile A800 over the past weekend at the company’s annual AliFest event. In terms of hardware, the Acer (TPE:2353) phone has a 1.5GHz Snapdragon (MSM8260A) dual-core processor and a crisp, 4.3-inch hi-res screen that barely shows any distinguishable individual pixels. The phone’s back looks classy with a dimpled rear cover that looks and feels like that of the Nexus 7 tablet made by Taiwanese rival Asus. It’ll cost 2,999 RMB ($470), putting it slightly below recent Android flagships like the wildly popular Samsung Galaxy SIII.

Going hands-on with new Acer CloudMobile A800 and the Aliyun 2.0 sofware – which is not based on Android, but can run Android apps and games – the emphasis is still on web apps, on which the phone is focused more than anything else.

A phone for online retailers

Click to enlarge

Perhaps unsurprisingly, the mobile software has a strong slant towards online shopping and retailing – but not quite in the same way as Amazon’s Android-based tablet efforts, which are more about consuming mobile content. One of the core new features of the updated OS (“Aliyun OS 2012 Autumn edition,” says the phone’s settings) on the Acer phone is a specialist web app for merchants on Alibaba’s two biggest consumer e-commerce sites, Taobao and Tmall (pictured below). The e-tailer merchant web app gives lots of data – in line with the company’s recent push into real-time data on shopping habits – about where the visitors to your online store is coming from, the number of page-views, and some visual analytics as well. Another web app syndicates industry news relevant to online store owners on the Alibaba platforms.

Sure, that’s not whizz-bang awesome stuff for the average phone buyer, so the Aliyun OS as a whole still faces a huge challenge to lure folks away from the myriad charms of Android (the dominant smartphone OS) or iOS. But at least the hardware is now at a level that it stands a better chance of luring punters away from good-looking Apple, HTC, Samsung, and Huawei phones.

Cloud apps versus Android apps

Even my lousy camera shows that the HD screen looks crisp and lovely (Click to enlarge all images).

The Aliyun homescreens, as you swipe left or right, are mainly web apps – apart from that first, more familiar, grid of icons that you see. It can be a bit jarring at first to be thrown into loading web apps after swiping the screen (we’re used to having to tap our way into apps), and that’s another area where it’s a tough sell up against Android or iPhones. But the advantage of web apps is that they never need updating, as developers can update them in real-time.

Android apps do run within Aliyun, and the main homescreen features the company’s own app store which plays host to lots of recognizable and popular apps and games, both paid and free.

The pre-installed apps on the Acer phone are the same as when the Aliyun OS launched last year – things like cloud notes, email, and online maps – all created by Alibaba itself. Other core features include automated backups to the cloud once you connect the phone to your computer (using your PC’s web connection), and a ‘find my phone’ service that comes with remote lock-and-wipe options.

We’ll have to wait and see if this more credible Acer hardware can drive stronger sales. As well as Android in general, this is also up against the rival cloud-oriented mobile OS from Baidu (which is a fork of Android), China’s search engine giant, which also has three smartphone partners so far. Plus, it’s not really a great day to launch a new phone, as Chinese geeks wake up to the new iPhone 5 that was revealed overnight.

Above: the Aliyun app store; Below: the exclusive web app for Alibaba's online marchants

Above: Aliyun's own online mapping service; Below: The newest version of the mobile OS.

At day two of the China Internet Conference, Xu Ji, product engineer director at Alipay, revealed an interesting stat that mobile payment on Alipay is one minute faster than on PCs. For folks who are new to Alipay, it is a popular payment wallet/gateway which allows users to store credits and pay via credit card and escrow services.

While the mobile screen is a limitation, Xu says that building for mobile forces engineers to remove unnecessary items on the screen to ensure users can check out as soon as possible.

In 2011, the male to female ratio using Alipay mobile payment was 56 to 44. He explains that the initial user wave was techies but in 2012, the male to female ratio reversed to 46 to 54. There are now more females using Alipay, and Xu believes that e-commerce has gone mainstream and is slowly becoming a norm.

Xu also released figures stating that many mothers use Alipay at around 3am. Xu explains that they usually checkout baby-related items such as milk powder and diapers. So a reasonable explanation is that they stayed away to take care of crying babies. And shopping via mobile phone is a common activity for them to pass time while taking care of babies.

