Happy with all things "ali", Chinese Internet B2B firm Alibaba.com has launched Alisoft, an online business software provider to be established as a new company serving small and medium sized enterprises in China.

"E-commerce has become much more than just an additional sales channel for Chinese SMEs, it is the driving force behind their entire business," said Jack Ma, CEO of the Alibaba Group. "E-commerce is changing the way companies do business, from communications, to customer relationship management, to after sales services. Alisoft will provide easy solutions for customers to integrate e-commerce with their back-end systems."

The company says Alisoft developed out of Alibaba.com's e-commerce software center, a project founded in 2004 to create products tailored to SMEs engaged in e-commerce, will initially target the 18 million SME users of Alibaba.com's services.

SMEs represent a fast-growing segment of China's software market as more companies realize the advantage of using software applications to strengthen internal management and business competitiveness. However, among China's more than 40 million SMEs, Alibaba estimates that less than 10% have adopted advanced software applications, far lower than the average of 60% in the more mature Western markets.

Alisoft will also assume responsibility for the Alibaba Group's real-time business communications tools. To grow its leadership in this area, the Group's popular B2B and C2C instant messaging services will be merged into one service, under the name "Ali Wang Wang."

In less than one year of free testing, Alisoft's web based software services have attracted more than 500,000 active users and more than three million registered users. As a comparison, Salesforce.com, the current market leader in on-demand business services, has around 500,000 paying subscribers. Alisoft will begin to charge a fee for some of its business software services in the first half of 2007.

Alisoft will now become the fifth company in the Alibaba Group. Other companies include: Alibaba.com, the world's largest online B2B marketplace for global and domestic China trade; Taobao, Asia's most popular e-commerce website; Alipay, China's leading online payment service; and Yahoo China, a leading search engine and portal, acquired from Yahoo Inc. in October 2005. The combined group now covers all five pillars of e-commerce: trust, e- marketplace, search, payment and software.