BEIJING--Amazon.com Inc. (AMZN) said Monday it opened a new
Chinese-language application store, a move analysts say could
presage the introduction of the company's tablets and e-readers in
the country.
The store offers applications running Google Inc.'s (GOOG)
Android operating system, including many of the most popular
Chinese social-media and gaming applications, a company spokesman
said.
With the new store, which allows users to download free
applications or pay for software, Amazon becomes the first major
U.S. company to offer a for-pay Android application store.
Amazon has recently been making a push to expand its offerings
in China, first launching an online bookstore and then offering
cloud storage services. Amazon doesn't yet sell its Kindle or
e-readers in China, though many have tipped the company to begin
selling its hardware in China soon.
Although Amazon has run an e-commerce operation in China for
years, it has failed to build up a significant market share as
local competitors like Alibaba Group Holdings Ltd. and Beijing
Jingdong Century Trading Co. have outcompeted it in attracting new
customers. Last year, Amazon's head of operations in China, Wang
Hanhua, stepped down after seven years with the company.
The new Amazon China store also underscores the continuing
difficulties that Google is having in the country, which last year
became the world's largest smartphone market.
Although Google developed Android, which had a more than 80%
market share in China at the end of 2012 according to Beijing-based
research firm Analysys International, difficulties accessing Google
Play, its application store, has led users to rely on a number of
alternative stores run by local Internet companies and telecom
carriers. Analysts say the difficulties with Google Play are due to
government blocks on the site.
Google's services in China have often been slow and unreliable
since the company declared in 2010 that it would no longer censor
Internet searches as required under local law and shifted its
search operations to Hong Kong.
Though Amazon is a small online services player in China, the
store could help it attract users. With the proliferation of
Android application stores in China, the quality control over the
applications offered in the stores has lagged, and users and
regulators report difficulties with pirated software, spyware and
viruses. If Amazon offers a trustworthy site, it could help it to
attract customers looking for a safe way to get popular Android
applications.
Nonetheless Amazon faces competition from China's largest
telecom carriers, like China Unicom (Hong Kong) Ltd. (076.HK, CHU)
and China Telecom Corp. (0728.HK, CHA) , which each offering their
own application stores. Chinese Internet companies like Qihoo 360
Technology Co. (QIHU), UCWeb, Tencent Holdings Ltd. (0700.HK,
TCEHY), and Baidu Inc. (BIDU, K3SD.SG) also all offer popular
application stores.
Write to Paul Mozur at Paul.Mozur@dowjones.com
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