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Alibaba Says Its Future Depends On Fighting Counterfeiters

May 19, 2016, 7:38 PM UTC
Alibaba Group Holdings Ltd. and Founder Jack Ma As Company Files for U.S. Initial Public Offering of E-Commerce Giant
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Facing backlash over counterfeit items being sold on its marketplaces, Chinese e-commerce juggernaut Alibaba is on the offensive.

Alibaba president Michael Evans said on Thursday that Alibaba’s future depends on its success in fighting counterfeiters. He argued that his company was “100% committed to fighting this battle” while emphasizing the need to work with product makers to tackle the problem.

Speaking at event sponsored by Washington, D.C.-based International Anti-Counterfeiting Coalition, or IACC, Evans also talked about Alibaba’s data team that helps track down counterfeit goods sold by third parties through its e-commerce sites.

“Our anti-counterfeiting system is now processing 100 million pieces of data per second,” he said. “We’re talking about 8.64 trillion pieces of data each day. In 2015, we were able to block and proactively take down around 120 million suspicious product listings on Taobao. That’s before any of you asked us to do anything.”

Alibaba’s flagship e-commerce marketplace Taobao, where sellers list everything from scorpions to fake Louis Vuitton purses, has long been known as a source of counterfeit goods. The site is a Chinese version of eBay with nine million small sellers.

Last month, Alibaba gained membership into the IACC, prompting a number of the group’s other members, including Gucci America and Michael Kors, to quit in protest. The companies even went as far as describing Alibaba as “our most dangerous and damaging adversary.”

It was also revealed that IACC president Robert Barchiesi owned Alibaba stock, which raised accusations that he had a conflict of interest in his role leading the coalition. The coalition has hired an independent organization to investigate the allegations.

Soon after the backlash started, the coalition said it would suspend Alibaba’s membership. Alibaba, which disagreed with its suspension, has vowed to keep fighting counterfeit goods despite the recent events.

Alibaba’s founder, Jack Ma, was originally schedule to speak at the IACC event on Thursday. But he pulled out and was replaced by Evans.

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Evans also spoke of early success in removing counterfeits from Alibaba’s site. Through a partnership with product makers and IACC, Alibaba has shut down and banned nearly 5,000 storefronts on Tabobao, according to Alibaba. It has also removed more than 180,000 counterfeit listings.

In the past, Alibaba has made strong statements against counterfeiting, but the problem has persisted. The company is now trying to show that it is taking real action. Alibaba said previously it is spending millions on anti-counterfeiting efforts and hired a former Pfizer executive to oversee its anti-counterfeiting programs in December. But don’t count on Alibaba to win the good graces of product makers anytime soon.