Alibaba is partnering with China Telecom to sell low-end smartphones in an effort to expand the e-commerce giant’s sales in less developed parts of China.
Alibaba said the handsets, sold as Tianyi Taobao devices, will have an app to access its Taobao online shopping platform or its home-grown YunOS. Six models made by Coolpad, Hisense and TCL will come with the Taobao app pre-installed, while another eight models will run on the YunOS, Reuters reported.
Buyers will receive four months of free 2G data service.
Alibaba’s Taobao is the country’s most popular mobile shopping platform with more than 200 million monthly active users. Alibaba added 48 million monthly active users on mobile in the last quarter of 2014.
Almost half of China’s mobile customers have broadband connections, but demand for smartphones has peaked, as shipments last year dropped 8 per cent to 389 million, according to the China Academy of Information and Communications Technology.
But mobile shopping continues to expand. Alibaba’s mobile revenue expanded fourfold in the quarter ending 31 December from a year ago to more than $1 billion (CNY6.42 billion) and now accounts for almost a quarter of its total revenue.
Alibaba’s Alipay had an 83 per cent share of the third-party mobile payment market, according to Beijing-based iResearch. China’s third-party mobile payment gross merchandising volume (GMV) expanded almost fourfold (391 per cent) last year to CNY5.99 trillion ($970 billion).
In early February Alibaba announced it would invest $590 million to take a minority stake in mainland mobile phone maker Meizu Technology, giving it a captive hardware platform for its mobile operating system.