Chinese tech giant Alibaba showed it's not just Meta, Google and Amazon that can use their financial heft to buy a foothold in the developing world by striking a deal with Indonesian superapp firm GoTo Group.

On Tuesday, Alibaba announced [PDF] that GoTo would use Alibaba Cloud services - including cloud-native database, networking, security and data analytics - while Alibaba would commit to holding onto its GoTo shares for at least five years.

Alibaba Group held 88,531,124,993 Series A shares in GoTo as of the end of August - roughly about 7.4 percent of the business. In February, before Alibaba sold 16.29 billion shares, that percentage was around 8.7 percent.

"The services will bolster GoTo's platform services and digital innovation with Alibaba's advanced cloud and AI technologies," stated Alibaba. GoTo Group CEO Patrick Walujo claimed the move would strengthen the firm's technological infrastructure.

Alibaba called the non-binding memorandum of understanding one of its "most significant strategic cloud engagements in Southeast Asia."

Alibaba won't just have its hands in GoTo's infrastructure. It will also engage in other vague initiatives like digital and AI skill development, and non-specified "further commercial partnerships" that it claimed will contribute to Indonesia's digital economy.

GoTo itself is the result of a 2021 merger between ride-hailing app Gojek and e-commerce platform Tokopedia.

Last December, Chinese tech giant Bytedance's TikTok bought a $1.5 billion chunk of GoTo. That strategic e-commerce partnership was enough to convince the Indonesian government to let TikTok engage in social commerce in the nation - even after it issued a ban on the practice.

Tokopedia is now TikTok’s "Shop" service in all but name and branding, noted Singapore-based consultancy Momentum Works.

Between TikTok and the Alibaba deal, GoTo has become integrated with Chinese infrastructure and technology - which likely suits Beijing just fine.

In June, China's Ministry of Commerce called for massive expansion of the nation's cross-border e-commerce industry, typified by the successes of Chinese brands like Temu, Shein, and TikTok Shop. It's also known to be thrilled at the prospect of inserting infrastructure into emerging markets.

It would be remiss to say such moves are confined to China. Western Big Tech outfits have also found ways to "invest" in other nations. For example, Google invested $4.5 billion in India’s dominant mobile carrier Jio Platforms in exchange for a 7.73 percent stake. Jio then created an entry-level Android smartphone - the roughly $85 Jio Next - and made the device its flagship. The move saw many Indian citizens use more online services - including Google’s products.

Meta's has also teamed with Jio, launching of an end-to-end e-commerce service tied to its WhatsApp messaging app.

GoTo and Alibaba remain impactful, but both have seen less than stellar performance of late. GoTo has generally been unprofitable and had to exit markets like Vietnam and Thailand after failing to get a foothold in market share. As for Alibaba, its stock price has significantly declined.

Alibaba has looked to remedy its conundrum through overseas expansion. GoTo predicts it will experience positive revenue this financial year. ®

https://www.theregister.com//2024/09/18/alibaba_goto_mou/