Ebay Takes New Direction In China

Tom Online Inc. an Internet company based in Beijing. Ebay will have a 49 percent stake in the new venture while Tom Online will have a 51 percent share in the deal. The unnamed site is scheduled to open sometime in 2007. Ebay will invest $40 million in the joint venture while Tom will invest $20 million. Currently there are no plans to cut any jobs in China. The latest move is designed to strengthen Ebay's position in the region. Ebay has been struggling to compete with Taobao, the consumer auction branch of Alibaba.com, which is the largest e-commerce company in China. In 2005 Analyst International said that Taobao held 57 percent of the online auction market in China while Ebay held 31 percent of the market. Ebay's strategy mirrors what Yahoo did last year when they made a deal with Alibaba. They paid $1 billion to Alibaba for a 40 percent share in the company after they had trouble becoming established in the Chinese market. Ebay has made some miscalculations in the China market. According to Ina Steiner, the editor of Murdok. Visit

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