Alibaba Pictures Group Ltd., a subsidiary of Chinese e-commerce leader Alibaba Group Holding Ltd. (NYSE:BABA), has recently entered into an investment agreement with Paramount Pictures’ “Star Trek Beyond” and “Teenage Mutant Ninja Turtles (TMNT): Out of the Shadows” as part of its initial efforts to enter the Hollywood.
Financial terms of the agreement have not been disclosed. However, Alibaba Pictures Group said that both motion pictures would be imported in China, the world’s largest economy, under a revenue sharing quota scheme. Accordingly, the films will be released by the second semester of 2016 through China Film Group Corporation and Huaxia Film Distribution Co., two Chinese state-owned distributors. Furthermore, Alibaba’s Taobao Movie and Yulebao will likely give the release of the motion pictures the much-needed marketing boost.
Paramount Pictures Investment
Last year, the company began its series of investment in Paramount Pictures with “Mission: Impossible— Rogue Nation”.
Zhang Wei, Alibaba Pictures Group President, said that the company had a smooth-sailing working relationship with Paramount Pictures. This is why Alibaba Pictures Group is delighted to be working once again with the Hollywood production arm of Viacom, Inc. (NASDAQ:VIAB).
Rob Moore, Paramount Pictures Vice Chairman, explained that the collaboration with Alibaba Pictures Group has strengthened its impact globally.
Alibaba’s Strategical Expansion
According to Alibaba, globalization is one of the main goals of Alibaba Pictures Group as it consolidates resources to compete in the global entertainment business. Over the years, the e-commerce company has devoted its resources in expanding its range of ventures, which include its entry in online food delivery and sports.
The diversification of Alibaba’s business portfolio has continued to become a significant part of its growth around the world— not only in China. With the latest investment on the Star Trek and TMNT franchises, Alibaba is taking advantage of the booming Chinese market for American motion pictures. According to reports, about 12% of the total gross of the franchises’ previous releases can be attributed to China.
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