Those close to me know of my interests in China and the changing Chinese economy. One of the major factors involved with this are the massive, innovative Chinese tech companies, such as Baidu, Tencent, and
Alibaba.
In this post, I’d like to give a brief overview of what Alibaba is for interested readers.
Let’s start with the history of Alibaba and its founder. As many know, Jack Ma has a pretty interesting (and inspirational) backstory. Jack was born in 1964 in the Zhejiang Province on the Eastern Coast of China. It took him 4 times to pass the Chinese college entrance exams. He was focused on getting into a top university, but was rejected from Harvard 10 times. Later he was rejected from 30 jobs, including a job at a KFC.
Introduced to the internet first in 1995 when visiting the US, Jack realized that there were no websites back in China. He quickly understood just how big the potential of the internet was.
In 1999, Jack founded what would become a legendary company, Alibaba. It took only 2 years for Alibaba to become profitable. In 2005, it took over the operation of Yahoo China.
So what is Alibaba? Similar to the major
tech companies in the United States, Alibaba is a multi-faceted venture. The company owns a large variety of site types — its largest site is
Taobao, a peer-to-peer marketplace, similar to eBay or OfferUp, but without bidding. It also has a cloud-computing service, a mobile-payment service (known as Alipay), and a recently purchased video service which is known as the Youtube of China. Some in the US would say it’s a bit of a mix between Amazon and Google.
When being talked about in the western technology press, Alibaba is most commonly compared to Amazon. However, there is no true equivalent of Alibaba in the United States.
So let’s take a few moments to throw out a few facts to compare these two giants.
For full disclosure, I must note here that I am currently employed by Amazon and any views stated are my own.
According to ParcelHero, Amazon is only responsible for 3 million packages a day, a fraction of Alibaba’s reported 12 million a day. In terms of 2016 revenue, Amazon was at $136B while Alibaba followed at $101B.
Alibaba has a myriad of interesting products and features coming down the pipeline in the near-future. Mentioned before, the company very recently, bought out Youku Tudou, the Youtube of China for about $3.5B. The company has also been venturing into the realm of Virtual Reality. Its Virtual Reality shopping experience, dubbed Buy+, was first showcased in late 2016.
Alibaba is also working on a logistics and delivering network, like FedEx, called China Smart Logistics Network. The goal is 1-day delivery for all of the major cities in China
Alibaba still has plenty of room to grow and develop, especially in an economically growing China. I’ll be following them closely in these next few years.
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