Alibaba (NYSE: BABA) recently announced that it has acquired a minority stake in Steven Spielberg’s Amblin Pictures, which is formerly Dreamworks Studios. This partnership highlights Jack Ma’s digital strategy and the international appeal of Hollywood.
The Chinese ecommerce giant focuses on content that it can include into its offerings, such as TMall Box Office subscription service and online streaming platform Youku Tudou.
According to Wedbush Securities analyst Gil Luria, “They have decided to go well beyond their core e-commerce business.”
“They have a multi-screen strategy where they want to participate in every different screen the consumer is going to go to,” Luria further stated.
Alibaba’s strategy is intended to bring fresh content to its online platform and grow its ecommerce reach to new outlets.
According to the analyst, “They have the ability to use that content to get more engagement form the consumer through watching videos, but also open up abilities to do commerce on different screens that are not desktop or mobile, such as a television.”
Alibaba made a major move into China’s media industry back in 2014 when the ecommerce group invested around $804 million to boost its position in ChinaVision Media Group. The business, which is now called Alibaba Pictures, is currently trading publicly Hong Kong.
Alibaba Pictures has backed several projects of Paramount Pictures, including Star Trek Beyond, Teenage Mutant Ninja Turtles: Out of the Shadows, and Mission Impossible: Rogue Nation. Earlier in 2016, shareholders of Viacom (the parent company of Paramount Pictures) had urged the media group to consider selling a stake of the studio to Amazon.com or Alibaba.
The President of Alibaba Pictures Zhang Wei stated, “There is a lot of hot money from China floating around Hollywood right now, and we’ve had quite a few people approaching us about wanting a partnership.”
Studios are seeking funds and aid in penetrating the Chinese market.
Companies in China are not the only ones which are showing their interest. The former Al Jazeera unit beIN Media acquired the parent of Miramax earlier in 2016.
The collaboration between Alibaba’s Jack Ma and Steven Spielberg is getting right to work this weekend. The Chinese film company under Alibaba Group will market and distribute The BFG, beginning with its release in China this Friday. The BFG is a fantasy-adventure film, which Spielberg’s Amblin Pictures co-produced with Walt Disney.
As of 4:05 AM GMT-4 on October 11, the BABA stock is changing hands at $108.41, up by 2.27 percent or 2.41 points.