Paul Woodward

China's E-Commerce Takes Off

It really isn't correct to suggest that Taoboa has revenues larger than Hualian. They may indeed process transactions which are larger than Hualian's revenues but Taobao's services remain almost completely free and the company generates basically no direct revenues from all this activity. Its users have strongly resisted efforts to introduce fees and the Alibaba management has to continue to try other angles to monetize at least some of this activity.

Is Alibaba’s New Business Initiative a Threat to Global Sources?

I think these are all good points and agree with your overall analysis. A couple of thoughts:

1. Putting aside the potentially dodgy nature of Alexa data (we treat it as the least bad option but still rather unreliable), the comparisons you make assume that Global Sources and Alibaba.com have broadly similar audiences. If Alibaba's claims of a much bigger audience are true, then their 6.6% of users from the USA could potentially equate to a larger number than Global Sources' 18.8% for example.

2. Although your comments on access to exhibition venues are completely correct, Alibaba has, so far, been at pains to suggest that it will not organise its own exhibitions. In doing so, it has been keen to differentiate itself from Global Sources' strategy. Whether this is wise, time will tell.

Paul Woodward: