Kara Swisher

Recent Posts by Kara Swisher

Jack Ma Takes His Own Advice for Yahoo: Alibaba Splits Taobao Into Three Parts

In an interview I did with him at the recent ninth D: All Things Digital conference, Alibaba Group CEO Jack Ma suggested that Yahoo would be better off splitting itself up into smaller pieces.

Today, he did that for one of the key units of the Chinese Internet giant, cleaving its Taobao e-commerce unit into three new companies.

Said Alibaba:

Alibaba Group is reorganizing Taobao into three separate companies to capture the Chinese consumer e-commerce opportunities. Effective June 16, 2011, the three companies, which remain wholly-owned subsidiaries of Alibaba Group, will begin operations as: Taobao Marketplace (www.taobao.com), China’s leading consume-to-consumer (C2C) platform; Taobao Mall (www.tmall.com), China’s leading business-to-consumer (B2C) shopping site; and eTao (www.etao.com), a product search engine designed to make it easier for consumers to find goods and services offered by all e-retailers.

We believe this move will benefit our customers, as each of the three companies will be able to focus on its own unique consumer experience. The board of Alibaba Group is fully behind this decision, as the move will create more value to shareholders by fostering innovation and capturing more opportunities in China’s fast-growing e-commerce sector.

Interestingly, the move means no massive IPO for Taobao, which some investors have been hoping for.

Here is Alibaba CEO Jack Ma’s email to employees on the change:

Ma Letter on Taobao Reorg

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik