Information Technology News
- EBay venture seeks to double market share
Date: 4-Sep-2007 Sources: (Shenzhen Daily)
TOM Online Inc., Hong Kong billionaire Li Ka-shing's Internet company that took control of eBay Inc.'s online auction unit in China, aims to more than double its market share in China by the end of the year.
The Web auction site, renamed Eachnet.com, wants to have a 20 percent to 30 percent share of the Chinese market by the fourth quarter, Tom Online chief executive officer Wang Leilei said yesterday. EBay owns 49 percent of the venture with Tom Online, a unit of Tom Group Ltd.
EBay agreed in December to give control of its Chinese auction unit to Beijing-based Tom Online after losing users to local rival Alibaba.com Corp., which boosted its share of the market to more than 80 percent by letting users sell items on its site for free. Tom Online, in a bid to lure users, has also ended fees for posting items for auction and moved the site to computer servers in China from the United States to boost speed.
'E-commerce is not a business that becomes profitable immediately,'' Wang said, without giving a forecast for when the online auction venture with eBay might post a profit. Tom Online said in July its 51 percent of the auction venture resulted in a loss of US$3.95 million in the second quarter.
The Chinese market share of eBay's venture with Tom Online, formed in February, fell to 7.2 percent in the second quarter from 16 percent in the first three months, according to researcher Analysys International.
Taobao.com, the Web auction unit of Alibaba, boosted its share of the country's market to 83 percent in the second quarter from 74 percent in the first quarter, the Beijing-based researcher said. Tencent Holdings Ltd.'s share was unchanged at 9 percent.
Eachnet.com stopped charging users for selling items on its Web site if they use the company's escrow payment service, said Chang Lin, who helped redesign the venture's Web site. The auction site is instead selling advertising, accounting and other services to its users, she said.
San Jose, California-based eBay continues to operate its Kijiji.com classifieds Web site and PayPal online payment service in China and has a development center in Shanghai.
China was home to 162 million Internet users at the end of June, second only to the United States, according to the China Network Information Center, a government-backed agency that licenses online domain names.
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