Alibaba and the Albatross

Alibaba's 2005 deal with Yahoo! is increasingly looking like an albatross shooting spree. It's a dodgy business, not doing very well in China, and has now raised the spectre of substantial ownership by Microsoft. It also has brought the company several times into the spotlight of the human rights lobby.

Back in October 2005, not too long after the Yahoo! billion was accepted, the company was roundly criticised for its role in the Shi Tao affair. Now, an interesting article in the Far Eastern Economic Review has once again links Alibaba's Yahoo! division to Beijing's control and abuse of information and Internet freedom. The article focuses on the role played by the Beijing Association of Online Media which, it claims is more an arm of State control than industry association.

The article quotes Alibaba's Porter Erisman and I have to say that the way in which the writer has tried to turn what is basically a "no comment" into something very sinister may suggest that molehills were made to look very mountainous in this article.

Overall, Alibaba is a fine business. The Yahoo! China arm it inherited in 2005 is quite obviously it's least interesting or useful division. How easily can they ditch it?