eBay Plans to Pull Back From Chinese Market
eBay plans to pull back from the fast-growing Chinese market by shutting down its main Web site in China and replacing it with a new site that would be largely run by a Beijing-based Internet company, say people familiar with the matter, in the latest sign of trouble afflicting the onetime Internet star.
Under the new arrangement, eBay will hold a 49% stake in the new site with Tom Group holding a 51% share. eBay does not plan to lay off any employees as part of the new setup.
The move could be read as a setback for eBay, which has struggled to stay in place in the face of intensifying competition in China. "We believe we're actually maintaining share in what is becoming an even more competitive market," said eBay CEO Meg Whitman during the company's third quarter conference call. "There are many new entrants in the business, but we feel pretty good about where we are."
Whitman said at the time that eBay was committed to China in the long-term, but refused to discuss whether the company would consider partnering with a local Chinese company as part of its future strategy.
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