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December 19, 2006
eBay's China Challenge
Why can't U.S. Web companies make it in China on their own? Assuming the reports are true, it looks like eBay will soon be joining a number of U.S. firms that have offloaded their China Internet investments to local partners. As had been rumored for some time, the new reports have eBay teaming with Tom Online. It would be quite a switch, given that CEO Meg Whitman spent some $100 million last year on the site, only to lose ground to Alibaba, Yahoo's partner in China. (Not that Alibaba is without its troubles, either.) (Update: Corrected story link.)
What happened? There are some interesting (if unconfirmed) little hints at this Chinese blog. The gist clearly is that eBay didn't understand the market in China, despite buying a Chinese company and trying a number of strategies. Whatever the reason, this can't be a great development for eBay. Given CEO Meg Whitman's evident determination that last couple of years to make a go of it in China--coupled with eBay's exit from Japan years ago and its challenges in Korea--this has to be a bitter pill to swallow. And with China's Internet population set to exceed the United States' before long, it's a setback for eBay's long-term growth potential.
Update: Done deal.
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? Why Is China So Hard For American Companies? from Hitchhiker's Guide to 650
Why can’t U.S. Web companies make it in China on their own?
Rob Hoff asks a good question . . . Here is my thesis and it lies in the tone in this email. The tone is not unique to the writer, it is actually a pervasive part the modern Chinese cu... [Read More]
Tracked on December 20, 2006 07:53 PM
Actually I will take a bit different take. Chinese Internet users do use Google as well — I have observed my co-workers in the office (in our office in Beijing) use Google for English language related searches, article from western publications searches etc. and then they tend to use Baidu for more local news or local article searches. So in a way they are using the best of both worlds. Then of course there are issues with what breaks are put on Google with regard to operations in China. That makes their work a bit tough as well.
Posted by: Nikolay at December 28, 2006 08:08 PM