Alibaba's Ma said to be seeking Hollywood content

Updated: 2014-10-24 07:33

By PAUL WELITZKIN in New York(China Daily USA)

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Jack Ma, who won over Wall Street with the IPO of his online retailing giant Alibaba last month, may be seeking to put Hollywood on his company's Internet set-top boxes in China.

Ma and a team of his executives will visit with the heads of a number of entertainment studios in coming days to get distribution rights for their content and possible stakes in their studios, Bloomberg News reported Thursday, citing people with knowledge of the situation.

Alibaba would be following its US counterpart Inc. in offering original programming, said Jack Liu, senior vice-president at Chardan Capital Markets in New York. Amazon has added original television shows to its Prime Video on-demand service.

"Because of its vast database of consumer transactions, Amazon has developed some unique insights into consumer behavior and tastes," Liu told China Daily on Thursday. "This enables the company to develop media content that is likely to draw a large audience. Alibaba will probably be able to do the same thing with its database in China. Providing original programming is really a natural extension of the online retailing platform."

Bloomberg News said that Ma will meet with Lions Gate Entertainment Corp, Walt Disney Co, Viacom Inc's Paramount Pictures, Time Warner Inc's Warner Bros, Sony Corp and Comcast Corp's Universal.

Alibaba raised nearly $22 billion in an initial public offering of stock on the New York Stock Exchange in September and is exploring ways to deploy the capital.

Liu said online content distribution will probably start out as a small part of Alibaba's initial strategy. "It will become one of the company's key strategies, but it won't represent a large percentage of the sales until later on."

For US studios, Alibaba would be a reliable partner that could provide efficient access to the Chinese market, he said.

"Although foreign content attracts a small percentage of the viewing audience in China, it is growing, especially US movies and shows which are very popular with young people," said Liu. "Alibaba could become a trusted partner for the US studios and give them a secure way to distribute their content in China."

This wouldn't be the first time Alibaba has expressed an interest in the entertainment industry. Earlier this year the company acquired a majority stake in Hong Kong-based ChinaVision Media Group, which produces Chinese-language TV shows and movies. Alibaba and founder Ma's Yunfeng Capital paid $1.22 billion for a stake in the Chinese online video firm Youku Tudou Inc, and in April agreed to purchase a 20 percent stake for $1 billion in the Internet TV company Wasu Media Holding.

Flush with a growing consumer market and cash for investments, China is eager to gain a foothold in the global film and video production industry. Dalian Wanda Group Co Ltd said earlier this month it would invest one billion yuan (US$163.4 million), to bring movie and television production to a planned multibillion-dollar studio project it's developing in the Chinese coastal city of Qingdao. Wanda also owns the US theater chain AMC Entertainment Group.

Earlier this year Chinese conglomerate Fosun International acquired a stake in the US media company Studio 8 to bring Hollywood's know-how to China's film industry, now the second-largest market in the world after the US.