Ebay has conquered online auctioning, racking up $778 million in profit last year on a transaction volume of $34 billion. But Ebay won't stay on top unless it also conquers what eventually will be the world's largest mar-ket for online goods: China. Ebay bought its way into China in 2002, holds half of a $1 billion market and will spend $100 million this year to bolster its presence there. China is a "must win" and "is likely to be the defining measure of business success on the Net," Ebay Chief Meg Whitman told Wall Street analysts in early February. "A bunch of small competitors are nipping at our heels." Jack Ma is more than a mere ankle-biter. Ma runs the Taobao consumer auction site, the biggest homegrown rival to Ebay in China. Though it didn't start up until a year after Ebay arrived, Taobao quickly has gobbled up 41% of online auction sales, compared with Eba's 53%; it has 4 million registered users, gaining on Ebay's claim of 10 million customers in the country. To take on the decidedly American presence of Ebay, Taobao-Mandarin for "searching for treasure"-plays up its local staff and an all-China focus; its online moderators use screen names from characters in famous Chinese kung fu novels.
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