Alibaba

[CityFarmer]

Is alibaba market share of ecommerce for real? If it is, its just too big to be able to grow further? If its false how much will the share drop? If competition gets worse in China, where is the data to support growth.

I think Alibaba market maker at some stage will stop supporting the share and it will definitely be at the mercy of its own making. I also think Alibaba is a very successful business because of its linkage to China government. My guess is that it will be dump once Western skeptics start to question the nos!!

WSJ said Alibaba is looking to grow in Western country, that itself is a red flag!

The post is more relevant in Alibaba thread, so I merged it here.

Regards
Moderator

[greengiraffe]

Can Alibaba keep growing without sacrificing high profit margins?
DOW JONES SEPTEMBER 22, 2014 11:00AM

Through its successful U.S. listing, Chinese e-commerce company Alibaba Group became one of the most valuable technology enterprises in the world.

But the real success of Alibaba's initial public offering will depend on whether it can keep growing without sacrificing its high profit margins of more than 40 per cent. That means deftly shifting its business model to mobile while fending off stiff competition from Chinese rivals.

Alibaba's shares rose 38 per cent in their trading debut Friday on the New York Stock Exchange, giving the company a market value of US$231 billion, higher than Facebook and Amazon.com. The steep valuation reflects high expectations that Alibaba, which raised US$21.8 billion in its IPO to set a U.S. record, will continue to see strong earnings growth amid a rise in China's middle class.

"Expectations are very high," said Peter Luo, an associate portfolio manager at RS Investments, which bought shares in the IPO. "Now Alibaba has to deliver the growth and meet the expectations."

Hangzhou-based Alibaba's profit margins are already among the highest in the industry. The company doesn't sell products itself like Amazon does. It earns a chunk of its revenue by charging merchants for advertisements on its Taobao and Tmall shopping sites. Thanks to a combination of ads and commission fees, Alibaba is more profitable than its U.S. competitors. In the second quarter, Alibaba's operating margin was 43.4 per cent, much higher than eBay's 18 per cent and Google's 27 per cent. Amazon had an operating loss margin of 0.1 per cent.

How to Taobao.


Alibaba's high margins are now under pressure as it spends heavily to adapt its e-commerce platform to mobile apps. There also is intensifying competition from Tencent Holdings, which is stepping on Alibaba's toes by connecting its popular mobile messaging apps with e-commerce services.

Still, Alibaba's shift to mobile is accelerating. Active users for its mobile apps increased to 188 million in June from 136 million in December. About a third of Alibaba's total e-commerce transaction volume of US$81.58 billion in the April-June quarter came through smartphones and tablets, compared with 12 per cent a year ago.

But growth from mobile isn't without challenges. Alibaba conceded in its IPO filings that merchants are paying lower rates for mobile advertising than they are for PC websites, without giving specific figures.

Many merchants who use Alibaba's Taobao and Tmall participate in auctions of search keywords. For example, when a shopper enters a keyword like "wristwatch," part of the search results shows products from merchants who placed the highest bids for the keyword to make their product more visible. Bid prices vary according to how much merchants are willing to pay Alibaba each time a shopper clicks on their products.

Merchants generally pay 3 yuan to 5 yuan (49 cents to 81 cents) a click, said Atsushi Watanabe, a consultant at Shanghai-based T.U. Business Consulting Co., which helps Japanese merchants use Taobao. Apart from search keywords, some merchants also pay for ads that are displayed on the home pages of Taobao and Tmall.

RS Investments' Mr. Luo said he asked Alibaba executives attending the IPO roadshow in Singapore whether its e-commerce business can be as profitable on mobile phones. Mr. Luo said Alibaba senior executives explained that if consumers spend more time using Taobao's mobile app for product searches and shopping, merchants will start placing higher bids for mobile search keywords and mobile ads will become more lucrative.

Alibaba declined to comment.

