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TheStreet Open House

Will Success Spoil Alibaba?

It already fills Amazon's cloud computing niche with Aliyun. It fills the niche of eBay's (EBAY) Paypal with Alipay. It has its own version of Groupon (GRPN). It has its own version of Priceline (PCLN) or PriceGrabber. 

Does it really do all of these things well? Will it be allowed to keep dominating its home market at the same time it attacks the European and U.S. markets?

Alibaba does offer one service that is unique: its original niche. That is its business-to-business service, Launched in 1999, at the height of the dot-com mania, Alibaba is likely to remain unassailable as a business-to-business site, the best way for U.S. retailers to acquire imported goods efficiently.

Its slogan: global trade starts here.

If your little cooking shop wants to get in on the new craze for rock salt, you can order it in lots as small as 200 through, a Pakistani company, on Alibaba.

That's a unique niche. That's a company worth buying and holding on to.

The rest of Alibaba is a speculation. Can Alibaba get you goods faster than Amazon? Maybe if you live in Chengdu. Can they do it if you live in Seattle or Chicago, or Liverpool or Leeds? How about their other e-commerce markets -- can they keep Amazon out while growing their U.S. footprint?

Will Alibaba remain on cozy terms with China's leaders? Do you want to put money at risk betting on that?

Stay tuned.

At the time of publication, the author owned shares in AMZN, YHOO and GOOG but held no positions in any of the other stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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