Alibaba-owned Taobao.com, China’s largest C2C online marketplace, began expanding to Hong Kong and Taiwan early this year, Tech in Asia learned in a press meeting with Hong Kong and Taiwan media on Monday. It has been hush-hush as the overseas teams in Taiwan and Hong Kong have been laying the foundations over the past months, which include logistics, payment, and customer service.

While the preparation work is still ongoing, Taobao Hong Kong and Taiwan have racked up impressive early numbers. According to Daphne Lee, director of overseas business, Taobao has attracted 1.2 million registered users in Hong Kong and 0.5 million users in Taiwan so far.

To make sense of Taobao Hong Kong’s figure, 1.2 million is about a quarter of Hong Kong’s internet users, which I think is quite impressive. Taiwan requires more work as users face logistic problems because delivering goods from China to Taiwan isn’t as simple. Plus, Taiwanese users still have doubts about whether the goods will actually arrive.

Many people also still have the impression that Alipay can only accept payment from local China banks, which of course would limit Taobao’s overseas business opportunities. But it was just earlier this year that Alipay also enabled Mastercard and VISA, which is a big boost for international users.

Taobao’s move to Hong Kong and Taiwan is pretty straightforward. Besides the close geographic proximity, the populations of Hong Kong and Taiwan are also largely made up of ethnic Chinese, which lowers the communication barrier.

Taobao’s expansion has also brought about some positive changes for merchants as well. Daphne said that CatWorld, a Taiwan-based merchant, had only a moderate income when it was on Yahoo Kimo online auction. But the numbers shot up after it joined Taobao, generating over 6 million RMB (about $1 million) in monthly sales.

Honestly speaking, the combined population of about 28 million in Hong Kong and Taiwan is just slightly above Beijing’s population. It’s a small figure. And I’m certainly not saying that the Hong Kong and Taiwan markets aren’t important — they are, because I believe the regions have bigger-than-average spenders when compared to the mainland. The move to Taiwan and Hong Kong also gives the Taobao team a taste of overseas expansion, and I’m pretty sure they won’t just stop at Greater China. Daphne revealed that Singapore and Malaysia are seeing quite a bit of interest in Taobao, too. I would even say that Taobao in English isn’t too far away.

But it won’t come until Greater China is conquered, and knowing how brilliant Jack Ma is, I would bet on the Alibaba Group winning in Taiwan and Hong Kong.

Conducting business in any part of the world looks much easier as new technologies become available, and Indonesia is taking part in that revolution as people can now search more easily for SMEs in Indonesia with IndoTrading.com. To find out more, we talked with Handy Chang, the founder of IndoTrading, about the three-month-old startup and its big plans ahead.

The website looks promising, as users can look for a broad range of Indonesian SME businesses based on products, companies, and provinces. The website is available in both Indonesian and English, though some parts have not been translated to English yet. But I’m told those parts will be addressed immediately.

We’re told that most of the companies listed themselves voluntarily, and that the IndoTrading team suggests Google Translate for the English page. That said, I think English-speaking users can still understand about products and about how to contact suppliers. This is because the website very much resembles the global trading platform created by China’s e-commerce giant Alibaba, which was the inspiration for the Indonesian website, says Handy.

The website launched just three months ago, and it already has impressive statistics. Handy said it already has up to 5,500 products in the system with more than 800 companies registered, and 90,0000 unique visitors every month.

At the moment, the IndoTrading team is comprised of only eight people: two programmers, one marketer, two administrators, and three people for sales. Handy himself was previously the owner of Indonesian property listing website called RumahdanProperti.com, which was acquired by iProperty.com last year.

A new global factory?

Handy told us that he uses freemium memberships as his main revenue source. Premium memberships, which costs IDR 1.2 million ($125) per year, will get advantages such as a higher listing in internal searches, better statistics, and faster access to quotation requests from potential buyers. Premium members also get gold membership which can serve as a safeguard for consumers who might want to deal with a more reputable merchant. Handy said that they will get a CMS to help manage the website as well.

Handy looked to Alibaba for inspiration, noting that there are a lot of similarities between China and Indonesia, where both countries have huge populations and where the majority of them cannot speak English well. China’s high growth rate in exports can be attributed, he says, to the founding of Alibaba 15 years ago. With its Alibaba.com international site, everybody could easily source and buy Chinese products via the web. Handy hopes that IndoTrading can do the same for Indonesia’s exports.

