Yahoo Flog Chinese Ambitions

By Bibika, 22nd May 2012 | Follow this author | RSS Feed | Short URL http://nut.bz/36oskkl_/
Posted in Wikinut>Business>Sales & Marketing

The former darling of the tech market Yahoo has just announced a deal which will see its stake in the biggest internet company in China be repatriated for some $7 million.

Yahoo's Deal With China's Biggest Internet Company

The former darling of the tech market Yahoo has just announced a deal which will see its stake in the biggest internet company in China be repatriated for some $7 million. So okay, says the SEO Consultancy team at agency Cayenne Red, Yahoo has its own problems, but this is more a case of the Chinese having learnt the power of the internet and can now handle it themselves thank you.

It’s a standard joke in manufacturing that if you joint venture with the Chinese, give it five years and they’ll be building your product better than you. And in ten years, you’ll be a service company buying in what was once your product and selling it on as a middleman.

The Chinese are adept business people and superb engineers, but for years were behind in terms of technology. Communism was not a great system for encouraging entrepreneurs, or scientists, or any free thinkers, so when China began to compete on the international stage, it lacked the design, scientific and engineering capability.

Not so now though. Give it ten years and the Chinese will be fully up to speed.

And much the same is happening in the internet market. Some years ago, China was keen to plug the holes in its skills gap. Not so much at the computer engineering end, because their skills here are now fully comparable with the West, but with the social media skills and SEO tactics that are so necessary these days.

But now, the West has little to teach the Chinese about the internet and what a powerful tool it is. Indeed, the Chinese have their own approach with the internet: turn it into another arm of the state propaganda unit. The online bamboo wall is adept at trying to control the people’s content and access to influences outside of China.

And Western tech companies have had a hard time trying to convince the community leaders otherwise. Google tried, but has since basically given up.

And that’s the saddest thing about Yahoo’s decision to offload their 40% stake in China’s biggest internet company, Alibaba. Not only does it mean a major foothold in the Chinese online market has been lost, but it’s also gone in-house, with Alibaba buying back the stake.

Yahoo had little choice but to sell (it’s got its own problems), but the fact that it didn’t sell to a company outside of China is a shame. Mind you, when it comes to buying and selling stakes in Chinese companies, you basically do as you’re told by the leadership.

But it’s another sign that the Chinese are coming of age as regards the internet, and the bamboo wall is being erected not just for its citizens, but also those Western tech companies who see China as a huge untapped marketplace.

Attribute to: Biljana Dimovska, Cayenne Red.
Biljana Dimovska is a member of the digital marketing team at UK SEO Consultancy Agency Cayenne Red. She is a regular contributor to the media on how companies market themselves in the digital age.