Competition on China's e-commerce market intensifies
Both the eBay Eachnet under the US giant eBay and the largest Chinese
e-commerce company Alibaba are busy building secure online payment systems,
heating up the competition on the domestic e-commerce market, Thursday's China
"This year will be critical for the development of e-commerce
and online payment," said Jack Ma, CEO of Alibaba and Taobao, Alibaba's
subsidiary online auction website.
He said Wednesday at a press conference
that his company will use the experience of Taobao's online payment tool AliPay
for the business-to-business e-commerce website Alibaba.
With Alipay, buyers
can deposit money into a bank account designated by Alibaba and Taobao. Sellers
only receive payment when the deal is verified by buyers.
Alibaba and Taobao
have partnered with four major Chinese banks to guarantee the security of the
system and ease traders' worries.
The Hangzhou-based e-commerce company has
also promised to refund all losses, if traders use Alipay in the
According to Ma, 70 percent of transactions made on Taobao.com
have used Alipay since the website introduced the service in 2003.
expected total registered users of Alibaba and Taobao to reach 30 million this
year from 11 million at the end of 2004.
EBay Eachnet, in fierce competition
with Taobao, also announced yesterday that it would spend more than 100 million
yuan (US$12 million) this year to launch a new online payment system.
auction giant said last month that it would invest US$100 million in eBay
Eachnet this year with the 100 million yuan (US$12 million) part of that
James Zheng, chief operating officer of eBay Eachnet, said his
firm will launch a new online payment tool in the first quarter, combining the
situation of China's e-commerce market with the technical expertise of eBay's US
EBay Eachnet launched a payment system called Escrow in October, similar
to AliPay, to create a more secure online payment environment for
The online auction firm also opened a China Service Center, serving
customers in the Chinese mainland, Hong Kong, Macau, and Taiwan. Zheng said the
center will increase staff numbers this year from 150 to 400. EBay Eachnet's
registered users topped 10 million on January 13.
Henry Yang, president of
Shanghai iResearch Co Ltd, a professional Internet industry consultancy, said
trading security was still a major obstacle in China, so the industry still
needs to strive to ease people's e-commerce concerns.
According to iResearch,
the total trading volume of e-commerce in China will grow from 440 billion yuan
(US$53.14 billion) in 2004 to 620 billion yuan (US$74.88 billion) this year.