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How Jack Ma took on eBay with Taobao
- hawflakes 8y agoI wonder if this gets into all the internal politics on the eBay-PayPal side of things...
- ukyrgf 8y agohttps://money.cnn.com/2018/02/01/technology/paypal-ebay-payments-split-adyen/index.html https://money.cnn.com/2018/02/01/technology/paypal-ebay-paym... They've already split off.
- hawflakes 8y agoI was referencing the politics between the two companies at the time they were fighting Alibaba/Taobao/Alipay. I have some firsthand experience on the eBay/PayPal side of things.
- hawflakes 8y agoI worked at PayPal on the China team. There were a lot of internal politics at the time and I know people on both sides of that internal fight. Needless to say, it was a battle that eBayPal wasn't going to win. From slow servers hosted in the US data centers having to traverse the GFW to the massive payment friction compared to Taobao's checkout flow. As for the politics, there were partially policy decisions and partially just a lot of internal infighting. Not to mention the time wasted making PPTs instead of fighting on the ground.
- chaostheory 8y agoWhen the Chinese market is effectively closed to foreign companies once they make any inroads, it's easy to win against ebay or another US company.
- moscovium 8y agoThere's no competition like no competition!
- dqpb 8y ago> Jack told me: “I started looking at the market and realized that, pretty soon, eBay was going to try to get aggressive with its business in China. They’d start with consumers, but over time they will start coming after Alibaba’s wholesalers. Competition was inevitable. So I decided the only way we can slow them down is to launch a site to compete directly with their Chinese language site." That, plus the fact that China will just pull the plug on any American business gaining too much traction.
- slyssassa 8y agoExactly. Sooner or later alibaba is just gonna be another Chinese governments pawn anyways. The government already took over Wanda and hna effortlessly.
- justaman 8y agoI can't imagine a better way to ensure the business suffers in the long term. (coming from an American who see's how poorly run government institutions are)
- metalliqaz 8y agoYes but it some respects you're comparing apples to oranges. The US political system is perpetually focused on the short term because of the ~4 year election cycle. China has a president for life and single-party rule. They are able to make and execute long term plans, which is why they are currently succeeding at reshaping the global trade landscape. (all roads lead to China, and all that) It's not just that the government takes over management of the companies, they also manage the population. Where in the US consumers may choose to avoid an entity being mismanaged by the government, in China they may not exactly have that option.
- influx 8y agoSo if China is long term going to be the end all be all, why are the Chinese elite doing everything in their power to get their cash and kids out of the country?
- Leary 8y agoSeems like Ebay's status as a public company hurt it.
- scarejunba 8y agoHaha, all this is irrelevant when you can always count on your government arbitrarily banning foreign companies. Not really complaining. It's just business. And we need them more than they need us so they're turning the screws.
- influx 8y agoIs it really just business? Why doesn't the USA do the same to all foreign companies as well?
- dingo_bat 8y agoIt's called free market.
- bvc35 8y agoBecause people don't like Donald Trump.
- shitgoose 8y agoThey do not like him so much, that they elected him the President.
- dragonwriter 8y ago> They do not like him so much, that they elected him the President. As only the second most supported choice. After Hillary Clinton, who has long been one of the most widely despised national political figures.
- shitgoose 8y ago"Why doesn't the USA do the same" Do you mean "Why doesn't the USA government do the same"? US government is slightly less omnipotent than Chinese.
- influx 8y ago
- docker_up 8y agoCompeting against eBay is like saying you're competing in a 100m race against someone in a wheelchair. eBay has done nothing to make itself better in the last 15 years. New "features" routinely fail, and their APIs are a graveyard of dropped ideas. I hope Taobao expands to the US, eBay needs real competition, anyone working there should be embarrassed for themselves, more importantly the Directors and above.
- ionwake 8y agoI remember after deving a 50 player 3d networked multiplayer game in nodejs, that they became interested in interviewing me ( at the time node was only about 2 years old ). Unfortunately in the 4 hour pre-interview demo they wanted me to code, there was a deprecated call to a function I referenced later. Due to the time constraint I missed that one line of code. App worked flawlessly as I had tested it. Thing is I even knew I had a line of code somewhere that was deprecated but figured 4 hours was enough time to spend on a coding exercise, especially given, well , my 2 year demo project of a multiplayer game. As you can tell from the tldr; I was politely told they would not be interviewing me. All because of one trivial line of code, in a 4 hour demo done in my own time. To be honest, I knew the chap was giving me a chance to correct it by giving me a few days, but I thought it would be in bad faith to do it when I spotted the issue. Anyway, I didn't sweat it, I walked into a job at good startup, literally with gaffa tape on my sneakers and got it. They obviously make terrible decisions before even interviewing people in person.
- tehlike 8y agoIt was 99% not because of deprecated method, unless they explicitly told you so. Deprecated code detection is compile/build tools job, not yours.
- analyst74 8y agoKeep in mind that this story happened before taobao was launched in 2003, when eBay was the most dominant e-commerce player.
- techwizrd 8y ago
- forinti 8y agoeBay is such a horrible user experience that I wonder how it still stands.
- mikert5671 8y agoThis is propaganda
- microdrum 8y ago* Goes to war with eBay * * Yes, hello DNS this is Jack Ma, please nullroute ebay.cn kthx * * Wins war
- taobility 8y agoFrom all these comments, you can tell how naive those commentors are. If you all blame the failure of eBay due to Chinese government, why it would choose Alibaba, not other Chinese companies? Why Alibaba would success and be one of Top 2 in China? In 2000s, Alibaba is nobody, and eBay is the giant with unlimited fund and great brand. But it still failed due to its vanity.
