EBAY vs YAHOO! The Prize? CHINA!

[rossshow]

http://news.google.com/news?q=Jack%20Ma%20ebay%20yahoo&num=100&hl=en&lr=&c2coff=1&safe=off&rls=SNYC,SNYC:2004-13,SNYC:en&sa=N&tab=wn

I saw this first on OTWA

http://www.otwa.com/community/showthread.php?t=32932

[10x]

China as a international market is scarer than nigeria, both for purchasing and selling to.

[rossshow]

"A Cooler Look at Yahoo in China," By Bruce Einhorn, BusinessWeek, 9/21/05

http://digbig.com/4erhx

[kailin]

Neither will win. Only the Chinese will win. That's the way the deck is stacked. Always has been.

Now, if I could just figure out how to get one of the GM minivans being made in China and sold to Chinese for US $5,000, that gets 48 mpg --

So, who wins? We can't even evacuate a city.

Guess it sorta depends on what you mean by "winning."

Motorola has been in China since Kissinger was there, I think. Last I heard, they're still not making money there.

[justjg]

I think it's mostly an Asian thing right now in that they are looking for control of the local markets over there.

Yahoo still has a horrible interface. If they can't make it work here they sure won't over there.

Alibaba is more interesting. They are making big moves in Asia and I have a hunch will be going more mainstream USA soon.

[Toy Ranch]

I think it's mostly an Asian thing right now in that they are looking for control of the local markets over there.

Yahoo still has a horrible interface. If they can't make it work here they sure won't over there.

Alibaba is more interesting. They are making big moves in Asia and I have a hunch will be going more mainstream USA soon.


You are a fucking retard and you smell like butt.

Alibaba and Yahoo are the same auction site over there.

Yahoo rules the Japan market, eBay doesn't even bother to open up an eBay Japan site.

Alibaba/Yahoo are kicking Eachnet/eBay's ass.

And... you still smell like butt.

[10x]

LOL not real smart is he Toy? :hazmat:

[Powerhouse]

:1chirol_r

[rossshow]

Toy. You are correct.

Alibaba sold 40% ownership to Yahoo.

http://news.google.com/news?num=100&hl=en&lr=&c2coff=1&rls=SNYC%2CSNYC%3A2004-13%2CSNYC%3Aen&tab=wn&ie=UTF-8&q=alibaba+yahoo

http://news.xinhuanet.com/english/2005-09/21/content_3519834.htm

potential deals involve Alibaba.com, the country's No 1 online B2B (business-to-business) service provider, in which Yahoo! has a 40-per-cent stake; and China's No 2 online travel service provider eLong.com, in which US online travel service giant InterActive has bought a 30-per-cent stake.

[kailin]

ok, so Yahoo has a minority holding ( 40% is a minority position, right?) in a Chinese company.

I know how this benefits the Chinese company.

Can someone please 'splain how it benefits the minority company? In terms of real money, that is.

Not just


:sm1114:

[rossshow]

Ummm? Foot in the door, maybe?

[Toy Ranch]

Well Kailin, on the surface, it means that if Alibaba makes money, Yahoo's investment increases in value.

But beyond that, it gives their 'brand' a bigger reach into Asia. How exactly that works out is in the details of the transaction. It's not *just* a purchase of a portion of the company, it's also a partnership of sorts. Exactly what sort, we'll find out going forward.

[kailin]

Foot in the door? If only.

I'll never forget an ex-Hungarian refugee friend of mine who was a business writer. His comment after a couple of years in Taiwan was that the Chinese are the most xenophobic people in the world.

Been doing marketing research in China since 1990. GE doesn't sell air conditioners and refrigerators in China. Hai-er sells air conditioners in Walmart.

Is that because Hai-er is superior, technologically, or in quality? Do you have any idea what all the "deals" are that have to be made before a foreign company can set up even a manufacturing facility inside China? Do you really think that there is true capitalism there? (whatever "true" capitalism is )

Nope---consumers there consistently told us the USA products were better. They also consistently said they'd only buy the most locally made products, or perhaps, the Shanghai brands. Why, do you suppose?

It's only a matter of time. I suppose it's a good sign that people studying Mandarin in the USA is up 25% since a couple decades ago. As the Chinese say, the US is No. 1 so has only one direction to go.

Oh, and here's something else to think about. There are 118 point something boys to 100 girls in the marriageable age range in China. When you have a surplus of young men, what do you do with 'em? Don't hardly see a corresponding increase in enrollment in Shaolin temples.


:1neko:

Oh, btw, Ross, is it true, do you know, that these manekineko are used by various Japan underworld groups (dang, can't remember the term -- oh yeah --) yakuza to indicate which fish-houses and sushi bars, etc, they are "protecting?" Different styles for different yakuza?

[Emily]

Ooooh - Kailin you are so right. I read "Bare Branches - The Security Implications of Asia's Surplus Male Population" this summer...fascinating stuff!