Analysts say Alibaba is under more pressure because Tencent is connecting its popular smartphone messaging apps, WeChat and Mobile QQ, with e-commerce services. WeChat, with more than 400 million users, and Mobile QQ, with about 500 million, allow people to, for example, purchase movie tickets or book a taxi in addition to online shopping. Both apps are equipped with Tencent's own electronic payment system. Earlier this year, Tencent bought a 15 per cent stake in JD.com, China's second-largest e-commerce company by transactions after Alibaba, and integrated JD's online store into its messaging platforms. Tencent also is recruiting small businesses to sell their products through WeChat.

Marco Ma, an e-commerce manager for Factory Five, a bicycle shop in Shanghai that runs an online store on Taobao, received a phone call last month from an official at Tencent's WeChat messaging app unit who offered to let Factory Five conduct e-commerce through WeChat free of charge.

Inside the online shops.


Factory Five co-founder Drew Bates said "their sales pitch was that WeChat is already an intrinsic part of people's lives, so bolting on an e-commerce platform is just a logical step." He said his company started selling some of its products through WeChat last month, in addition to Taobao.

Tencent approached Factory Five with the offer around the same time the bike shop was redesigning its store on Taobao's mobile app using software tools provided by Alibaba, Mr. Bates said. But so far, Factory Five's Taobao store generates far more sales than its WeChat store, he said.

Data so far show few signs of threat to Alibaba's e-commerce dominance. Taobao's mobile app accounted for 86 per cent of China's online shopping done through smartphones and tablets in the second quarter, according to iResearch.

But Tencent could be a threat in the future if more consumers warm up to the idea of linking social networks with commerce, Jefferies analyst Cynthia Meng said. "If people are spending so much time on WeChat and Mobile QQ, there will be little time left for other apps," she said.

[Behappyalways]

凤凰快讯 马云(阿里巴巴CEO)接受CNBC专访全程飙英文：我心中的英雄是阿甘
http://www.youtube.com/watch?v=CZZkfJHhJCo

[greengiraffe]

Playing field with Chinese is always tilted against non Chinese... its a fact of life that will not change...

Alibaba highlights challenge to US net biz
MCT SEPTEMBER 24, 2014 2:15PM

Overlooked amid the excitement over Alibaba's blockbuster IPO on the New York Stock Exchange last week was one of the reasons for the company's smashing debut: The Chinese market it dominates is all but blocked for Silicon Valley rivals like Google, Facebook and Twitter.

That's no small thing now, and it will be an increasingly important issue in the future.

In China, more than 600 million people are online - double the entire US population - and that's not even half of the country's residents.

And not only is it a huge market, it is a fast-changing one that forces Chinese firms to learn to be innovative and nimble, particularly helpful skills as they move into other emerging markets and go up against the Valley's giants.

US internet companies want to expand in China, but they haven't had much success. Some tech firms, most notably Google, have tussled with the government over censorship. Others have run into antitrust issues or suffered from the weak intellectual property laws in China.

"Alibaba's IPO is a good reminder that among the reasons why US firms haven't succeeded in China is that they are largely barred from doing business there," said Erin Ennis, vice president of the US-China Business Council, an advisory and advocacy group for US companies that do business in China.

To be fair, other companies like eBay simply have been outcompeted.

But all these problems for US companies have allowed firms like Alibaba, as well as Baidu, the Google of China, and Tencent, the social networking firm that owns the popular WeChat messaging service, to establish positions in China as market leaders.

Those companies are "sitting on a somewhat protective home market," said Robert Atkinson, president of the Information Technology and Innovation Foundation.

"Their profits and margins are higher than they would be if they had legitimate marketplace competition. They are using that money to finance their overseas expansion."

And they are now among the most valuable internet companies in the world.

Their rise creates new risks to US internet firms beyond missing out on the Chinese market. US companies must also battle these newly emboldened Chinese internet firms in emerging markets like Africa, the rest of Asia and Latin America. These economies will fuel the next cycle of growth for tech firms as their internet infrastructure develops.

"Alibaba already has substantial international reach and they clearly aspire to more," said Nicholas Lardy, a senior fellow at the Peterson Institute for International Economics.