- taobility 8y agoIt's easy to blame Chinese government as it's political correct. But don't forget, Chinese market is also a fully competitive market.
- pietroglyph 8y agoI agree that it's easy to blame the Chinese government in this case, and that there's more to it than that, but just because competition exists in the Chinese economy doesn't mean the government isn't adjusting the scales behind the scenes.
- wanghq 8y agoAlibaba not only competes with non-Chinese companies but also domestic companies/banks which have a closer relationship to government than Alibaba. For example, imagine how hard to start Alipay business when banks don't support you.
- pietroglyph 8y agoThat wasn't really my point… I agree there's competition, but my point was that business are behilden to the government's wishes behind the scenes.
- not_that_noob 8y agoSome of this is of course the Chinese government placing its thumb on the scales in favor of local businesses. It does this for a lot of reasons, but it's clear it happens. However, compare the situation to other more open countries (e.g. India, Japan, Indonesia ) There are culture, social and language specific nuances that local entrepreneurs understand far better than outsiders, and that accounts for a significant portion of these copycat business success. I think American business generally have a tough time accounting for the latter into account when they go overseas. IOW, not all of Jack Ma's success stems from the government being on his side.
- emodendroket 8y agoLook at Walmart's disastrous attempts at expansion in Germany, for instance.
- nehene 8y agoI think people are being lazy. Of course it is harder to operate in China than in e.g. Europe were US companies were able to avoid local regulation, make sweet heart deals to pay a lot less tax and engage in anti-competitive behavior. Still essentially all mayor tech companies, except Google and Facebook, are there. The large reason for Chinas success is that for every segment that FAANG casts its shadow in the west there is at least half a dozen companies in China. Europe doesn't lack e.g. map providers that even today could compete with Google if it wasn't for the Google's dominance in the overall market. Taobao is also a lot better than eBay. (And I don't see that in itself being a factor of anti-competitive behavior like in some other cases).
- jdietrich 8y agoI'm not sure that 'copycat' is entirely fair. Google wasn't the first search engine, Facebook wasn't the first social network, Amazon wasn't the first online retailer. Flipkart or Taobao have some similarities to certain western retail platforms, but are profoundly different in many important ways. WeChat might have had the advantage of the Great Firewall, but they have also built a genuinely innovative platform that is better suited to the Chinese market and in many respects much more sophisticated than any Western equivalent. No western company would have grasped the importance of hongbao or implemented it so skilfully. No western company could have anticipated the hugely positive reaction to WeChat Moments advertising and the remarkably high CPM. I think there's a certain "not invented here" attitude prevalent in Silicon Valley. We do iteration, they do copycats. We build a better mousetrap, they make shitty knock-offs.
- seanhunter 8y agoTo all the people saying Jack Ma is only winning because of govt intervention: Have any of you guys actually been on ebay in the last 10 years? The surprising thing is not that they got beaten in China, it's that they're still in business anywhere else.
- scubaguy 8y agoChoosing to dismiss Taobao's success because of the Chinese gov't stacks the deck against American companies is choosing to not learn anything from their success. For example, how to compete with eBay's business model. >> Taobao was vastly different from eBay China. Afraid that buyers and sellers might circumvent its system and avoid paying eBay’s commissions, eBay went out of its way to keep buyers and sellers blind to each other and unable to communicate with one another before a purchase. This was a major inhibitor to commerce in an environment where people were accustomed to building a personal relationship before doing business. >> Our approach was exactly the opposite. Because we were entirely free, it didn’t matter to us whether retailers consummated their deals with buyers through our site. In fact, we encouraged them to call each other, get to know each other, and even meet face to face for large purchases. We were confident that, just as we had found a way for Alibaba.com to make money from its users without transaction fees, we ultimately would find a way to make money from Taobao if its sellers were able to make money.
- forkLding 8y agohttps://www.google.ca/amp/s/www.forbes.com/sites/china/2010/09/12/how-ebay-failed-in-china/amp/ https://www.google.ca/amp/s/www.forbes.com/sites/china/2010/... See above for a more full analysis, Chinese govt. could have given preferential treatment but it was Ebay that had adverts all over Chinese buses and had blocked Taobao from advertising on Chinese web platforms through exclusive partnerships.
- mahranch 8y ago> Chinese govt. could have given preferential treatment How do we know they didn't? They could have just decided "Now that Taobao is up and running, we can get rid of ebay". They've done worse before, so it's not a stretch. It's interesting that there are no massive web properties in China with the bulk market share (google, facebook, ebay, amazon, twitter, etc) that aren't Chinese owned. Yet, in the entire rest of the world, those same websites are #1. That's not just some coincidence or one-off, that's clearly governmental manipulation and control. If it was just one or two web properties, I could understand. Like how it is with Yahoo! Japan. But all of them? Sorry, China doesn't want western companies running the show within their country. Articles like this are moot since there was no future with eBay in the #1 spot thanks to the CCP.
- forkLding 8y agoThose tech companies are the result of censorship and definitely Chinese preferential treatment and national security, etc. Chinese preferential treatment by a Chinese govt is normal like the US prefers US companies such as US bailing out Ford and GM because of jobs. China would much prefer chinese companies and workers instead of international because it provides jobs and income. US companies also dominate in China, see McDonalds or Starbucks or Apple in China. A lot of international companies dominate China, just not all of technology, also Apple is a tech company last time I checked. Even if it was a democratic Chinese govt, whats stopping it from supporting a Chinese company over a US one, whos to say that the democratic govt wont go China for the Chinese like Trump?