From this Amazon description: (http://www.amazon.com/exec/obidos/tg/detail/-/0262083256/qid=1127485010/sr=8-2/ref=pd_bbs_2/002-1578112-9978467?v=glance&s=books&n=507846)
Book Description
What happens to a society that has too many men? In this provocative book, Valerie Hudson and Andrea den Boer argue that, historically, high male-to-female ratios often trigger domestic and international violence. Most violent crime is committed by young unmarried males who lack stable social bonds. Although there is not always a direct cause-and-effect relationship, these surplus men often play a crucial role in making violence prevalent within society. Governments sometimes respond to this problem by enlisting young surplus males in military campaigns and high-risk public works projects. Countries with high male-to-female ratios also tend to develop authoritarian political systems.

Hudson and den Boer suggest that the sex ratios of many Asian countries, particularly China and India -- which represent almost 40 percent of the world's population -- are being skewed in favor of males on a scale that may be unprecedented in human history. Through offspring sex selection (often in the form of sex-selective abortion and female infanticide), these countries are acquiring a disproportionate number of low-status young adult males, called "bare branches" by the Chinese.

Hudson and den Boer argue that this surplus male population in Asia's largest countries threatens domestic stability and international security. The prospects for peace and democracy are dimmed by the growth of bare branches in China and India, and, they maintain, the sex ratios of these countries will have global implications in the twenty-first century.

And then there is the H5N1 virus (bird flu)...scary stuff!

And the whole ebay market obsession...weird stuff!

Asia, and China in particular, is definitely a place to keep up-to date and informed about!

[rossshow]

Naw. No Yakuza connection. Different colors and types just mean different things... Different types of "luck".

http://metropolis.japantoday.com/biginjapanarchive249/245/biginjapaninc.htm

[rossshow]

"EBay CEO: Major Marketing Push Planned For China In 4Q," (Dow Jones Newswires) Morningstar, 10/19/05
http://digbig.com/4fbpt




EBay CEO: Major Marketing Push Planned For China In 4Q
EBay Inc. (EBAY) plans to launch a marketing blitz in China in the fourth quarter, as the online auction giant seeks to make inroads in the fast-growing and highly competitive Chinese market.

Speaking after the release of the company's third-quarter earnings statement Wednesday, eBay President and Chief Executive Meg Whitman said a "major marketing push" is in the works in China as the holiday season approaches. She said that new eBay commercials will go live in China in seven days.

EBay has expanded its investments in China to tap into an online market that is second only to the U.S. in size. The San Jose, Calif., company recently launched its PayPal payments service in China, which is estimated to have about 100 million Internet users.

The company's chief financial officer, Rajiv Dutta, said Wednesday in an interview that eBay added 2 million new users in China in the third quarter, bringing the total number of eBay users in the Asian country to 15.1 million. Worldwide, eBay had 168.1 million registered users at the end of the third quarter, 68 million of whom were considered "active" users.

EBay claims it is the largest online auctioneer in China, but it faces an increasing amount of local competition. In August, Alibaba.com, China's largest e-commerce company, acquired control of the Chinese operations of Yahoo Inc. ( YHOO).

Whitman said Wednesday that the combination of eBay's business units - including PayPal, the Kijiji international classifieds group and newly acquired Internet communications group Skype - open up opportunities for eBay in China. She noted that China is one of Skype's strongest markets.

EBay announced it would acquire Skype in September, and closed on the purchase last Friday. Skype software allows users to communicate free of charge over the Internet, and eBay hopes that its integration will help facilitate transactions and give the company a big presence in the growing online communications market.

Now that Skype has been added to the mix, Whitman said there are "very interesting integration points in China" for eBay, and advised that people "stay tuned for more details" on the company's plans for China.

EBay's international auction business generates nearly as much revenue as the U.S. segment does, and China is a big part of eBay's growth plans.

The company said Wednesday that it generated $408.9 million in its international marketplace business, up 43% from the like period a year ago. The U.S. marketplace business had $449.5 million in revenue, up 29% from the year earlier.

Overall, including revenue from its payment services, eBay generated record revenues of $1.106 billion, helping the company post a net profit of $225 million, or 18 cents a share, in the third quarter.

[rossshow]

http://www.ebusinessforum.com/index.asp?layout=rich_story&channelid=4&categoryid=30&title=A+classified+future+for+eBay+in+China&doc_id=7757

A classified future for eBay in China

FROM THE ECONOMIST INTELLIGENCE UNIT

In a country with no tradition of classified advertising, eBay sees a bright future for an online version of it

Already a multi-billion-dollar industry in the US, Internet classified advertising has arrived in China, courtesy of online-auction giant eBay. But China has no history of classifieds, online or offline. So it begs the question: can online classifieds in China make money? According to the people behind Kijiji.com, eBay’s entry into the international online-classifieds market, the answer is yes—easily. How do they plan to pull it off? By taking their online operation offline.

