Some Yahoo executives say the Chinese government's harsh treatment of Google and other internet companies in the past six months has dispelled Yahoo's desire to conquer the Chinese market alone.
The US internet company sold its online trading platform, Alibaba, for about $ 150 million this week.Alibaba.com 1 percent.
The shift in Yahoo's approach underscores the fact that foreign companies remain largely blocked from the Chinese market, as China remains determined to develop the internet on its own terms.According to the number of internet users, China is the largest internet market in the world.
China's goal of becoming a Yahoo is a natural thing.The company has been experimenting in China for years, and Carol Bartz, who took over as Yahoo's chief executive in January, sees overseas expansion as a priority, especially in countries where internet penetration is still a long way off.
But the Google experience seems to have chilled Yahoo's ambitions.
Google's global w But the Google experience seems to have chilled Yahoo's ambitions. eb site was blocked in China, and after years of fighting, the company established its presence in China in 2006.Since then, its market share has risen to more than 20%, but still lag behind the local online search leader Baidu (Baidu), which has a market share of more than 60%.
This year, the Chinese government began a vigorous crackdown on Google, accusing the company of allowing pornography to appear in its search results as a punishment for shutting down certain features that are essential to attracting user traffic.It was the biggest crackdown since Google created its Chinese website.The site was once blocked, and YouTube, Google's video-sharing site, has not been able to browse in China since March.
“This tells us that for foreign internet companies, the situation in China is not improving and there is no chance of a level playing field, even for Google, " said one Yahoo executive.”
After a difficult start, Yahoo in 2006 in China Business transferred to the Alibaba parent company, for the Chinese e-commerce company 39%. Yahoo had hoped to continue to expand its presence in China."Yang believes that we can buy more shares and return to the Chinese market.But now it's all over, " the executive said.Jerry Yang is the founder and former CEO of Yahoo.
Yahoo China's market share has fallen from about 20 per cent to 6 per cent since the 2006 deal, according to Analysys, a Beijing-based internet research firm.Yahoo executives said they were“very unhappy”that Mr. Batz was running Alibaba's China business as if it were a success.
"As the new chief executive, she has to look at how the brand performs in all major markets, " the executive said.And as we all know, the Yahoo brand is not doing well in China."
In his first months in office, Mr. Butts has invested heavily in countries where the internet business is expected to grow, even as the company is cutting costs in other markets.Yahoo's biggest acquisition this year was the acquisition of Arabic-language portal Maktoob in August, which experts estimate is worth $ 75 million.
Overall, according to company insiders, Mr. Butts had little interest in establishing joint ventures and holding minority stakes, so he had studied the possibility of opening new businesses in China and severing ties with Alibaba.But one insider said that acting alone after the Google incident seemed too risky.
“Looking at Google, we realized that keeping an investment in Alibaba is the only thing we can do in China, " the person said.Another Yahoo executive said:“Mr. Butts felt strongly that it was a much better strategy for Yahoo not to operate directly in China.”
So, for the foreseeable future, severing ties with Alibaba does not seem to be within Yahoo's purview.The sale of shares in Alibaba's parent company, which is not yet publicly listed, would have painful tax consequences, and Yahoo's exit would require the consent of all parties, including other institutional investors in Alibaba.
Yahoo has accepted the fact that it can only watch China on the sidelines.