He adds that Indonesia itself has huge export potential because the country is rich in resources: cheap labour and wonderful things such as crafts and agricultural and food products. Handy notes that at the moment, most Indonesian companies still focus on the local market because of huge domestic demand, but he believes that its exports must improve, saying:

The only thing we lack is marketing our products to overseas markets.

Regarding the competition, Handy says that he has yet to see other similar competitors in Indonesia yet, as most big portals concentrate on C2C (customer to customer) market – not this B2B (business to business) model. He claims IndoTrading to be the only portal with dual languages in Indonesia that’s concentrating on SMEs. Though we think IndoNetwork can be seen as one of IndoTrading’s competition. IndoTrading’s differentiator, as Handy sees it, is its investment in sales and support teams that educate SMEs about marketing their products online. Individuals are not allowed to post products.

The team also develops tools that help SMEs to conduct transactions online. The tools developed so far are quotation generating tools in PDF or email format. There’s also “bulk request for quotation” as an option for buyers, and statistics tools to measure enquiries by email, phone, etc.

Handy plans to introduce an escrow payments model in the near future to help attract overseas buyers. There’s also a plan to partner up with the government to help more SMEs market their products online. He says the hardest obstacle he would face is to educate SMEs from rural areas such as Papua about listing their products online.

Personally I think IndoTrading is on to something here. The startup may prove to become a great asset for Indonesian export market in the coming years. They do not have any investors at the moment, but are currently looking for one.

China’s biggest e-commerce company, Alibaba, launched its Aliyun mobile OS back in July of last year, bringing an entirely new mobile ecosystem into the crowded space that’s dominated by Android and iOS. And now Wang Jian, the president of Alibaba Cloud Computing (the department that created the Aliyun OS), has said that the e-tailer is willing to invest RMB 1 billion ($158 million) per year in its development, with a dedicated R&D team of 1,200 people.

Even with the might of the company behind it, the OS limped to one million in sales in its first year, and is currently found on two smartphone models – the K-Touch W800, and the budget Haier Zing (pictured). One million is a pretty large figure, but with nearly 200 million 3G users in the country, and Android and iOS usage growing at 401 percent in China, it’s tough to see how it can be a contender. But Aliyun will get a new flagship phone very soon – we’ve seen it, and it does indeed look like more of a world-class smartphone than the two that came before it – so that might have an impact by the time of next year’s sales figures.

The cloud-oriented OS focuses on web apps and is based on Linux – not adapted from Android. But it can run Android apps via virtualization, giving users access to lots of neat apps and games. In Wang Jian’s talk with local media, as reported by Techweb, the Ph.D and computer engineer said that Aliyun is mainly going after Google’s Android OS. He stressed that, in terms of mobile usage of cloud computing, Google wasn’t doing it right, and he and his team is confident that Aliyun represents the better way to do a mobile platform.

[Source: Techweb - article in Chinese]

That mobile spending spree will amount to RMB 11.64 billion (US$1.84 billion) in bought items in Q2 – that’s 487.9 percent higher compared to the same period in 2011. The very strong growth in Android and iOS in China will help push that forward even more, especially as nearly all of the country’s e-commerce players have very nice apps for those two mobile OSes.

So who are the main players in mobile commerce in China? Perhaps it’s no surprise that the two large online malls from e-commerce behemoth Alibaba – Taobao and Tmall – lead the way with a monstrous 75.6 percent share of mobile shopping [1]. Second is 360Buy, the B2C rival to Tmall with 6.2 percent. Those stats suggest that 360Buy is seriously underachieving in its mobile strategy, as Analysis International market share data for China’s B2C market shows that 360Buy’s share is more in the order of 15.5 percent.

The specialist e-tailers Vancl (for clothing) and Maobaobao (for handbags) stand out strongly in these m-commerce stakes:

[Source: iResearch]

Jack Ma - Chairman and CEO, Alibaba Group

Besides sharing Alibaba’s sneak peek into the future of e-commerce in China, Jack Ma’s keynote at AliFest 2012 was also largely about who he call “netrepreneurs.” And the veteran Chinese entrepreneur has much to say about entrepreneurship.