In August 2004 eBay purchased a 25% stake in San Francisco-based online classifieds pioneer Craigslist.com for a reported US$10m-12m. Six months later, eBay launched Kijiji (it means “village” in Swahili), a mostly non-English network of Craigslist-inspired community websites where people advertise jobs, apartments, goods, activities and services for free. After a series of acquisitions, Kijiji now has websites covering more than 150 cities in 20 countries. And Kijiji China, launched in February with the other Kijiji sites around the world, is leading the pack with more than 80,000 postings at any given time.

China’s huge population obviously provides Kijiji with a solid base from which to grow. Even with very low Internet penetration, the number of Chinese going online is estimated to be more than 100m, second only to the US. But China’s low labour costs allow Kijiji to try things there that it would think twice about in other parts of the world, especially when the operation has little or no revenue.

For example, in May Kijiji China opened a Shanghai call centre where its employees take classified-advertisement information from phone calls, mobile-phone text messages and online instant messages. While Kijiji China would not reveal how many employees the call centre has, it is safe to assume that the company, which has seven full-time administrative staffers, already has or will soon have more workers than the entire 175-site Craigslist network. Craigslist, with 18 employees and very little overhead, has an estimated annual revenue of US$10m-20m.

Kijiji’s China director has a much bigger venture in mind, however. Wang Jianshuo, 28, envisions a workforce of several hundred in the not-too-distant future. The former Microsoft employee whom eBay tracked down through his popular English-language blog, says he wants to grow Kijiji China as a start-up company. “I want Kijiji to be a household brand instead of an online brand,” says Mr Wang.

Kijiji China currently has localised sites covering 30 cities, although most of the traffic during the first seven months of its existence was generated in Shanghai, Beijing and Guangzhou, where the company focused its marketing push. In Shanghai, full-page ads on Kijiji—also featuring a big selection of its own online classifieds—appear twice a week in the free newspaper distributed to the city’s subway commuters. They carry information about how readers can post their own advertisements on Kijiji’s websites. Such bridges to the offline community are crucial components in Mr Wang’s plans to grow Kijiji in China’s second- and third-tier cities. He sees a day when there will be neighbourhood “Kijiji stations”, where people can go both to place classified listings and to pick up a paper version of the online Kijiji ads.

Megaphones and cowbells

Of course, this is all assuming the typical Chinese small-city dweller takes to the foreign idea of placing and answering classified ads. China is still largely a country where things are used until they can be used no more and then sold for scrap value to the “garbage collector”, who rides his bicycle through neighbourhoods with a megaphone and a cowbell. Many day workers, too, do not have access to computers, and usually announce their availability to the public by pasting or painting their phone numbers on city walls.

For his part, Mr Wang says Kijiji’s market research has shown that there is demand for both offline and online classifieds in China. But the question remains: will the Chinese pay for something that they can now do for free? Mr Wang is confident they will, saying some Kijiji China users have already asked if they could pay in order to get better placement for their ads. Mr Wang’s answer to them is “eventually”, but he does not want to monetise the sites too soon. The core service of Kijiji—a basic online classified ad—will always be free, he says. When the time is ripe, however, the company plans to charge users for such value-added features as preferred placement or guaranteed inclusion in Kijiji China’s newspaper section. Kijiji China could charge customers who place ads over the phone, as well.

As with many online ventures, Mr Wang’s ideas will be worthless until they are proven in practice. But most analysts agree that Kijiji China’s potential upside greatly outweighs any financial risks eBay is taking on with the project. The investment needed to launch and maintain Kijiji sites around the world is minor for a company of eBay’s size (it has a market capitalisation of some US$53bn). If it follows the Craigslist model of providing a quality service, generating substantial traffic and then monetising certain aspects of the sites, profits could be substantial. Nowhere is this truer than in China, where there is virtually no competition for classified ads, and where some analysts expect the Internet population to almost double in the next two years—or sooner

[rossshow]

http://www.axcessnews.com/modules/wfsection/article.php?articleid=6591




Recently, China's e-commerce portal, Alibaba, announced that it would pour $1 billion in cash it received from Yahoo! (Nasdaq: YHOO) into Yahoo China and focus its development as a search engine to the Chinese market. But no one took into consideration how that would effect eBay's development of its e-commerce efforts in Asia.

Alibaba's chairman, Ma Yun, said the search engine business underlines a growing desire by Alibaba to build an Internet empire in the Chinese community where it could take advantage of its 9 million users.

While eBay has been working hard on its own Chinese e-commerce business the "brand strength" will not be enough to sway China's consumers to trust an American e-commerce source when they can find the same opportunities in a home-grown business, which Ma is banking on to the tune of $1 billion dollars.

Jason L. Miller a staff writer for WebProNews, in their email newsletter Friday wrote that "eBay Says You Should Wise Up". Miller was lauding the feature eBay launched where "buyers and sellers access to listing, bidding, and pricing trends in the marketplace to help them make more informed selling and buying decisions."

