Yahoo Inc, owner of the world's most-used group of Internet sites, and Sina Corp, operator of the No. 1 Web site in China, said they'll form an online auction service for the Chinese market.
The service, available by the middle of this year, will carry the brand names of both Sunnyvale, California-based Yahoo and Shanghai-based Sina, the companies said in a statement, which didn't disclose terms of the agreement.
China's Internet trade between consumers and businesses will rise 77 percent this year to US$8.5 billion, market researcher IDC forecasts. EBay Inc, the world's largest Internet auctioneer, invested US$180 million in Eachnet.com, one of China's biggest auction portals, in the past two years.
"Online auction seems to be taken by Chinese Internet users quite well," said Nathan Midler, a Beijing-based analyst at IDC. "There are issues with security but it's taking off. Portals are trying to diversify into any area with revenue potential."
Sina chose Yahoo because of its experience running the biggest online auction sites in Hong Kong, Japan and Taiwan, an executive of the Chinese company said.
"Yahoo has the know-how given their exposure to the Asian market," Sina chief operating officer Hurst Lin Xinhe said in a telephone interview from Hong Kong.
There were 78 million Internet users in China at the end of last year, the companies said, citing a Chinese government agency.
China's economy grew 8.5 percent last year, its biggest gain in six years.
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