Baidu, Alibaba Monetize Better on Mobile Than Google, Amazon, Morgan Stanley Says

NEW YORK (TheStreet) -- Chinese Internet companies and services are showing signs of better performance in certain areas compared with their U.S. counterparts, according to a new report from Morgan Stanley (MS).

The Morgan Stanley findings, which came out late Wednesday, were accrued at the brokerage's recent China Summit conference, which was attended by 223 Chinese companies from industries such as e-commerce, online travel and online advertising.

Mobility remains a central facet of Chinese e-commerce growth, as Morgan Stanley analysts said China's e-commerce leaders continue to derive more of their business from mobile usage than their American rivals.

According to the research, e-commerce kingpin Alibaba Group (BABA) says 51% of its business comes from mobile devices, while another sector leader, JD.com (JD), sees mobile commerce making up 42% of its business. And those rates pale compared to the 72% share of business that online discount retailer Vipshop Holdings (VIPS) takes in via mobile sources.

Morgan Stanley contrasted the Chinese e-commerce companies' figures with those of Amazon.com (AMZN) and eBay (EBAY), which receive about 35% and 40% of their revenue from mobile commerce, respectively.

In online advertising, Morgan Stanley compared the performance of Chinese Internet search leader Baidu  (BIDU) with that of Google  (GOOG). Again, the Chinese company's mobile business exceeds that of its American counterpart, with Baidu getting 50% of his revenue from mobile and Google claiming 30% of its search revenue from mobile devices.

Morgan Stanley also said that Baidu is looking at methods to improve its mobile device money-making, including the possibility of mimicking Google by charging premium rates for so-called "click to action" features. Baidu is also adding Google-like map functionality to its mobile offerings that includes services such as being able to order takeout food and buy movie tickets directly through smartphones and tablets.

When it comes to mobile messaging applications, the Morgan Stanley analysts said Chinese apps, for the most part, offer more functionality than the major U.S. offerings. Morgan Stanley noted that Tencent's (TCEHYpopular WeChat app gives users the ability to retweet messages with comments, access newsfeeds, and locate other nearby users, while such features are not available from Facebook's (FB) Messenger or the WhatsApp platform.

The Morgan Stanley findings on Chinese mobility and Internet usage came on the heels of a report from Kleiner Perkins Caulfield & Byers partner Mary Meeker on the growth of Internet and smartphone usage in China. Among her findings, Meeker said that the number of smartphone subscribers in China grew 21% in 2014 over the previous year.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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