EBay launched its own classified listings company in China, Kijiji, in March 2005 in China.

"Kijiji is doomed in China, because once again it's an example of where eBay has failed to create a strong local product ... Koubei is a real community that's really growing and has momentum, whereas eBay wants a one size fits all, and in China you can't do that," Erisman said.

An eBay spokesperson reached by phone declined to comment.

Alipay last week launched a card with China Construction Bank Corp., which can be used to buy online from Taobao.

The number of consumer-to-consumer e-commerce users came to 22.45 million in 2005, data research firm iResearch said in a note this month, and grew at as fast as around 73 percent per year on average between 2001 and 2005.

IResearch has also estimated that eBay, which dominated China's online auctions market with 79 percent of the market in 2003 before Taobao's launch that year, had seen that share fall to 36 percent last year versus Taobao's 59 percent.

China has the world's second-largest Internet population after the United States with more than 120 million users.

Alibaba absorbed Yahoo's China business last year and Yahoo Inc. bought a 40 percent stake in Alibaba.

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