In what seems to be a very busy few weeks for Alibaba, the company made headlines once more for acquiring ‘Wandoujia’, one of China’s most prominent app stores, reported by Tech Crunch.
Media speculated that the deal was worth approximately $200 million. Although a significant amount, it seems small when compared to Baidu’s $1.9 billion acquisition of Android app store 91 Wireless in 2013, which claims its position as China’s top android app store.
In 2014, Wandoujia was valued at $1 billion, but the company has since faced increasing competition from 91 Wireless and Qihoo 360. Reports of internal conflict within the company contributed to its shortcomings and development over the past two years.
Wandoujia is currently the fifth largest app store in China, claiming 6% of marketshare.
The site offers mobile based content and products beyond apps. The acquisition means that Wandoujia will become an integral part of Alibaba’s mobile division, which includes browser-maker UC Web. With the company’s resources, the app store will have the chance to be a key distribution platform to engage Chinese consumers through mobile.
Independent app stores have flourished in China thanks to the blockage of Google services.
Google’s search engine and the Play Store is not available in China. The missing gap means that a lot of independent local companies can infiltrate a less dominated market. It also means that these companies have become the point of contact for international developers or startups whose eyes are on entering China.
A version of this article was published in Tech Crunch on July 7. Read the full version here.