The world’s biggest online retailer courses with an unprecedented torrent of counterfeit and sham goods, and neither the big brands, the Chinese government nor U.S. pressure can do much about it.Jack Ma, the most powerful businessman in Asia, can. But shutting down the fakes would undermine his Alibaba empire.
Be warned: Jack Ma, the man who oversees the world’s largest online retailer and whom Forbes ranks as the 22nd most powerful person in the world, really doesn’t like lawyers. Especially those attacking the very underpinnings of the $200 billion empire he’s built. As rail-thin as ever, Ma almost leaps off the sofa in his Hangzhou office when talking about the fancy New York attorneys who have sued him for trademark infringement and trafficking in counterfeits on behalf of their client, Kering , the French luxury goods conglomerate that owns Gucci and Yves Saint Laurent. There’s no chance, he insists, of settling.
“I would [rather] lose the case, lose the money,” says Ma. “But we would gain our dignity and respect.”
That is true if he means respect in the eyes of the hundreds of thousands of small Chinese entrepreneurs who’ve made a living on Alibaba’s online bazaar, called Taobao. To Ma, whose Chinese retail sites handle five times the volume of eBay–last year $394 billion of, well, everything–these sellers are his lifeblood. To the sellers Ma is a hero of capitalism, offering them a path to the middle class. In the center of this social compact, however, is an unacknowledged truth: The Alibaba juggernaut has been constructed to a significant degree on illegal, counterfeit products.