"It will pose a huge challenge to US-based internet firms."

And it's not just money that is helping the Chinese firms. It's the expertise they are getting in China itself that could help them move into developing countries, said Rebecca Fannin, founder and editor of Silicon Dragon News.

"As Chinese internet firms step up their expansion overseas, they could gain an advantage against US rivals, due to their large base in China, their experience in dealing with the intense challenges of the competitive and increasingly innovative Chinese market," Fannin said.

There are at least two possible scenarios about how this fight among the global internet companies may play out.

In one, China's slowly liberalising economy may open up and become more friendly to US businesses. Already, the US and China are negotiating a treaty on investment in China and that may lead to further steps to give tech firms the opportunity to grow there.

For that reason, some see cause for optimism.

"The experience US firms have had to date is not a harbinger of what it will be in that market," Ennis said.

Of course, with the head start firms like Alibaba already have, it's unclear how well Google and Facebook and the others will fare. But they are already global brands, and access to the rapidly growing Chinese market would give them at least the chance at tremendous opportunities as they run into slowing growth in the developed countries.

In another scenario, US firms continue to find it hard to do business in China. That could significantly limit their options for future growth and, even worse, nothing would prevent Chinese companies from competing with them in wealthy markets like the US. This is clearly the worst case scenario and one that has to have big Valley internet firms worried.

Friday was Alibaba's day to shine. The real question is whether we just saw the start of Alibaba's decade to shine as well.

[greengiraffe]

Alibaba gets OK for private bank in China
AFP SEPTEMBER 29, 2014 6:45PM

Chinese e-commerce giant Alibaba, which completed the world's largest stock offering earlier this month, has received approval to set up a private bank.

The China Banking Regulatory Commission (CBRC) said on Monday that Alibaba would be the majority shareholder with a 30 per cent stake in a private bank to be established in the eastern province of Zhejiang, where the company is headquartered.

Alibaba's ambitions extend beyond e-commerce and it has already sought to shake up state banks with a financial product called Yuebao, an investment fund that offers better returns than traditional deposits.

Other major shareholders in the newly approved bank include units of privately-owned conglomerate Fosun with 25 per cent, auto parts maker Wanxiang Group with 18 per cent and investment firm Yintai with 16 per cent.

Alibaba's listing on the New York Stock Exchange raised a total of $US25 billion ($A27.05 billion), making it the largest stock offer in history and founder Jack Ma the richest person in China, according to the annual rich list of luxury magazine publisher Hurun Report.

Alibaba, estimated to hold more than 90 per cent of the Chinese market for consumer-to-consumer transactions, embarked on an acquisition frenzy before the listing.

On Monday Shenzhen-listed Beijing Shiji Information Technology, which provides IT solutions to the hotel industry, said a subsidiary of Alibaba had signed an agreement to pay 2.81 billion yuan ($A494.45 million) for a 15 per cent stake in the company, according to stock exchange filings.

The banking regulator on Monday also approved a Shanghai-based private bank whose major shareholder will be JuneYao Group, which has businesses ranging from food to aviation.

JuneYao will hold 30 per cent while apparel maker Metersbonwe will take 15 per cent, the CBRC said.

In the past two months the country has approved five private banks including one invested in by internet giant Tencent, parent of China's most popular messaging app WeChat and a rival of Alibaba.

China previously had only two private banks, Minsheng and Ping An.

Apart from the two announced on Monday it approved three in late July, to be based in the southern boom town Shenzhen, the northern port of Tianjin and the eastern city of Wenzhou.

The approvals followed a declaration by the government in March that it would reform the banking sector, which is dominated by four state-owned banks - though all of them have minority shares listed on the stock market.

[greengiraffe]

Alibaba coming up a cloud
OCTOBER 24, 2014 12:45PM

Among the lesser-known arms of Chinese e-commerce giant Alibaba Group Holding is a business called AliCloud, which held a developers’ conference in Alibaba’s home city of Hangzhou on Oct. 17.