While the feature is noteworthy, it's of little value outside the United States as consumers in China are not very anxious to buy used merchandise from Americans online - though they'll sell them babies.

While no arrests were made, the Chinese news agency Interfax, reported two weeks ago that a baby had been put up for auction on eBay china.

eBay (China) PR Manager Tang Lei said, "We have removed the posting and frozen the account of the person who set up the auction, and already given all relevant information to the Shanghai police."

The online auction for babies was posted on October 16 by a newly registered eBay Eachnet user with the user name "Forever Innovator." All babies offered for sale were younger than 100 days and from central China's Henan Province, one of the country's poorer regions. Baby boys were being sold at a minimum of RMB 28,000 (USD 3,469.64), while baby girls were being sold at a minimum of RMB 13,000 (USD 1610.90)

The posting had registered 50 page views before eBay officials erased it from the website.

"We regularly monitor all of the products posted on our website and we filter out inappropriate words used in postings," Tang said.

However, because 'baby' is not a word that eBay Eachnet filters for, the company was not able to quickly find the auction for babies, Tang said.

Under China's Criminal Law, the abduction and subsequent sale of women and children carries a prison sentence of between 5 and 10 years. However, individuals who abduct children with the specific intent of selling the children can be sentenced to life imprisonment and even death.

"We will cooperate fully with the police," Tang said.

The point of relating the eBay "baby for sale" story is that this would never have happened on Alibaba due to its pure China management rather than half-U.S.-based influences and operating practices.

While Tank said eBay was cooperating with police what he didn't relate was the police may be looking at eBay for its role in the babies for sale scheme.

In the U.S. too, eBay was under investigation by several state securities regulators for its practice of using a mutual fund approach to depositing funds from sales that were to be credited and paid to customers. While no formal securities charges came of the probe, eBay corporate never disclosed it was under investigation either.

If Alibaba's Ma is successful, eBay China could follow in the footsteps of Yahoo and a sale of its business there could be in the making. Perhaps not with Alibaba, though a bid from Baidu.com (Nasdaq: BIDU), which controls 37% of the market, could be a possibility.

Baidu did not return calls over a bid on eBay China and in America, eBay's not talking.

Shares of eBay closed at $43.89, up 58 cents, or 1.3 percent. Baidu.com closed at $70.05, down 38 cents. Yahoo closed at $38.49, down 20 cents.

[kailin]

In my experience living in Hong Kong and reading English language reporting on China, the 2 consistently best sources were The Economist and the Asian Wall St. Journal.

Your quote from the Economist pretty much makes the point I'd make -- the culture, including the economic dynamic, is different in China.

:1clap5:

Wish I'd finished my book about it -- sigh, well, maybe someday I'll have the leisure to do that.

Here's a hint if you want to sell to Chinese -- sell 'em "vintage" stuff that you want them to copy and sell back to the USA (they do great quilts, for example)

:1angelica

[rossshow]

Kailin! Thanks for your comments. I always look forward to your "take" on Ebay in Asia....


MEANWHILE:

http://today.reuters.com/news/newsArticle.aspx?type=internetNews&storyID=2005-11-16T070819Z_01_RID625644_RTRUKOC_0_US-EBAY-KOREA.xml


PUSAN, South Korea (Reuters) - eBay Inc. will set up its Asian headquarters in South Korea, its fourth-largest market, from January to spearhead a drive into its fastest-growing region, executives said on Wednesday.

The decade-old U.S. online auction giant, whose 168 million global users buy and sell everything from classic cars to farm gear, picked the Web-crazed country because it yields over three-quarters of eBay's Asian revenue and sits between two other crucial regional markets: China and Japan.

"We feel we are at just the beginning of what could be an enormous business for us," Chief Executive Meg Whitman told reporters on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in the port city of Pusan.

Asia provides about a third of eBay's non-U.S. users and a third of its international gross merchandise value, or the value of goods bought and sold outside the United States, executives said. "We expect that to continue to grow," Whitman added.

Ten years after the auction site was founded by a Silicon Valley programmer, growth at eBay continues to rocket as it expands beyond auctions into shopping, property rental and, with its $4 billion purchase of Skype, Web-based phone calling.

The California-based firm has set its sights on expanding in Asia, where it already has 30 million users. eBay racked up $1.1 billion in revenue in the third quarter, of which nearly half came from Asia.

The firm launched its PayPal online payments system in China in July, and is spending $100 million there in its largest investment in a single country in 2005.

Though it has signed up about 15 million users in the world's seventh-largest economy -- 1 million more than in South Korea -- the Chinese business still pales against that of Korea, which generates 77 percent of eBay's Asian revenue, executives told Reuters.

And competition is getting tougher.

Both Yahoo Inc. and Google Inc. have invested in or bought Internet firms in China, some of them auction sites.

