$1.7 trillion in fake goods: That's Alibaba's uphill battle

SAN FRANCISCO — Shopping might be easier thanks to the Internet, but so is getting duped by counterfeiters.

Chinese online shopping giant Alibaba announced Monday that it has formed a coalition that will leverage the power of big data to crack down on purveyors of fake goods, whose value in 2015 exceeded $1.7 trillion, according to the International Anti-Counterfeiting Coalition.

U.S. companies suffer most at the hand of brand pirates, with one in five knock-offs infringing on American products, and 63% of counterfeit goods come from China, according to the Organization for Economic Cooperation and Development.

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The mission of the Alibaba Big Data Anti-Counterfeiting Alliance, whose 20 members include luxury brands such as Louis Vuitton and Swarovski, is to pool information, data and expertise in intellectual property authentication with the ultimate goal of "helping block, screen and take down infringing listings," according to a statement from Alibaba.

“The most powerful weapon against counterfeiting today is data and analytics, and the only way we can win this war is to unite,” said Jessie Zheng, Chief Platform Governance Officer of Alibaba Group.

Alibaba, which sells 14.5 billion items a year to Amazon's 5 billion, according to courier ParcelHero, has been aggressive about using data analytics to put counterfeiters out of business.

Its software currently scans 10 million product listings a day. In the 12 months ending last August, the company closed down 180,000 third-party stores for trafficking in fake items. During that same period, Alibaba provided sufficient information to brands and law enforcement agencies to close 675 counterfeit goods manufacturing operations, the company said.

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According to the OECD's 2016 report, "Trade in Counterfeit and Pirated Goods: Mapping the Economic Impact," brands most affected by counterfeiters include Rolex, Ray-Ban, Louis Vuitton and Nike. In fact, footwear tops the categories, followed by clothing, leather goods, and electrical equipment.

Alibaba's executive chairman, Jack Ma, recently traveled to New York City's Trump Tower to meet with President-elect Trump. Ma has pledged to create one million U.S. jobs by growing trade between small U.S. businesses and Chinese consumers.

Amazon recently announced plans to create 100,000 U.S. jobs over the next 18 months. Most of the positions will be at fulfillment centers, including new facilities under construction in California, Florida, New Jersey and Texas. The new employees will also work in areas such as cloud technology, machine learning, and advanced logistics.

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