The point Ma is driving at, I believe, is to urge entrepreneurs to act in business the way think is right – follow the market and listen to consumers. In his usual amusing fashion, Ma says that if entrepreneurs were to listen to economists, then half of them will be gone. He went on to elaborate his point (translations are mine):

Economists are mathematicians and their analyses are based on the past, not the future. But entrepreneurs are people who look into the future.

Ma also said that “small is beautiful” in today’s business age. He shared an experience in Japan where he saw a small shop that is 147 years old and still surviving. Ma described that the business looks small but remains profitable – because it does its thing very well. He says that entrepreneurs who want to grow their businesses too big are crazy. (He says that Alibaba is about the right size.)

He then used height as a quirky example, stating that it is weird if you are taller than Yao Ming. Plugging in another joke, Ma says that it is also weird for folks to be smaller than his tiny frame.

Seriously guys, size is subjective and I’m sure Alibaba is “too big” a company to some of you. It is, after all, China’s biggest e-commerce platform in many sectors. But I think Ma’s point is to keep the company agile, lively, and always ready for the changing market.

To Ma, great entrepreneurs aren’t necessarily from elite colleges like Beijing or Qinghua University. He asked the audience of netrepreneurs if anyone is from such a prestigious university; few raised their hands. Ma then asked if anyone is from his more modest alma mater, Hangzhou Normal University, just a few miles from Alibaba HQ. A handful of hands were seen and the crowd clapped wildly. He added that most great businesses come from graduates of very regular universities – to yet more cheers from the audience.

His last point on entrepreneurship is about quality and profitability. And he aptly uses the recent e-commerce price war (between 360buy, Suning, and Gome) as an example, stating (translations are mine):

I disagree with the price war. Companies who don’t make money can’t be a healthy company, and they can’t grow continually and they can’t serve customers well. Instead of price, we should compete on quality. Making money is ethical and we make money because we want to serve more people in the future.

As Jack Ma walks up, the crowd here at its AliFest 2012 event cheered, clapped, and screamed. It was a great atmosphere which felt warm, and down-to-earth – and very entrepreneurial. It was a fairly long speech by the founder of Alibaba Group that consisted of his thoughts on the world, government, and today’s entrepreneurs. So while I digest his speech, I have quickly blogged the three things he shared which will define Alibaba – and also the future of all ‘netrepreneurs’ – in the next ten years:

1. A Better Platform

Alibaba has a range of services; all seven of them are: Alibaba.com, Taobao.com, and Tmall.com for online shopping; Aliyun as a cloud computing service and mobile OS; Juhuasuan for daily deals; eTao for product search; and AliFinance for loans. These seven tools, though already a good ecosystem for buying and selling online, Ma explained he wants to make them even better for merchants – the netrepreneurs. He explains that merchants are the guys who understand consumers the best. Ma didn’t elaborate what would be improved across the platforms though. An Alibaba rep whom I spoke to after the event stressed that this is a ten-year vision set by Ma.

2. Loans

Ma says that banks should support small- and medium-sized businesses (SMEs). But the banks can’t, for whatever reasons, Ma joked. So Alibaba will fit into this role, acting as a micro-financing platform to support budding e-commerce entrepreneurs. The company is doing it already. For merchants on its platforms and virtual malls, there’s no need for early revenue, no need for a contract, or preferential contacts (a common Chinese biz issue). They’re kickstarter loans. Alibaba just wants the merchants’ dedication to serve consumers well and be a profitable venture on the company’s e-commerce platforms. So far, Alibaba has backed over 15,000 enterprises with an average of 47,000 RMB (US$7,400) per loan. He stresses that Alibaba isn’t silly in this venture into loans, and that this program is surely set to make money. He said (translations are mine):

Making money is ethical. And a business that isn’t making money is regretful. You might as well do a social enterprise! […] We make money because we want to serve more people in the future.

3. Data

Data was also talked about yesterday by Prof. Zeng Ming, Alibaba’s chief strategist. And it is mentioned again by Ma today. While Tmall and Taobao have data that can be provided to merchants, Alibaba wants to provide better data. Data, which probably can help merchants serve consumers better. He says that with real-time data, you can forecast what will happen in the market.

