Saturday, February 9, 2008

Microsoft-Yahoo deal bad for Alibaba

Buried in the reporting about Microsoft's bid to buy Yahoo is what a deal could mean for Chinese e-commerce company Alibaba. Yahoo owns 39% of Alibaba. In turn, Alibaba manages Yahoo China.
It's a close relationship between Yahoo and Alibaba, and their two founders, Jerry Yang and Jack Ma -- who met at Pebble Beach and put the unlikely Yahoo-Alibaba deal in the works that very day in May 2005.
Now, Ma is putting the finishing touches on a remake of Yahoo China into a web 2.0 portal. If Microsoft comes in as a new owner, his strategy to transform the troubled portal could be interrupted. (or perhaps there's some ideas there for Yahoo to regain its glory in the U.S.)
Moreover, Microsoft does not have the following of fans it once did among software engineers --and Yahoo China and Alibaba techies could revolt against a takeover.
All in all, Jack Ma is probably not having a very restful Chinese New Year.