Alibaba has successfully established itself in the e-commerce industry and is now considered the largest e-commerce company in China.
More than just the desire to offer retail goods and services, the company is also looking into the entertainment industry as a way to meet the growing demand of Chinese consumers for video and other media content.
In about two months, Alibaba is set to launch Tmall Box Office (TBO), a paid video subscription service that aims to cater to such growing demand for content in China. The move will definitely boost the company's digital media presence in a country that is regarded as the third-largest market in the world in terms of media and entertainment.
"Our mission, the mission of all of Alibaba, is to redefine home entertainment," said Patrick Liu, head of Alibaba's digital entertainment. "Our goal is to become like HBO in the United States, to become like Netflix in the United States."
The new service will deliver content from within China and also from other countries. According to Liu, 90 percent of such content will be paid while the remaining 10 percent will be free.
Customers can either opt for a monthly subscription fee or pay for every show. Content will be delivered through the installation of smart TVs and set-top boxes that come with the company's software program.
"We want to create a whole new family entertainment experience," added Liu.
Alibaba also confirmed a number of deals that are in line with providing entertainment content in order to build a stronger presence in the industry. In 2014, the company offered a video subscription service through its Internet-run set-top box after a confirmed collaboration with Lionsgate.
Liu added that the company may also consider working with Hollywood as part of a possible venture into producing branded products that are worn by famous celebrities.
China's online video market is currently valued at a staggering $5.9 billion. The competition may be stiff since Alibaba's new service will compete against a number of companies that include Leshi Internet Information & Technology Corp Beijing, Sohu.com Inc, iQiyi, and Tencent Holdings, but the industry is also lucrative. Based on an analysis of Pricewaterhouse Coopers, a multinational professional services accounting firm, China's streaming video market could reach as much as $214 billion in value within only three years.
There's no information yet on how Alibaba's new service will convince users to sign up for a subscription. For its first offering, TBO will run a criminal drama TV show inspired by American-styled TV drama.
