An interesting report from Reuters/ eWeek suggests the Chinese Government may be concerned about Microsoft, a firm that uses “monopolistic tactics” buying Yahoo, which will mean Microsoft will become the biggest shareholder in Alibaba, one of China’s biggest internet firms.

According to the report Alibaba “will seek a stronger voice for its management team in Microsoft’s talks to acquire Yahoo.”

Although Alibaba has Yahoo as its biggest shareholder, the firm is run locally by founder Jack Ma, who maintains effective control over the business, although Jerry Yang sits on the board.

While Google dominates the top slot in search both in the U.S. and worldwide, with a global search market share of 62 percent, there is still a lot of elbowing going on below, especially when you look beyond the U.S.

In a comScore ranking of the top-10 global search engines as measured by number of searches during the month of December, 2007, Yahoo comes in at a distant No. 2 with only 13 percent of global share. (Although, in the U.S., Yahoo actually gained a half-point of share in December, whereas Google dipped 0.2 percent). The big surprise, though, is the strength of local search engines in countries that don’t use the Roman alphabet. No. 3 on the list is not Microsoft, but Chinese search engine Baidu (with 5 percent share, versus Microsoft’s 3 percent). No. 5 is Korea’s NHN Corporation, which operates the Naver portal and search engine. Creeping up on Ask’s No. 8 spot, is Russian search engine Yandex. And Alibaba (which may include Yahoo China) brings up the rear at No. 10.

Shouldn’t the best search technology win no matter what the language? These market share figures suggest that culture and marketing play a big role as well—unless, of course, you are Google.

Mitch Free has a knack for attracting high-profile investors to his manufacturing marketplace, MFG.com. First, Jeff Bezos convinced Free to back out of a previous agreement to sell the company and personally invested $14 million in September, 2005. Then Bezos put in some more money along with the German Samwer brothers (who founded Alando, Jamba, and invested in Studivz) in a $4 million round in January, 2007. Now, Free has raised another $26 million, nearly all of it from Fidelity (Fidelity Ventures and Fidelity Asia Ventures put in $25 million, the rest came from existing shareholders including the Samwers’ European Founders Fund). The big seller was founder and CEO Free, who sold a chunk of his personal shares in the company. With this funding, his stake went from a controlling 50 percent to less than 30 percent.

Never heard of MFG.com? You are probably not in the manufacturing industry. Founded in 2000 and based in Atlanta, MFG.com is an eBay for manufacturers—a B2B marketplace for sourcing manufactured parts from all over the world. Companies as diverse as Black & Decker, Harley Davidson, NCR, and Sara Lee use the site to find suppliers for machined parts, plastic moldings, metal stampings, and fabrications.

You can find nearly $50 million worth of requests for manufacturing quotes per day on the site, complete with CAD diagrams and other specifications. Manufacturers bid on the requests. MFG.com makes money by selling yearly subscriptions of several thousand dollars each to suppliers who want access to MFG.com’s community of purchasing managers and engineers at buying companies (who get to use the site for for no charge). Free learned that in the manufacturing world suppliers are much more willing to pay a flat fee than to give a cut of each transaction.

Over the past year, he’s been making a big push into China and connecting the vast network of manufacturing suppliers there with corporate customers all over the world. In part, that is what attracted Fidelity Ventures, which was an early investor in Alibaba and sold its stake to Yahoo. One part of Alibaba’s business is an online B2B directory. Fidelity’s Larry Cheng, who invested in Alibaba and now will take a board seat at MFG.com, told Free that he sees MFG.com as an “Alibaba on steroids.” (Cheng is also a board member of P2P lender Prosper). Daniel Auerbach of Fidelity Ventures Asia will take an observer seat on MFG.com’s board. Aurbach was previously an Alibaba board member.

Free has been known to talk smack about Alibaba, which recently had a successful IPO. He tells me:

The Alibaba model (directory “brochure-ware”) is not very deep but it was in step with the sophistication of the Chinese market. To truly remove inefficiencies in the manufacturing industry there has to be a platform that facilitates collaboration, transactions, negotiation, audit trails, intellectual property protection and more. MFG.com has built that platform and is preparing to scale it globally.

Free plans on using MFG.com’s new capital to continue expansion in the U.S., Europe, and China, as well as to ramp up in India, Japan and Eastern Europe. But he has greater aspirations for MFG.com than just to break into new markets. He wants MFG.com to become the “operating system for the manufacturing industry.” His acquisition in 2006 of SourcingParts.com gives him the technology and customer reach to build Web-based software for the manufacturing industry. He wants to build a platform similar to Salesforce.com’s AppExchange for manufacturing-oriented applications. He’s already gathered the community of purchasing and factory managers who might use such software.

Another possible use for that $26 million is more acquisitions. Free has talked to me about his desire to find 3-D search technology that can operate on a commercial scale to match an engineer’s CAD diagrams with the historical inventory of parts sourced on MFG.com. His idea is to offer a service that would allow engineers to estimate the manufacturing costs of their designs on the fly, based on the shape and materials of the parts they need. If he ever finds such a technology, now he has the money to buy it.

The IPO of Alibaba.com hit the Hong Kong Stock Exchange Tuesday (local time) with a big increase over its initial offering price.

Alibaba.com is a spinoff from the Alibaba Group, the company that owns Alipay, Taobao.com and Yahoo China and is 40% owned by Yahoo.

