China-based Alibaba Group, which operates ecommerce sites, has officially launched an online advertising exchange Alimama (www.alimama.com). The ad exchange allows web publishers and advertisers to trade online advertising inventory. Alimama is a wholly owned subsidiary of Alibaba Group and is designed to help small- and medium- sized web publishers monetize the estimated 80% of web site traffic which goes unmonetized in China.

Porter Erisman, Vice-President of Corporate Affairs for Alibaba Group, said Alimama complements Yahoo China. Advertisers will be able to buy advertising on Yahoo China (and other portals) through Alimama's platform. In addition, Yahoo China can also buy advertising through Alimama in order to grow its business.

Erisman said Yahoo China does not offer an ad exchange, so there are no areas of competition. "Because Alimama is focused display advertising, it is not in direct competition with search advertising," he said.

Alimama launched in beta on August 10 and has signed up more than 150,000 small- and medium- sized web publishers and 135,000 personal blogs, covering more than 1 billion page views per day. The exchange has over one million registered users with an inventory of more than 380,000 advertisement positions available for purchase, with transactions for more than 20,000 advertisement positions occurring each day. Alimama is adding 4,000 small and medium sized websites and 10,000 personal blogs each day.