Over 30 percent of South Koreans have an eBay Auction Co. account, executives have said, and e-commerce there is expected to double to 19 trillion won by 2010.

Whitman declined to forecast growth for Asian markets. But executives have said transaction volume was expected to jump more than 30 percent in China this year.

"The geographical location is just perfect for us," Whitman said.

[rossshow]

http://evilebayempire.blogspot.com/2005/11/alibabacom-claims-victory-over-ebay.html

http://www.forbes.com/markets/feeds/afx/2005/11/17/afx2342483.html


Alibaba.com claims victory over Ebay and vows to beat Google
A brazen Jack Ma of Chinese internet company Alibaba.com claimed victory over Ebay and vows to beat another nemesis: Google. If Mr. Ma's Ebay claims are true, Meg's gonna have to get busy. Guess that means that fees on Ebay's US site will go up even more in 2006 to fund the Chinese battle.

China Internet firm Alibaba.com vows to beat Google
11.17.2005, 02:33 AM
BUSAN, South Korea (AFX) - Chinese Internet firm Alibaba.com hasvowed to defeat US giant Google Inc in the battle to become the dominantsearch engine for the potentially lucrative Chinese market. Alibaba.com chief executive Jack Ma said his company was the undisputed king of the web in China after seeing off e-Bay and taking over Yahoo! Inc's Chinese operations in an August deal that secured one bln usd of investment.
Agence France-Presse cited Ma as saying Google was vulnerable in Chinaand that Alibaba would focus on building up its search engine to keep it out. Speaking to reporters at a meeting of Asia Pacific leaders in the SouthKorean city of Busan, Ma said Alibaba -- through its electronic retail unittaobao.com -- had already defeated e-commerce rival e-Bay.

He said Alibaba was over 20 times bigger than e-Bay and has 11 mlnproduct listings on its website. "The game is almost over, finished. I'm not interested in thatcompetition at all," Ma declared, referring to e-Bay.
"For the search engine, I think Google is very powerful. But it is notthat powerful in China now," said Ma, who founded Alibaba in 1999 with 2,000usd borrowed from relatives. Asked to spell out Alibaba's strategy, Ma said: "We win e-Bay, buy Yahoo!and stop Google. That is for fun. Competition is for fun."

He accepted that Google and Yahoo! were the dominant Internet powers inEurope and the US, but he said neither was that strong in Asia. "I call them sharks in the ocean. We are crocodiles in the Yangtze River.If we fight in the Yangtze River, we have more chances than they have." In August, Yahoo! bought 40 pct of Alibaba for one bln usd and turnedover its Chinese operations to help it grow faster in the Chinese market. The joint venture created a combined entity valued at four bln usd, withaccess to China's more than 100 mln Internet users.

"We will use all the resources we have to focus on search in the next twoto three years in China... We already won (over) e-Bay, we already boughtYahoo! and the money is to stop Google," Ma said. Alibaba plans to expand in South Korea in the next two to three years,and later the Japanese market. While it also plans to boost its presence inEurope, its focus would remain in China and Asia. A public listing for the company may only happen in three to five years,Ma said, adding that any decision on the matter must be taken for very goodreasons. Ma forecast China will become the "number one Internet country" in theworld in five years.

[kailin]

Ma forecast China will become the "number one Internet country" in the world in five years.

That's possible -- except they do have a little bit of a slowdown issue called language, in going global. We are all very lucky that the language of the 'net is still English. Which makes it all the more important to have charge of the Chinese language base. I probably said as much when I first heard about Meg taking eBay to China.

Another factor is that the PLA has been teaching internet to the troops since at least the 1980s -- I remember publishing the English translation of PRC news articles about that when I was editing a little newsletter in Taiwan -- circa 1988-89. The particular item I recall was that one troop which had been designated the best battalion/company? or whatever for 3 years in a row lost their status when they were equipped with PCs for training. They were all surfing and not takin' care of business! :D

Times have changed -- but the PLA as a major business force hasn't.

[kailin]

Oh, and Ross, thanks for the interest -- I'll have more pertinent stuff about this in a couple of weeks -- reporting from closer to the scene ;)

[rossshow]

http://www.forbes.com/2005/11/17/alibaba-ma-google-cx_gl_1117autofacescan05.html

Ma Says China's Alibaba To Thrash Google 'Sharks'
Greg Levine, 11.17.05, 10:28 AM ET

Eric E. Schmidt


NEW YORK - "Sharks" and "crocodiles" populate the brutal playing field envisioned by Jack Ma.

He's the chief executive of Alibaba.com, and the exec relishes the Darwinian battle for China's e-commerce market.

Ma addressed the press at a Pacific Rim leadership conference in South Korea, where the CEO gloried in a supposed victory already won over Meg Whitman's eBay (nasdaq: EBAY - news - people ). Ma maintains that Alibaba, via its Internet retail arm taobao.com, is more than 20 times larger than eBay. Agence France-Presse quoted Ma as dismissing the U.S.-based auction site: "The game is almost over, finished. I'm not interested in [eBay's] competition at all."

