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Alibaba Mulls Yahoo China Future After Bing Deal

Alibaba Group, which controls the Yahoo brand in China, has not decided how to manage the search engine's algorithm after the tie-up between Yahoo and Microsoft's Bing, the group CEO said Friday.

Yahoo China is "tired" four years after Alibaba gained control of the brand, but it will be further integrated into the group in coming years, Jack Ma told reporters at a briefing.

"We will digest Yahoo China in our own way," he said.

Alibaba also has not decided on any changes to how the search algorithm for Yahoo China will be updated, he said. Part of a deal announced by Microsoft in July has slated the algorithm for its Bing search engine to power Yahoo search as well for the next ten years. The deal was called "global," but Microsoft would need a separate deal with Alibaba for Bing to power searches on Yahoo China, which is also called China Yahoo.

"So far we do not have a detailed plan on what we are going to do," Ma said.

The way the Yahoo China search algorithm is updated has not changed since the Yahoo-Microsoft deal, an Alibaba spokesman said, declining to give details.

Alibaba recently stripped a classified listings platform from the Yahoo China portal as part of a redirection for the site. Alibaba is also adding an entertainment focus to the portal in a bid to make it stand out from competing search engines.

Yahoo vies with local portals for the small slice of China's user search market that is not dominated by Google and Baidu. Alibaba grafted the Yahoo listings platform onto Taobao, an online auction Web site that is booming.

Ma said the way Alibaba integrates Yahoo China will be a "case study," but did not say how the portal may continue to change.

Yahoo gave Alibaba control of its brand in China in 2005, when it bought a 40 percent stake in the group.

Alibaba's relations with Yahoo frayed after Carol Bartz became CEO of the U.S. company and told Alibaba she disliked how the Yahoo brand was being treated in China, according to a source familiar with the situation. But Bartz said at a July conference that it wouldn't "make any sense at all" to try to buy the brand back or to "get rid" of Yahoo's stake in Alibaba.

"We have a bigger play just riding the fortune of Alibaba than we ever could being Yahoo China," she said.

Besides Taobao, Alibaba also runs an online payment platform and Alibaba.com, China's top business-to-business e-commerce site.

(Juan Carlos Perez in Miami contributed to this report.)

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