Chinese internet giant Alibaba recently announced that it plans to pour RMB 1 billion into mobile gaming distribution through its gaming unit Ali Gaming (阿里游戏) this year, in its renewed efforts to boost its presence in the booming gaming sector, local media is reporting (in Chinese).
The move came just days after the internet behemoth announced a strategic partnership (in Chinese) with its nearly half-owned film unit Alibaba Pictures to integrate its cultural and entertainment resources.
Alibaba’s gaming unit plans to invest RMB 1 billion to build a sound IP gaming ecology, together with the company’s literature unit Alibaba Literature, film unit Alibaba Pictures and video streaming unit Youku Tudou. In China’s entertainment arena, “IP”, short for intellectual property, refers to popular online novels or game titles that can be adapted to potentially successful TV dramas, or vice versa.
In addition, the gaming unit will collaborate with gaming distributors including Mail.Ru, ONEMT, TFJoy and Efun, to distribute homegrown mobile games outside of China and introduce foreign quality gaming titles to China.
Alibaba’s other units such as web browser UC Web, news app UC News and android app marketplace 9APPS, which have found popularity in foreign countries, will give the company’s gaming unit an edge in attracting traffic and marketing.
Another competitive advantage for the overseas expansion of the gaming unit is the company’s cloud provider Alibaba Cloud, which has had a presence in over 30 countries and has 13 data centers.
According to statistics, Tencent and NetEase are the two largest players in China’s gaming market, grabbing a combined 60% share in the first half of 2016, with Tencent taking in RMB 34.2 billion in revenue and NetEase RMB 12. 5 billion (in Chinese).