Applications for shares in the IPO were 256x the amount of stock available, 858.9 million shares or 17% of the company. The IPO price was HK$13.50 ($1.74) per share.

As of 12:30pm local time (+8 GMT) Alibaba.com shares were trading at HK$35.75 ($4.60), an increase of 164% on the list price.

Yahoo is a big winner from the IPO, having obtained a 8.2% stake pre-IPO that went from a paper value of $720.89 million to $1.9 billion based on the 12:30pm price.

Alibaba now has a market cap of a rather staggering $23.24 billion, significantly more than the market cap of China’s biggest search engine, the NASDAQ listed Baidu on $14.05 billion.

See our previous coverage here and here.

Update: Alibaba.com stock is now trading at HK$39.60 as at 3:40pm local time (2:40am EST). We’ll update again once the days trading closes in Hong Kong

Update 2: at the close of trade Alibaba.com stock was HK$39.50 ($5.09). Market cap is now $25.17 billion.

China’s high-flying Internet stocks are about to get a major addition when B2B marketplace Alibaba goes public on November 6. The IPO is on track to raise $1.5 billion for the Chinese Internet company, according to Bloomberg. That would make it the second-biggest Internet IPO ever, after Google’s $1.9 billion offering in 2004.

Alibaba, which was founded by Chinese celebpreneur Jack Ma, saw its profits rise 382 percent during the first half of 2007 to $39 million (or 292 million RMB), on revenues of $128 million (or 957 million RMB), a 61 percent rise. You can find the find the financials here. Alibaba’s main business is to function as a directory for Chinese manufacturers and other companies, and connect them to other companies around the world looking for suppliers. Alibaba also runs Taoboa, an eBay-like marketplace that is more for consumers and saw $2 billion worth of goods traded over its site the first half of this year; Alipay, the PayPal of China; Yahoo China (Yahoo owns 40 percent of Alibaba); and Alisoft, a Web-based accounting and management software for small businesses.

For a dose of competitive counter-hype on Alibaba, I asked the CEO of Atlanta-based manufacturing marketplace MFG.com, Mitch Free, for his take on Alibaba’s business prospects. (I’ve written about MFG.com previously here and here). Says Free:

There is not a lot of depth in what their business is doing. They are basically a directory and that offers limited value beyond supplier discovery. They will need to build or acquire the systems to truly facilitate industrial commerce and protect intellectual property. Bringing products to market is about more than just finding a supplier. Bringing products to market and sourcing the components requires a lot of collaboration, logistics, revision control, negotiation, due diligence, process and workflow integration.

Alibaba has done a great job selling listings to suppliers in China. However, Alibaba is virtually unknown within the industrial community in North America and Europe. In order for their model not to implode they will need to deliver value to their supplier customers in China. And for those customers, value for the money they spend with Alibaba will be judged by the new customer relationships they win as a result of being on Alibaba. Alibaba will also need to build a brand and value proposition with the industrial-buying community in North America and Europe. The challenge for them will be that those buyers have moved way past using directories and are looking for more transactional depth and process integration.

Conveniently, that is what MFG.com offers. And MFG.com, which is backed by Amazon’s Jeff Bezos, is entering China in a big way. So it is a potential competitor of Alibaba’s. But behind Free’s trash talking, there is some good analysis. He knows the manufacturing market well, and China is his biggest growth area. (If Jack Ma or someone else from Alibaba would like to respond, send me an e-mail to erick at techcrunch).

TechCrunch reported on Alibaba’s IPO earlier here and way back in July.

Chinese ecommerce company Alibaba.com is looking to raise HK$10.3 billion ($1.3 billion) from its IPO according to documents released to potential investors today.

Alibaba.com Ltd. and Alibaba.com Corp. will sell a combined 858.9 million shares (17%) in Alibaba.com at HK$10 to HK$12 apiece, with Yahoo, currently a 40% share holder in the Alibaba Group buying HK$776 million of the IPO shares, resulting in 8.2% ownership of Alibaba.com Ltd, the newly listed IPO entity.

As we reported in July, the IPO will see the partial spin-off of Alibaba.com from the Alibaba Group, the China based holding company that owns sites including Alipay, Taabao.com and Yahoo China.

The IPO will value Alibaba.com at up to $7.8 billion.

As Bloomberg reports, the Hong Kong IPO is likely to encourage other China based companies to consider listing locally as opposed to the NASDAQ only, where many leading Chinese ecommerce ventures are currently listed.

In related news, Baidu’s market cap has now passed $10 billion, up from $7.97 billion September 17. At close of trade 15 October Baidu stocks closed at $314.95 for a market cap of $10.69 billion, nearly double the market cap the company had in August.

Chinese ecommerce group Alibaba has confirmed preparations for an IPO of Alibaba.com.

Alibaba.com shares will be listed on the Hong Kong Stock Exchange in the third quarter and the IPO is expected to raise HK $7.8 billion (US $1 billion). Alibaba has said that they would be using the additional capital to expand their international footprint.

The IPO will see the partial spin-off of Alibaba.com from the Alibaba Group, the China based holding company that owns sites including Alipay, Taabao.com and Yahoo China.

Yahoo Inc is currently the largest shareholder of the Alibaba Group, having acquired a 40% stake in 2005.

(via cs.com.cn)