Ma went on to explain that Alibaba needs more policymakers and psychologists. The average age of Alibaba’s staff is 27, and inevitably the lack of experience has caused users to be unhappy, such as during the protests among some merchants of Tmall when some structural changes were made. Alibaba has more than 80 million unique visitors per day on Taobao.com so even the slightest fraction who’re unhappy causes tens of thousands of dissatisfied users.

Ma added, “We believe data will improve the success rate of entrepreneurs. I believe data is the future.”

The crowd taking pictures of Ma on stage.

Prof Zeng Ming, Alibaba’s chief strategy officer

“Our competition with 360Buy is over. […] They’re struggling.” So said Alibaba’s Zeng Ming in a talk with media this morning, dismissing the closest rival to its Tmall site in China’s fierce business-to-consumer (B2C) e-commerce sector.

“I no longer look at 360Buy at all,” added Prof. Zeng Ming, Alibaba’s chief strategy officer, before wondering aloud if 360Buy can even make enough money to survive. China’s B2C sector is worth nearly $100 billion in terms of sales. While Alibaba’s Tmall leads with 41.5 percent market share, 360Buy seems a strong second with 15.5 percent of the pie.

But the slam on 360Buy was aimed more widely – at the whole B2C sector in China. In the talk at Alibaba HQ in Hangzhou, eastern China, this morning, Zeng stressed that Alibaba likes to be a platform, not a buyer of goods – and the same extends to the online shopping site Tmall. While 360Buy acquires all its goods and keeps them in its own warehouses – and is even now moving into delivering them via its own logistics company – Tmall does none of that. If you buy, say, a Nike T-shirt on Tmall, then Nike or its local partner sends that to you. In that respect, Tmall is B2B2C. The implication is that it’s cheaper, more sustainable.

Asked by a Forbes reporter if Alibaba might get into logistics itself, Zeng replied, “Definitely not.” Well, since Tmall doesn’t buy any goods itself, it doesn’t really have anything to deliver.

Zeng emphasized that the platform approach is better for the company – and, he claims, for the e-commerce sector as a whole. The attack on the centralized B2C ethos comes at a time when a few specialist, vertical Chinese sites have gone under, apparently weighed down by the costs involved. In recent months we’ve seen Vcotton hit financial troubles, and the once-promising Yaodian100 vanished off the web in mysterious and worrying circumstances.

Earlier this summer we reported that 360Buy might launch its much-anticipated US IPO – albeit at perhaps half the value of its previous funding round. Failing that, series D investment might be the way to go. The official line from 360Buy’s CEO, Liu Qiangdong, is that he has nothing but money – enough, even, for the controversial recent price war.

Prof Zeng Ming, Alibaba’s chief strategy officer, shared some of his thoughts on how e-commerce has changed lives in China and also business in China. E-commerce has grown so quickly in China, about 100 percent annually according to Zeng.

Thinking of the challenges, Zeng claims that logistics are the “bottleneck of e-commerce” in China. While e-commerce in China grows at 100 percent each year, the national logistics industry only grows at 40 percent annually. Zeng noted that out of 60 million parcels sent in China, 10 million are generated from e-commerce. He also talked about the role of e-commerce in China:

E-commerce is not just online sales, but transforming business in every aspect, step by step. E-commerce in China is revolutionary.

He went on to explain that third- and fourth-tier cities can’t get a good selection of products from brick-and-mortar stores at good prices. But now e-commerce allows folks in those far-flung cities to have an avenue to buy the same products as the people living in Beijing or Shanghai as long as they have at least a mobile phone to access the web.

Moving forward, Zeng believes that the future of e-commerce will be more customer driven, focused more on “built to order” and “mass customization.” He remarked that there will be a shift — from B2C (business-to-consumer) to C2B (consumer-to-business), which I believe is similar to the JIT) (just-in-time) manufacturing process.

In the traditional supply chain model, the lead manufacturer controls the chain. But Zeng believes that the supply chain management in the future will be integrated into the web. It will no longer be totally controlled by the lead manufacturer and information will be reflected real-time across the supply chain – which would require the company to be more flexible to demands both up and down the chain.

Zeng also noted that data is an important asset for Alibaba in the future. He said, quoting a famous management quote that, “If we can’t measure things by numbers, we can’t manage it.” Curious to know about that data it holds, I asked what’s the role of eTao, its product search engine, in Alibaba’s future. The topic is quite widely talked about in the country since Alibaba, as an e-commerce company at heart, tracks the prices of other e-commerce sites (many of which are their competitors) in China on eTaos.

