Taobao, the operator of China's leading internet shopping portal, will invest 10 million yuan (HK$11.36 million) a year to expand its new business - an online store for retail software applications. The company said this would help fund efforts of small independent software developers to build programs for its eponymous App Store, at http://app.taobao.com , which was launched yesterday. Wang Wenbin, the vice-president of the Taobao Open Platform fund, said the online store would serve 'as an incubator of innovative technology' for the online merchants and consumers who use the mainland's fastest-growing online retailer. Privately held Taobao, a unit of e-commerce giant Alibaba Group, provides the most comprehensive product offering on the mainland online market and had served more than 170 million registered users as of the end of last month. A report from Goldman Sachs said the firm's high-turnover categories included garments, household products, mobile phones, consumer electronics and cosmetics. Wang said the new App Store would offer programs across a range of categories, including applications for sellers and buyers, tools to extend Taobao.com's community sites, tools for product recommendation and mobile-phone applications. Last month, Taobao teamed up with network operator China Telecom Corp and handset makers TCL Communication Technology Holdings and Lenovo Mobile Communications Technology to launch handsets custom-designed for e-commerce. Wang said software developers would be able to generate revenue from their applications through subscription fees, commissions or advertising. Goldman Sachs, which valued Taobao at US$8.7 billion, estimated the company had 80 per cent of the mainland consumer retail e-commerce market. By next year, Taobao's gross merchandise volume is expected to hit 400 billion yuan.