AliCloud operates data centers: facilities that house computing equipment such as servers. Companies pay fees to AliCloud to gain access to its data centers and take advantage of its computing resources. The businesses are charged based on how much computing power they consume, much like paying utility bills. Those fees are the main source of revenue for AliCloud, which is a business division of Alibaba.

“We are like the road, and businesses that use our infrastructure are the cars that drive on the road,” said Alibaba Chief Technology Officer Wang Jian, on the sidelines of the conference.

AliCloud is still tiny compared to Alibaba’s giant shopping operations, which run sites like Taobao and Tmall and account for the majority of the company’s revenue.

Wang declined to disclose revenue or earnings figures for AliCloud, and wouldn’t say whether the business is profitable - describing it only as “very sustainable.”

Wang said AliCloud now has about 1,000 employees - a small part of Alibaba’s 20,000-strong work force.

Wang said that AliCloud is not involved in the management and analysis of the masses of data collected by Taobao and Tmall, or Alibaba’s other units - nor are there concrete plans to increase collaboration with AliCloud.

AliCloud also has no access to the data being collected by businesses using its cloud-computing resources, Wang said.

Representatives of some of those businesses were among the 10,000 attendees at the AliCloud conference.

One such business was 12308 Network Technology, which runs an online bus-ticket booking service that gathers information from bus terminals across China to help passengers plan their trips more efficiently.

Other than its data center offerings, AliCloud also develops its own operating systems for data centers, smartphones, smart televisions and other devices.

AliCloud’s smartphone OS, called Yun OS, faced challenges in 2012 when Google didn’t allow personal computer maker Acer to launch a new handset using it because it was “non-compatible” with Google 's Android system. Acer is a member of Android’s open handset alliance, which doesn’t allow members to work with an OS that is only partially compatible with Android.

At the conference Friday, Dutch electronics maker Philips showcased a new smartphone powered by Yun OS.

But Yun OS will likely need a lot more than the new Philips phone to make a breakthrough in the market. Philips is a minor player in smartphones, even though it is known for home appliances.

On Friday, Wang declined to comment on the outlook for Yun OS, saying that the company will hold another event soon to provide updates on the mobile OS business.

[BlueKelah]

wah more commision than ebay will ever get!!

Wonder if all the assets are added up together will it be enough for the state to support the banks when default time comes around..

How Xi Jinping is Helping Jack Ma Sell 41,000 Properties on Taobao
When President Xi Jinping launched his anti-corruption drive last year by declaring war on “tigers and flies” few could have imagined that he was also helping Internet magnate Jack Ma to launch a whole new ecommerce initiative.

Now Ma’s Taobao.com, the consumer ecommerce site belonging to his Alibaba group has developed a new site, sf.taobao.com, entirely devoted to helping China’s courts to liquidate seized assets, many of them the spoils of Xi’s anti-corruption purge. For seekers of distressed real estate assets, the site may become a major avenue for picking up the apartments, offices and other properties taken away from fallen officials.

As of today, sf.taobao.com lists more than 41,000 built assets for sale.
Liquidating Shops, Homes and Even Industrial Parks

Among the items recently sold on the website are a 345 square metre apartment in Wenzhou that fetched RMB 10.7 million. If you feel bad about missing out on that deal, still available are an unfinished retail project in Jiaxing, Zhejiang for RMB 136 million, an industrial facility in Xiamen for RMB 133 million, and even an entire industrial park in Henan for RMB 918 million.

Given the taste that China’s corrupt officials have for real estate, the site also contains 750 plots of land for sale, and 14 infrastructure projects. The site extends beyond real estate, however, and offers more than 6000 seized cars ranging from the usual Audis and Mercedes to heavy trucks.

Read More Here...

[holy grail]

Good money for Taobao and CCP. win win! Hah

[bigfatpillar]

yap! by the way anyone in singpost?

[Bubbachuck]

Anybody knows where to download the latest quarterly report?