Zeng says that what people search and find online in terms of products is important data for Alibaba but didn’t elaborate how Alibaba will use it. He did, however, note that data gets more valuable as more people get access to it – and so Alibaba is willing to share data with other e-commerce sites in China, including 360buy which is its closest B2c online mall rival.

Taobao's stats: 500 million users, 600 million product listings, 80 million daily unique vistors

The future of Alibaba Group will also consist of social elements which the company admits it is still figuring out. In response to my colleague Steven Millward’s question on how Laiwang and Aliwang would play a part in Alibaba’s social strategy, Zeng said:

[We’re] definitely not there yet […] But we have a sense of what to do for social commerce. We look at Facebook, Tencent […] We need to make it easier for sellers to interact. Most social in the west is geared only to social needs. But in China, it’s more about making life easier and maybe making money

Zeng also remarked that Alibaba is more of a service company than a technology company. And as a service company, Alibaba always looks at new technologies to make its e-commerce/service product better. He also hinted at a “concrete result” in terms of social in “two to three years time.”

By 2019, Alibaba hopes to host/help 10 million small businesses, create 100 million job opportunities, who will then serve one billion consumers.

Back in December of last year, we reported that China’s top online storefront, Taobao.com, was still blacklisted on an official US directory of piracy-tainted sites. But today the company behind Taobao, Alibaba Group, has done something about it, and has signed a memorandum of understanding (MOU) with the Motion Picture Association (MPA), a group affiliated with the Motion Picture Association of America (MPAA), to try stamp out movie piracy in the popular shopping service.

Clearly designed to stem the selling of fake DVDs on Taobao – a C2C site made up of tens of thousands of amateur virtual shopkeepers – the MOU will involve, says the e-commerce firm, “The adoption of more transparent criteria to address recalcitrant sellers of goods copyright owners have identified as infringing.”

So there won’t be any dramatic crushing of a mountain of fake DVDs by several bulldozers (which is fun to see), but there will be tougher monitoring of Taobao shopkeepers. The MPA represents studios such as Paramount, Sony Pictures, Universal, Walt Disney, Warner Bros – pretty much the lot.

This morning’s announcement explains:

Taobao.com also agreed to work with MPA to efficiently and effectively identify and remove listings of MPA’s member company products that they have identified as counterfeit or otherwise infringing, and to jointly work with law enforcement to pursue serial offenders.

That’ll likely extend to fake merchandise and general misuse of copyrighted names, as well as actual DVDs.

Mike Ellis, president of MPA Asia Pacific, added:

In the past year, both MPA and Taobao.com have been engaged in discussions to address the availability of infringing content on Taobao’s online marketplace. This MOU is a very significant step in promoting the legitimate sale and distribution of audio-visual content on the Internet. We are very confident of seeing positive and immediate results arising from this initiative.

Now, MPA guy, can we have a discussion about making genuine DVDs a sane price so that piracy is not such an attractive solution for people? No? Hmmmkay.

360Buy’s robots.txt file — a public file that controls which web-crawling bots can mine a website for information — now disallows the bot EtaoSpider, as you can see from the image above. This has actually happened before, but 360Buy had since re-allowed indexing of its site, which is what enabled ETao to compile its price comparisons for the warring websites last week.

360Buy, of course, claims that Alibaba’s price comparison engine is unfair, and given that Alibaba isn’t exactly neutral in China’s e-commerce wars, that makes some sense. But since it just recently revealed a third, uninvolved party to have better prices than 360Buy, the move to block Etao now looks childish and petulant. Which is probably how Jack Ma would describe this whole price war anyway.

[China Business News via Sina Tech]

Actually, a nasty price war hurts consumers’ interests the most. If the firms involved aren’t making profits, or are even operating at a loss [...] they can’t possibly provide after-sales service, let alone innovate new things [that would ultimately be good] for consumers.

And a price war isn’t just bad for consumers. Ma clearly thinks that it’s not going the companies engaging in it much favors, either. He said that the supposed branding value of this kind of price war is overstated, and although he was pretty polite, it’s clear he’s not a big fan of the way that 360Buy CEO Liu Qiangdong launched this war on a whim:

When I learned from 360Buy CEO Mr Liu’s weibo that this large scale price war was a ‘snap decision,’ I was very surprised. A large scale enterprise with tens of thousands of employees and billions of dollars in business launches a big price war, and it’s because a leader made a snap decision to do it! I admire Liu’s courage and his warrior spirit, but I don’t know how he’s going to be able to deploy his troops and allocate his resources to fight this price war for the next three years.

