Alibaba, China’s largest e-commerce company, is looking for potential investments in Hollywood films, in a move to expand the site’s content offering.
The Hangzhou -based company completed the world’s largest IPO (initial public offering) in September and is searching for movies and television shows to invest in, to expand the site’s entertainment content to cater for China’s expanding middle class of about 200 million people. Alibaba launched Yu Le Bau in March, a platform on which users can invest in movies.
Yu Le Bau gives people the opportunity to invest as little as 100 yuan (approximately R184) and receive annual return rates of about seven percent on each investment made. Investments can also give Alibaba indicators of which movies people want produced and therefore forecast which movies will make the most sales and do well at the box office. The content firm is also currently distributing its own selection of films and TV shows through its set-top boxes, which convert digital TV signals to analogue for viewing on conventional TV sets.
The Chinese are serious about cashing in on a stake of Hollywood’s billion dollar earnings and Alibaba’s move is merely a continuation of the trend of Chinese investors playing an active role in the making of Hollywood productions. Last year, DMG Entertainment (a company based in Beijing) co-produced Iron Man 3 with Walt Disney’s Marvel Studios. The film was the most popular imported movie in China in 2013; with an edited version released there which contained additional footage from China and highlighted Chinese local talent. Additionally, the China Movie Media Group entered a marketing agreement with Viacom’s Paramount Pictures for Transformers: Age of Extinction, which set the record for the highest-grossing debut of a foreign film in China and earned US$301 million this year.
The Chinese are also scouting local talent to take part in Hollywood-based co-productions in reality shows and local completions and it appears that the market is particularly interested in action-adventure movies. It has become common-place to see the words “Made in China” on articles and the same may soon ring true for film productions as the Chinese are creating a new standard of quality and modernism in their film partnerships.