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2012 International Consumer Electronics Show
Photographer: Andrew Harrer/Bloomberg
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Just how dominant is Alibaba in China’s booming e-commerce market? The homegrown Amazon/EBay mashup accounted for more than three-quarters of the nation’s online retail sales in 2015. There are lots of attention-grabbing internet companies that hope to make money off of trend-hopping teens; Alibaba is building an empire on the spending power of Chinese farmers, laborers and white-collar workers. That could add up: By the end of 2016, some 731 million Chinese were online — more than twice the population of any other country except India. As if that market wasn’t big enough, it’s also casting its eyes overseas and beyond e-commerce with investments in Hollywood movies, a soccer team and news media. 

Alibaba’s growth story has continued since its record $25 billion initial public offering in New York in 2014 and it is now ranked among the world's top 10 companies in terms of market value. An inquiry into Alibaba's accounting methods and the company's return to a U.S. government list of the world's largest destinations for fake goods have wiped off some of the shine, but not so much for investors: Its shares reached a record in 2017, trading at more than two-and-a-half times the IPO price. Facing competition from the likes of Tencent Holdings Ltd. and Baidu Inc., Alibaba is investing heavily in reaching customers through smartphones and tablets, as well as cloud computing and virtual reality. It owns stakes in Southeast Asian e-commerce site Lazada and ride-sharing program Lyft, has its own mobile operating system and is leasing spectrum from state-owned phone companies to offer mobile voice and data packages. It also has a stake in a leading Chinese soccer team, became a top Olympic Games sponsor and bought Hong Kong’s century-old South China Morning Post newspaper. Its investments in Chinese department store operator Intime Retail Group and hypermarket giant Sun Art Retail Group Ltd. were among more than 70 deals worth a combined $29 billion in 2016 and 2017. At the same time, its customer base has spread to countries as diverse as Brazil and Russia. A tussle with the Chinese government over charges of bribery and toleration of counterfeit goods, while quickly patched up, was a reminder of the risks of doing business in a one-party state. And the probe by the U.S. Securities and Exchange Commission has underlined concern over what one analyst called Alibaba’s “unusual” accounting practices.