If the price war is real, is [360Buy] fully prepared for that? If it isn’t real, it will be difficult for the leadership to get a swift response of out its employees after this, because employees will be confused about the sincerity of the orders they’re getting. We’ve all heard the story of the boy who cried wolf.

So, depending on who you ask, China’s e-commerce price war is either good for everyone or bad for everyone. Of course, the whole thing looks to be a bit of a fraud anyway as it turns out Amazon — which isn’t participating in the mud-slinging price war — has prices lower than all of them!

[via Techweb (the image too)]

Jack Ma plays to the crowd at an Alibaba event

If China’s Alibaba Group IPOs, as many analysts think it will, in a few years’ time, it’ll be the world’s biggest ever tech IPO. But not too much is known about the e-commerce giant – which runs the country’s top online malls, Taobao and Tmall – outside of China. So a former employee of the company, Porter Erisman, decided to make a film about the rise of the company as it was powered by its founder, Jack Ma.

The result is Crocodile in the Yangtze: A Westerner Inside China’s Alibaba.com, which, Porter tells us, gives a “unique behind-the-scenes look at the eBay-Taobao battle” – the titanic tech tussle in which Jack Ma beat the American competition by better understanding the Chinese market. Taobao went on to become a wildly popular haven for amateur shopkeepers; eBay (NASDAQ:EBAY) became irrelevant except for a few people trying to sell some junk. In the full documentary, of which I’ve seen segments, Porter at one point says in his narration:

To eBay’s western managers, Taobao probably seemed too cute and flashy, but Taobao appealed to a new generation in China, that used the internet with a certain innocence and optimism that eBay failed to appreciate.

And so Mr. Ma’s entreprenurial story (he’s a former English teacher) is one which mirrors the emergence of China as a business superpower. Check out the short trailer below. Crocodile in the Yangtze has not yet been released, but Peter says he’s about to begin a festival tour that will take in the likes of the Palm Beach International Film Festival.

Porter stresses that “the film was 100 percent self-financed with my own savings” and that Alibaba “didn’t help fund it.” He adds:

Before leaving Alibaba I told Jack Ma that I wanted to write an independent memoir (in book form) of my experience at the company, in my own words, warts and all. He let me know that he wouldn’t have any objections. So in my last week at the company I gathered about 100 hours of video archives from the company that I intended to use as a reference for my book’s accuracy.

When I looked at the amount of footage available, I told Jack that I may consider making a film rather than a book and I was fortunate that he gave no objections and the company let me take the footage with no preconditions. Other than that, I had no additional access to Jack Ma or the company because I wanted to preserve the film’s independence.

The film ended up “drawing on 200 hours of footage filmed by more than 30 sources.” While it doesn’t show some of Alibaba’s more recent challenges – because the film was already in the can – such as the protests against new rules for Tmall vendors, the documentary is a sort of China biz 101 for those fascinated with China’s tech scene. And seeing Jack Ma rise from a trapdoor dressed in a manga-punk outfit while thousands of supporters cheer sure does make a Steve Jobs keynote look more like a Catholic Sunday mass.

Here’s the Crocodile in the Yangtze trailer:

We have been covering the Beijing-based flirtatious location-based Momo app for awhile now. And now there’s news from Sina Tech that the startup has received a whopping $40 million in series B funding. That puts its valuation, speculatively, to at least over $100 million. There were rumors stating that Alibaba was involved in this round of funding but an Alibaba representative declined to comment:

As a matter of company policy, we do not comment on speculation or rumors.

That’s not a denial, but it’s hardly a confirmation either.

So far the app has seen quite a bit of traction. We first reviewed it in December 2011, and by March of this year, the app had over two million users. It reached 10 million users in early August and according to its homepage counter, there are over 11 million users right now.

On average, Momo is growing at the impressive rate of one million users per month. At that pace it could potentially hit 15 million at the end of 2012 — or perhaps it could go even higher now that there’s $40 million in its war chest.

Source: Sina Tech