Recently, I talked with a friend who knows Alibaba pretty well and I changed my mind about its investment in logistic. Earlier I believe it is just an idealistic plan. (http://en.technode.com/2011/01/24/alibabas-us4-5-billion-investment-in-logistic-just-a-plan-only/)

But in fact, Alibaba is working on something big. “The key is land,” said my friend. Alibaba is talking to local governments all over the country, asking them for land to build warehouses and logistic facilities.

“Once Alibaba gets lands from the government, they can borrow whatever they needs to build warehouses and logistic facilities from the banks, using the lands as collateral,” said my friend.

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Sherman So

Author of Red Wired: China's Internet Revolution, the first book to completely survey the nature of China's internet. (http://redwiredrevolution.com/) She previously was the lead China technology reporter...