Alibaba eyes a slice of smart city pie

The smart city platform of Alibaba Group Holding Ltd shown on a smartphone. The company plans to provide mobile public services in 50 cities by the end of this year, which could cover 100 million people. [Photo/China Daily]

Alibaba Group Holding Ltd on Wednesday made its biggest step to facilitate the government-backed smart city projects in which Tencent Holdings Ltd, its strongest rival, is also eyeing a piece.

The e-commerce giant's finance arm said it will partner with the country's largest microblogging platform Sina Weibo and Taobao.com, a retail site of Alibaba, to help local governments' efforts to improve administrative efficiency and transparency.

"We are looking to leverage on Internet and cloud computing to offer one-stop solutions for building smart cities," said Fan Zhiming, president of Alipay Zhejiang Ant Small and Micro Financial Services Group Co Ltd, which runs the mobile payment platform Alipay.

"We are planning to provide mobile public services in 50 cities by the end of this year, which could cover 100 million people," Fan said.

Under the partnership, some administrative services will be moved to Alipay, Weibo and Taobao.

Users of these three mobile applications will be able to make hospital appointments, check for traffic tickets, pay utility bills and other services. Aliyun, the cloud computing arm of Alibaba, will also help local governments build unified cloud systems to tap the value of massive data.

The service is currently running in 12 cities, including Shanghai and Guangzhou, the company said. Alipay has 270 million active users and Weibo, in which Alibaba has an 18 percent stake, has about 176 million users.

It is the latest move by Alibaba to deepen its involvement in the administrative sector, putting the company in direct competition with Tencent, which has also teamed up with local governments to offer similar services via its popular instant messaging application WeChat.

Earlier this month, Tencent said its smart city project has already covered more than 60 million people in five cities, including three that Alibaba is also setting foot on.

The Internet firms' growing interests in the smart city projects came after Premier Li Keqiang urged local governments to take advantage of the Internet and cloud computing to improve work efficiency.

The Internet companies are pouncing at the opportunity to further diversify their mobile offerings into multiple areas, analysts said.

Tencent and Alibaba hope that making public services accessible on mobile platforms could help boost the user base of their mobile apps.

Looking forward, the smart city initiative demands more cooperation among Internet companies, said Ding Baogui, a senior researcher at consultancy IDC.

"The smart city initiative is a massive project for a single company. Instead of turning against each other, they need to make joint efforts to complete the project."