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#AsiaD: Jack Ma Worries About Virtual Currency Collapse; On Aliyun Mobile OS, Yahoo, Fake goods & More

Speaking at the AsiaD Conference in Hong Kong, Alibaba Chairman Jack Ma said that the next big wave will be the mobile Internet, and China needs its own mobile operating system to help lower the cost of mobiles. “Our people spent time on it, and it is not beautiful, but when a baby is born it is not beautiful, it takes time. China needs an OS to lower the cost of devices. We will pay any price to move this industry on.” On being asked why he thinks Google or Windows can’t do it, and why Alibaba did its own OS, he said “Let them do it. Ebay was doing well, but we still did it. We are looking to enter that market, making sure that the total cost of mobile goes down with innovation. We are building a platform for making Taobao and Alibaba on mobile. The mobile Internet has such huge potential,” he said.

A lot of companies are talking about cloud computing. We have so much data from small business, and from Alipay transactions. Data will be so important to our small business, so lets invest on it. We’re selling services.

On Online currencies/ Virtual money & Online Gaming: “Honestly, I may not be right, but when we talked about it internally, I was strongly against it. If you’re doing business in China, RMB is the main currency. Virtual currency – I worry about that. I don’t want to have thousands of coins that I don’t want to do. and the government will take action. I don’t know how, but I think they will,” Ma said. On online gaming, Ma said that Alibaba didn’t get into Online gaming because he knows that some day the government will take action, because everyone was just killing each other in the games. “This can become too big a problem.” Alibaba doesn’t have the intention of getting into gaming.

On the bid to buy Yahoo: said that he’s waiting for Yahoo to respond, because he is interested in a deal with them, but they need to let them know. And what would he change at Yahoo? Its management. Ma is looking for partners to buy Yahoo, and said that the USA needs more Chinese investments, and a deal would be good for the USA. “I don’t want to go there fighting, I want to partner. The US needs jobs and innovations from others. They also need a tiny SME innovation. Ebay has great ideas, but it doesn’t mean that it is its market alone.” Ma said that they are waiting for answers from Yahoo’s board, and that money isn’t in short supply. “So many PE’s are talking to us. We will talk to them in the next few weeks.”

“Time is so precious for all of us, and this is not good for Yahoo. Please make up your mind,” he said.

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– On when to invest: “When everyone says go fast, go slow. When everyone says go slow, move fast. This is the way we’ve done things.”

– On China copying what ever is in the West: “I don’t agree with that. I respect intellectual property. If nobody innovates on the innovation, there is no problem. ICQ made the IM, but QQ made it even better. China invented gunpowder, the West built on it.”

– On 50,000 people protesting after Alibaba raised pricing, and not backing down: “The last 10 days were the most painful days for me. There was a song I heard that said that the people who hurt you the most are the people who you love the most. We have over 1 billion listings, and 70 million visitors a day. But a lot are fake products. We decided that to fine those merchants 5 times for fake products. We don’t want IP issues, no fake products. We would never take one step back from the fake products and IP problems. The problem is that this cannot be solved by Alibaba alone.” Ma also said that this is pre-emptive measure, and this was likely to be an even bigger issue three years from now.

– Does he worry about making Alibaba more innovative: “No I don’t. We are a service company, our job is to use the Internet to serve the customers. We started from a B2B play. My customer, my belief is small business. I’ve been working as a startup entrepreneur for 15 years.”

– On competition and Baidu vs Alibaba: “We will become greater competitors over time. It’s better for the market. We’re separating Taobao into three companies. If we are big, the industry remains small, if we are small (and grow each separately), industry will be bigger. Competition is the fun part of the business. This is the market effect. E-commerce is big, but compared to tomorrow’s e-commerce, it is pretty small. One thing I feel very different, a lot of people think first of competition, and I think it is about customers. We get bored finding competitors.”

– Charity? “I never said never donate money to something. We contribute 0.3% of our revenues to environment protection. I spend a lotof money, it’s a private thing. For the business, we have to bear our social responsibility into the business model. The business model should create value and be good to society. It’s my decision, my principle.”

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– On Government regulation and censorship: “What I believe is that it is good for the others. Don’t wait for the government to come.” On censorship stifling entrepreneurship? “Depends on which angle to see. Censorship is an issue, but not a big issue. It’s always been my optimistic view. I think China’s government is getting more and more open, and then in some period it becomes closed. It’s natural.”

– On China’s challenges in the next 3 years: “As a business guy you have to smell what is going on in the market. What is happening in the US and Europe is going to happen to China – job problems, import export problems, because China’s exporting problem is getting worse.We need to take action on domestic demand. I don’t see people are ready to pay the price for upgrading. We have to take the challenges. They’re ready to take challenges.

I’m confident about China the next six months, but there will be a problem in 3 years. When we talk about the financial crisis, the early of 2008. I made the company get ready for that. Import-export is the problem. And every fund I go to is talking about an IPO, but no one talking about value creation.”

Written By

Founder @ MediaNama. TED Fellow. Asia21 Fellow @ Asia Society. Co-founder SaveTheInternet.in and Internet Freedom Foundation. Advisory board @ CyberBRICS

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



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