Alibaba's shares almost tripled on its first day after an initial public offering in Hong Kong at the beginning of November 2007 — it closed at HK$39.50 from their HK$13.50 offer price. The company's listing prospectus said it would triple profit to RMB622 million in 2007, making the stock very palatable for investors.
The company is unique among Chinese Internet services in that it has few equals. Whereas Sina.com, Sohu.com, Netease.com, and Tom.com all compete for the same Chinese Internet consumers by providing similar services, Alibaba is unrivaled in China. Sure, there is Global Sources pecking at its heels, but Alibaba is different in that it really focuses on Internet-only activity (yes, it does have a print magazine and is starting to do conferences, but it is really a different animal than GSOL).
Jack Ma, Alibaba's founder, speaks in grand, patriotic terms about how Alibaba is bridging the divide between China and the outside. He speaks so much of Alibaba being the bond among people around the world and of Alibaba bringing new kudos to China, that it's easy to forget Alibaba thrives on the same capitalism that was a crime a few decades ago. Alibaba straddles both New and Old China.
I am not saying Alibaba is the top Internet company for 2007 — the company still has a long way to go to prove good governance, a sustainable model, and the ability to mutate as times change. Instead, the buzz around its IPO coupled with its hold on Yahoo! China (and the furor around that entity in U.S. courts); its dynamic business model; and the growth of its subsidiaries like Alimama and Alipay in 2007 make the Alibaba IPO my China technology news story of the year.
Thursday, January 3, 2008
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