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Taobao and Yahoo Japan announce tie-up
Published on: 2010-05-11
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Taobao, China’s leading retail e-commerce company, on Monday unveiled an alliance with Yahoo Japan Shopping, as the Alibaba unit moves to internationalise its business.

Yahoo Japan Shopping will offer 50m Chinese product listings introduced by Taobao to Japanese consumers from June 1, while TaoJapan will carry 8m Japanese listings for Chinese consumers. Alibaba, Taobao’s parent company, operates the world’s largest business-to-business online marketplace.

The move highlights how Asian internet companies are increasingly seeking cross-border tie-ups in the region as they look for growth overseas. Rakuten, the largest Japanese e-commerce company, recently said it would extend its export service for Japanese merchants to let users of its Taiwanese site sell back into Japan.

Both Alibaba and Yahoo Japan have links to Softbank, the Japanese telecoms giant. Softbank is one of Alibaba’s investors and is also Yahoo Japan’s largest shareholder with a 41 per cent stake, according to its last annual report. Softbank’s report also showed it held 3.8 per cent of Yahoo Inc as of last year.

Masayoshi Son, Softbank chief executive, said that as internet populations in Asia were growing faster than those in the west, Asia had replaced the US as the key market for internet companies to becoming global leaders.

But Mr Son said he was not interested in pushing this point by fighting for stronger control of Yahoo globally.

“Yahoo in the US have to decide on their own fate. It is our policy not to have 100 per cent subsidiaries,” he said. “We’d rather partner with someone like Alibaba.”

The new tie-up will see Japanese consumers shopping on the Yahoo Japan in a new section called ‘China Mall’. Taobao will provide the link for the suppliers, and other Alibaba units will power payment settlement, transport, customs and other cross-border services.

Jack Ma, Alibaba group chief executive, said partnerships could prove more useful to Taobao than an attempt to enter foreign markets on its own.

“I don’t share the American idea of going everywhere on your own, of building an empire,” he told the Financial Times.

Mr Ma has shown similar pragmatism with Alibaba’s cross-border payments. The company recently said it would co-operate with PayPal, the online payment platform owned by Ebay, instead of going for AliPay, its own platform, when it started offering on-site cross-border transactions for the first time.

Mr Ma said the Japan alliance would help Taobao thoroughly learn the ropes of cross-border e-commerce business, and he expected the company to target the next overseas market in about 24 months.

The Alibaba boss did not exclude the possibility of teaming up with Ebay in a similar way in the US market in the future.

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