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Alibaba may invest $150M per year in new mobile OS

updated 04:23 pm EDT, Tue September 11, 2012

Chinese e-commerce company takes aim at iOS, Android

Alibaba, the largest e-commerce company in China, is planning to increase investment in its in-house mobile OS to the tune of around $150 million per year. The company spoke with The Wall Street Journal, saying that it is seeing stronger demand for its Aliyun OS, as a number of Chinese manufacturers are dissatisfied with Google's Android, while Apple's pricing for its iOS devices may leave an opening for lower-priced competitors. With the Chinese mobile market among the world's largest, Alibaba hopes to carve out a niche offering affordable phones that rely on its cloud services.

Alibaba's Aliyun OS grew out of the company's desire to funnel users into its e-commerce services. Since its debut last year, only around a million smartphones have been sold bearing the Aliyun OS. The cloud OS is based on Linux and runs apps via virtualization. As a result, users are more dependent upon an Internet connection than they would be with an Android, Windows, or iOS device. Aliyun is currently found on two models, the K-Touch W800 and the Haier Zing. The company is thought to be either working with another manufacturer to develop a flagship Aliyun handset or developing one in-house.

According to Aliyun, Google's well-publicized clashes with the Chinese government put the American company at a disadvantage when attempting to access the Chinese market. Services integral to the Android experience -- such as Gmail and Google Maps -- are limited or unavailable in China. Alibaba believes that it can step in where Google has been hobbled, and it has dedicated an R&D team of more than 1,200 people to that goal.

The company also believes that its in-house OS could prove attractive to manufacturers, who may be reluctant to develop new devices on Google's platform in light of Samsung's recent loss in a patent battle with Apple.

Taking on Android, the dominant mobile OS in the world, may seem a lofty goal, but Alibaba has proved ambitious in the past. Last year, the company attempted to engineer a deal in which it would buy all of Yahoo, though that deal fell apart and Yahoo subsequently divested much of its holdings in Alibaba. The Chinese company isn't alone in taking on the mobile sector either. Chinese search giant Baidu also plans to offer cloud-based services to mobile customers, though its solution would be built atop Android, iOS, and Windows.

by MacNN Staff



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