As reported in Forbes.com, Alibaba ballooned in power in August, after taking over Yahoo! (nasdaq: YHOO - news - people ) operations in the People's Republic. The Chinese firm inked a deal with the American Web portal, securing a cool billion in Yankee greenbacks.

But Ma isn't content to dominate China's auctions and e-mail. He wants the third point of the Internet triumvirate, too: search. The CEO depicted an almost disarmingly simple strategy: "We win eBay, buy Yahoo! and stop Google. That is for fun. Competition is for fun."

Geography and/or geopolitics apparently loom large in Ma's worldview. He told reporters that while Google (nasdaq: GOOG - news - people ) and Yahoo! dominate Europe and the U.S., neither is in a position to rule Asia.

"I call them sharks in the ocean. We are crocodiles in the Yangtze River. If we fight in the Yangtze River, we have more chances than they have."

Le jeu son fait? Perhaps not yet: Google, led by CEO Eric Schmidt, rose $4.68 Thursday morning to trade at $402.83 on the Nasdaq. And that's for a firm whose $100 starting price was once mocked by skeptics. In the Yangtze or the Hudson, Google still has fangs. More...

[rossshow]

Can't wait to hear on scene reports from our resident Asia Expert, Kailin!

MEANWHILE:

http://news.bbc.co.uk/1/hi/business/4446278.stm

China 'yet to embrace e-commerce'

More Chinese are online but most are not buying anything
Chinese internet users are wary of buying products online, a survey of Chinese internet habits has revealed.

More than 75% of those questioned by the Chinese Academy of Social Sciences said they had never purchased anything online. Only 10% bought regularly.

While internet usage is developing rapidly in China, growth in e-commerce has been much slower.

The survey also found that one-third of internet users do not use e-mail, preferring instant messaging instead.

Young and male

The research - the third survey of Chinese internet use since 2000 - revealed that web users are predominantly male, under 25, well-educated and wealthier than average.

Guo Liang, Chinese Academy of Social Sciences

China now has more than 100 million internet users, making it the second largest internet market after the United States.

The battle for eyeballs has intensified with a host of internet firms - including Google, Yahoo, eBay and domestic portal Baidu - striving to exploit the expanding market.

The Chinese Academy, the government's main think-tank, said that while internet usage had mushroomed, overall penetration was still limited.

Less than 8% of the population have access to the internet while less than 50% of urban dwellers are internet users.

Trust

Many people do not trust the quality of goods bought online

The latest research suggests that most Chinese are not yet comfortable buying goods online.

"Many people do not trust the quality of goods bought online," said Guo Liang, the report's author.

"If they buy it in a store and don't like it, they can easily bring it back."

Most of the 2,300 people questioned in the survey said they used the internet to access news and for online games.

The survey covered internet users in Beijing, Shanghai, Guangzhou, Chengdu and Ghangsha.

[kailin]

:sm1130:

Pleased to add little bit of "what is said" from friends here -- not much expert -- chatboard host much too kind!

According to my friends who watch these things (well, at least one of 'em, an American working in translation because he's very fluent in Mandarin) -- the hot issue is Google. Because, PRC Govt wants Chinese control of Chinese search engines, for reasons such as:

Search for "democracy" -- expect rapid visit to your domicile from special Chinese version "Homeland Security" police force.

Here's the interesting part -- in China, Google works -- but, the PTB don't allow it to use cache! Think about it -- how much good is a search engine without cache?

Major government-imposed stumbling block. So, Mr. Ma has a very good chance to win over Google -- provided he cultivates the proper cronies carefully.

There's no way the PRC gov't will allow foreigners to control the 'net inside China. There are still ways to get outside but their version of "Homeland Security" has a lot of years of experience.


As for that last ^^^ "survey" -- seems they left off a MAJOR (according to several round-eyes who live in PRC) use of the net in China -- "dating" and child molestation. It's a whole lot worse than in either USA or AU, apparently. Young urban dwellers tend to be lonely and isolated, many never had siblings, of course. Lots of "let's get together" after a late night session online (very cheap entertainment) that goes bad.

[kailin]

Oh, one other thing -- can't edit so adding another post -- biggest

:irollers3

of the Bush visit was the picture of Pres and Mrs carrying Bibles and prayer books and going to church, in BEIJING!

Chinese official comment???

Something like -- we understand that Mr. Bush's target audience is not in China! :D

[nancam]

Interesting developments - thanks Ross and Kailin!

Kailin, re: "in China, Google works -- but, the PTB don't allow it to use cache! "

Is that a censorship issue? If something managed to get past the censors (or however they do it) they don't want it viewable from "yesterday" when it was still available?

Also, I'm in total agreement with the 'China don't buy much' theory. Overall, they SELL, right? Would Meg be trying to court China because of the possible goldmine of sellers? If so, this doesen't bode well for Mom&Pop.

