Davos 2017: An Insight, An Idea with Alibaba Founder, Jack Ma (Transcript)

Interviewer: One of the critiques as you know and it continues to linger around Alibaba is the piracy issue. There’s an IP issue and it’s an issue all over China but you take the brunt of a lot of it. How much progress have you made in your mind and how do you think about some of the regulatory bodies in other countries, including the U.S. that continue to criticize Alibaba for these issues?

Jack Ma: First, when we start doing this business, as a business like this size, you have to take all the criticism. You have to listen what is right, what is wrong. And second, as an e-commerce when you put 10 million small businesses, empower them to sell, we do not like Amazon buy. We cannot check — even you buy, when you buy $55 trillion or $550 billion you cannot check every product. So the model itself and the e-commerce itself may have a lot of these frauds. And third, I would say in the past 17 years, we are the leader of these anti-privacy issues — protect IP.

But the second, we are Internet companies, we do not have the law enforcement. We find this guy is selling product, cheap fake products, we delete them, we cannot arrest them. But with a huge progress, last year alone, we put 400 people into jails. We deleted 370 million fake products listing on our site. I would say we are the leaders and we are using the big data to check out who’s buying, who’s manufacturing, who’s selling, what is the address. So now I’m happy about the whole world, especially China, all the government organizations, start to realize the issues. So I would tell you good thing is that today when you go to those criminal groups, which I call them criminals, those fake products manufacturers, sellers.

Interviewer: You praise the quality, though, of some of these?

Jack Ma: I would talk about later, right? Those criminals said they can go anywhere but not on [Timo] because using our data would trace where they are, who they are, what’s the address, what the amount. And we’ll deliver this to the police station and are working with them to arrest them. The quality issue is something I want to share with people. It’s not by praising the fake products. I want to say that for so many years, those branded companies you have to be very careful because the fake products, their quality improving is scary. That is the difference between us, because when you find the guys, the thing the people said this is fake and you have to find people — you have to find a third party institution to check if it is a fake or not. We find, sometimes, the quality is better.

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And I tell you another thing is even scarier, a lot of — there is a one branded company. He said we are selling fake products, we check everything. It’s nothing wrong. So we said, what is wrong, so we buy the products from his fake shop and deliver to them. This is a fake. You know what I am saying. We buy, shop — buy things from the fake shop of this brand and deliver back. It’s the fake products they say. So it’s a big confusing. This is fighting against the fake products, it’s the war against the greedy, human greediness It’s not easy. You cannot finish it. But you have to continue to fight. And I want to say we put 2000 people, 1 billion RMB every year fighting again that, we can never finish the work within two years. But I’m happy where the people criticize me, criticize us, the most important is that we are happy about the progress we’ve made.

But if people praise me, so you know, when people say, ‘Jack, you are wonderful’, I know I am not wonderful, right? Alibaba is great, we’re not great. We’re just a 17-year old company. But when people say ‘you’re doing nothing’, No, we’re doing a lot of things but you don’t have to argue, you don’t have to debate. You do what you believe.

Interviewer: One of the things you mentioned was using big data on the piracy side, but the other thing that you’re using a lot of that big data to do is provide credit and effectively banking the unbanked. And what’s so fascinating to me and I hope you’ll share it, as we’ve talked about the sesame credit, how you are able to use big data effectively to figure out who deserves credit and who doesn’t in a marketplace where some of these people had no credit history before?

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Jack Ma: OK. Well, before we do that, we had a system called teach computers to learn how to anti-fake products, teach the computers learn how to — because we have Alipay, a lot of people try to use all the ways to cheating. So we teach the computer how to do that, the cheating things. So we’ve been doing that for 10 years, until now there is called artificial intelligence, because we’ve been doing that. We are a data company. Eight years ago we said to ourself Alibaba should not be an e-commerce company, we should be a data company, because we have the data from consumers, we have data from the manufacturers, we have data from the logistic companies and transactions. But we think how we can make the data really beneficial to the society.

What China need is that we have a lot of great people, all the small business, they have a very — they’re very credible but we don’t have a credit system for that. So how can we use a credit rating system based on the data we have to giving everybody a sesame rating system? That is so powerful in the past four years, because every individual, every small business, if they have been using our services, we’ve given a rating system. So we’re giving loans. In the past five years we’ve given 5 million business loans. They only borrow $5000. Three minutes, we can decide whether we should give you money, how much we want to give. Within one second, the money will be in account and zero people touch. So we call it three-one-zero. And even today the sesame rating system becomes people dating. The mother-in-law wants to say, ‘Hey, you want to date with my daughter? Show me your rating system of the sesame card?’

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