Alibaba has partnered with China’s biggest telecom operator to sell low-cost smartphones to people in rural areas for prices as low as 299 RMB ($48).
The deal with China Telecom, which has 186 million users, is part of a two-pronged strategy for the e-commerce giant, which sees smaller cities as key to its growth plans for its e-commerce business and operating system YunOS.
A line of eight inexpensive smartphone models from obscure brands like Uniscope, Ctyon, and Kingsun will come loaded with YunOS, the operating system developed by Alibaba to compete with Android. Six pricier models from better-known makers like Coolpad, Hisense, and TCL, on the other hand, will have Alibaba’s shopping app Mobile Taobao pre-installed.
The smartphones will be sold in China Telecom stores. The telco had 15,000 retail outlets in rural China at the end of 2015 and is planning to add more locations.
The company wants to position YunOS as an alternative to Android, which holds a 80.4 percent market share in Chinese cities according to Kantar.
Despite moves like a $590 million investment in smartphone maker Meizu, which uses YunOS on some of its handsets and a partnership with Quixey to power YunOS search, however, the operating system has yet to take off and had just 10 million users as of October 2014.
Alibaba may have better luck expanding its e-commerce business in rural areas by targeting rural areas. A report by Alibaba research unit AliResearch estimates that China’s rural e-commerce market will hit 460 billion RMB ($75 billion) by 2016, with rural residents spending an average of $80 to $300 online each year. Furthermore, merchants living in rural areas have opened 480,000 stores on Taobao.
The online marketplace is so important to the economy of some farming communities thatthey’ve been dubbed “Taobao Villages.”
Founder and executive chairman Jack Ma has said that Alibaba’s near-term expansion planswill focus on smaller Chinese cities instead of overseas markets.
Though buyers from so-called “third-tier” and “fourth-tier” cities tend to make smaller purchases than their counterparts in larger cities, like Shanghai and Beijing, but they are still an important growth driver, and helped push the company’s sales on last year’s Singles’ Day online shopping bonanza to a record $9.3 billion.
Buyers using mobile devices accounted for 42.6 percent of sales, underscoring why it’s important to get smartphones and Alibaba’s shopping app into the hands of potential customers.
http://techcrunch.com/2015/04/26/alibaba-rural/
Chinese e-commerce titan Alibaba Group Holding will inject its online-pharmacy business into the company’s Hong Kong-listed healthcare arm in a HK $ 19.4 billion deal($ 2.5 billion), as the group seeks new opportunities in China’s fast growing healthcare sector.
Alibaba Health Information Technology will issue shares and convertible bonds to acquire an online transaction platform for web pharmacies on Tmall, Alibaba’s business-to-consumer website. Alibaba Group will own almost 56% of Alibaba Health when the bonds are fully converted, it said in a statement today. Currently it has a 38% stake.
Alibaba Health will issue shares at HK$ 5.28. The conversion price will be HK $5.8 per share.
After the deal, Alibaba health will be better positioned to enter the online-prescription drugs market, according to the statement. Pharmacies on Tmall currently sell over-the-counter medicines, contact lenses, medical devices and other products. But the government in Beijing is widely expected to hand out licenses allowing sales of prescription drugs online.
Prescription-drug spending in China is expected to reach $120 per capita in 2018 from about $ 70 in 2013, according to a report from IMS Health Institute for Informatics. The country’s total healthcare spending will grow from $ 357 billion in 2011 to $ 1 trillion in 2020, projected McKinsey& Co.
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Alibaba Health is already testing a smartphone app that allows customers to quickly fill prescriptions. Using their smartphone cameras, customers can upload photos of prescriptions and check availability and prices at nearby pharmacies.
Alibaba is also eyeing other healthcare opportunities. The group’s financial payment affiliate Alipay seeks to considerably shorten appointment time by letting users book appointments at selected hospitals through a smartphone app. Patients could also make payments and receive diagnostic results using their smartphones.
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