[kailin]

Yes, Nan, it's a censorship issue - censorship is the key tool of the PTB in China. When SARS was going on, the PTB were denying and stonewalling, but many many people were getting told about SARS via cellphone text messaging. It didn't take very long for China to obtain/develop/put into place a special software method for monitoring cellphone text messages. Now in full force.

But with the Google thing, it's also now been defined as a "face" issue -- which deflects the story (aka spin) away from censorship and to "China should have a completely Chinese search engine" -- from censorship to challenging the primacy of English as the major language of the 'net.

I think that's just the packaging, though. The real issue is maintaining control of the information flow -- that's the least costly way to maintain order and preserve the unity of such a huge population without a tradition of common law.

[rossshow]

http://www.marketwatch.com/news/story.asp?guid=%7BB7BD7459-493A-473F-A445-FFAA98E36B25%7D&siteid=google

Alibaba on a mission
Commentary: Taking on eBay, online gamers woes worsen, more

By Sage Brennan
Last Update: 7:30 PM ET Dec. 4, 2005


SHANGHAI (MarketWatch) -- Consumer-to-consumer e-commerce company Alibaba, of which Yahoo Inc assumed 40% ownership in August, will continue to consolidate control of YahooChina's search, portal and other assets in the coming weeks.







Alibaba is also focusing on expanding the market share of its core e-commerce business, anchored by the popular Taobao auction site.

Taobao does not currently charge customers to list or buy items through its e-commerce platform, while its primary competitor, eBay's eBay Eachnet unit charges fees to users. Taobao has taken advantage of its fee-free status, attacking eBay's previously unassailable market share. Insiders assert that a surprising portion of eBay users, in fact, frequently complete e-commerce transactions using Taobao and its associated e-payment platform AliPay after initially locating products for sale on eBay.

Gearing up for a battle

This substantial bonus for Taobao is likely to fade as eBay's long and somewhat tortured integration of Eachnet begins to show fruit in areas such as website usability, marketing sophistication and strategic execution. Taobao's Alibaba, meanwhile, is still adjusting to a new suit of second-hand clothes. Alibaba has reportedly established a substantial in-house research and development group to guide technology creation and application, which presumably will focus on usability and search tools in the short term, with an eye to chip away at eBay's technological advantage.



There are many potentially profitable directions in which YahooChina's new masters can take the group, and several valuable properties that it can leverage for growth: business-to-business e-commerce powerhouse Alibaba, the recently face-lifted Yahoo.cn portal, a bolstered search capability and the rapidly growing Taobao, which has developed into a powerful brand for Alibaba and a solid base for future growth, but at a substantial cost.

Under the watchful attention of Yahoo , Alibaba will surely be forced --- at some point -- to better monetize Taobao's huge user base, although management will try to find creative ways to avoid directly charging users for services.

News last week that Yahoo will apparently replace Google Inc as the built-in search capability in Asian editions of Mozilla's Firefox browser is a strong indication that Alibaba and Yahoo plan to set their newly-joined heels in the struggle against Google in China. Although substantially behind both Google and Baidu.com Inc in China's search landscape, Yahoo is clearly gearing up for what promises to be a nasty battle.

Ultimately, conventional wisdom in China suggests that the eBay/Eachnet versus Alibaba/Taobao battle will be guided by company missions that mingle like oil and water: Taobao seems driven to conquer and destroy eBay in spectacular and dramatic fashion, while eBay's California-influenced management appears almost altruistic in its desire to surpass all other players on the strength of its technology and marketing prowess.

Alibaba may soon catch up to eBay on the technology front, while eBay will begin to nip more persistently at Alibaba as it executes a more effective, China-focused marketing and merchandising strategy. This classic contrast in strategic vision will make for an exciting contest between the two e-commerce leaders.

Alibaba CEO Jack Ma's assertion last week that YahooChina does not plan to give up its portal business seems somewhat at odds with the recent drastic simplification of Yahoo's China homepage, but insiders indicate that the unexpected change is simply an early move in a broader strategic realignment of the company. Only the proverbial forty thieves can tell where Alibaba plans to spend its substantial war chest, but look for acquisitions or new products in areas near the intersection of e-commerce and search, such as online games, digital music and social networking.

[rossshow]

http://www.otwa.com/community/showthread.php?t=37669

http://news.yahoo.com/s/afp/20060120/tc_afp/chinausinternetebay

The US online auction service eBay scrapped all sellers' transaction fees in China, in an effort to compete with local competitors offering free services, including Yahoo-invested Alibaba.com.



The online auctioneer announced the changes on its China auction website, saying transaction fees would be waived, but small fees would continue to be charged for listing products on the site's webspace and for "feature" products.

eBay's China unit, Eachnet, would also require all sellers to provide authorized online payment mechanisms to improve its credit environment, including PayPal and other escrow services, the announcement said.

The move means that sellers won't get paid until the buyers receive and are satisfied with the products, it said.

The fee cut matches the free services that have been offered by Alibaba's online auctioneer Taobao, and highlights the stiff competition the US company faces in China.

The US-based Internet company Yahoo last year invested 1.0 billion dollars into Alibaba, while eBay bought out the Shanghai-based Eachnet for 180 million dollars in a series of transactions ending in 2004.

According to the Shanghai Daily, eBay Eachnet had 17.9 million users at the end of the fourth quarter of 2005, compared with Taobao's 13.9 million users.

However, Taobao saw an increase of 3.85 million new users between September and the end of the year, while eBay Eachnet only registered 2.8 million new users during the quarter.

Taobao.com said Thursday its online transaction value reached 8.02 billion yuan (1 billion dollars) last year, seven times the previous year's level, according to the paper.

Taobao had nearly one million online cyber stores compared with 10,000 cyber stores registered on eBay Eachnet, the Shanghai Daily reported last month.

In 2005, eBay's international net profit reached 1.08 billion dollars, 39 percent growth year-on-year, but it was unclear how much of that came from China.

[rossshow]

TWO related stories, today:


"Yahoo! China Makes An Abrupt Turn," TMCnet, 4/5/06
http://www.tmcnet.com/usubmit/2006/04/05/1541305.htm (http://www.tmcnet.com/usubmit/2006/04/05/1541305.htm)


Highly squeezed by Baidu.com and Google.com, Yahoo! China today readjusted its Chinese search service by casting away the "one-search-frame model" that takes the page from Google's playbook.

Tian Jian, executive general manager of Yahoo! China, says that the old version is lack of interactivity in the Web 2.0 era and it may be suitable for Internet users in the west, but Chinese.

Yahoo! China simplified its main page in November 2005. But merely six months later, it returned to its old style by reading channels of latest news, music, photo, community, and so on.

In early this year, Yahoo! China integrated contents, communities, instant messaging, free email, and personal websites into one platform in a bid to provide one-stop experience to its users.

The reversion is just part of its long-term strategy. Next, Yahoo! China will come up with a long list of new services such as traveling search, shopping search, and even entertainment search.

At the latest, Yahoo! China will formally launch its shopping search service, which will cover not only Taobao.com, Alibaba.com, but also eBayeachnet.com, Dangdang, and Joyo.

The front page of Yahoo.cn has more functions and links to news buried deep within the site. It looks more like its American counterpart at Yahoo.com and less like its previous incarnation that looked like Google's homepage.

Tian Jian explains that unlike their American counterparts, Chinese netizens prefer lots of content to be included on the website.

Mao Xin, director the Website Operation Department of Yahoo! China, has told local media that the company will launch three vertical search features focusing on information, entertainment and life in the coming weeks.

Analysts quoted in local media say that Yahoo! China is undergoing these changes to gain back users it has lost as a result of its last appearance shift after being acquired by Alibaba.com.

Alibaba.com shifted Yahoo! China, which it acquired in October last year, from a portal to a search engine. The completion of the shift is one month ahead of the schedule of Jack Ma, chief executive officer of Alibaba.com, according to insiders.

Yahoo! China has undergone tremendous changes in shifting the core business into search in the past five months. To achieve the object, it carried out a series of moves, including the stabilization of management structure, recruitment of search talents, rearrangement of the original services and contents, renovation of some of the original brands, adjustment of the organization framework of 3721 channels nationwide, reshuffling business modules of emails and instant communications, and debut of some new brands, such as Yahoo! Assistant, Alibaba.com Internet Real Name, and ks.cn.yahoo.com.

The moves are based on the deep understanding of Alibaba.com and Yahoo! China, and this is also the very reason why there are no big personnel changes to the two companies in the process of integration, insiders noted.

Clear strategy is of great importance to the final success, and this is especially true for Yahoo! China. In terms of new strategy, Yahoo! China has completed the integration successfully in the past five months, which is considered a long shot in the industry. In addition, some new information is concluded and put forward in the process. For example, Yahoo! China will debut the new brand slogan in a high profile, The first Living Brand in China, according to Tian Jian.




"Jack Ma: Alibaba Revenues To Hit 10B Yuan In 2009," Posted by Cheng Jia on Pacific Epoch, 3/29/06
http://www.pacificepoch.com/newsstories?id=57883_0_5_0_M (http://www.pacificepoch.com/newsstories?id=57883_0_5_0_M)


Chinese e-commerce company Alibaba's revenues will reach ten billion Yuan in three years, reports China Economic Times quoting Alibaba CEO Jack Ma. Ma said that Alibaba and Yahoo China's [entire value chain] will provide job opportunities for one million people and that the company's distribution partners will generate ten billion Yuan in revenues in three years. Alibaba vice president Deng Kangming said that Alibaba and Yahoo China will support its distribution partners through training, differentiated services, promotions and improvements in operations.