Alibaba announces major long-term digital deal with Olympics

Chinese e-commerce giant Alibaba (BABA) is getting into the sports world.

On Thursday afternoon at the 2017 World Economic Forum in Davos, Alibaba and the International Olympic Committee announced a long-term digital partnership through 2028.

Alibaba will be the digital sponsor of the Olympics in three key areas: cloud services, e-commerce, and television.

Specifically, Alibaba will use its cloud platform to run the IOC’s digital presence “more efficiently and securely,” according to a press release; it will create a new global e-commerce platform for the Olympics; and it will help develop the IOC build its new Olympic television channel for a Chinese audience.

Alibaba becomes a member of TOP (The Olympic Partners), the IOC’s highest level of sponsors, a group that, for the Rio Olympics, included Coca-Cola, GE, McDonalds, Samsung, and Visa, among others. Alibaba is in fact the first sponsor now to sign on through 2028. That will cover the next three Winter Games and three Summer Games.

The two parties declined to say how much the deal is worth. (“I forgot it,” joked Alibaba CMO Chris Tung when asked in a later interview with Yahoo Finance.)

Jack Ma (L) of Alibaba and Thomas Bach of the International Olympic Committee exchange gifts at Davos after announcing long-term partnership.
Jack Ma (L) of Alibaba and Thomas Bach of the International Olympic Committee exchange gifts at Davos after announcing long-term partnership.

Alibaba executive chairman Jack Ma and IOC president Thomas Bach first met last year to discuss “how we can make the Olympics more digital,” Bach said. He praised Alibaba’s “first-in-class” cloud technology and said it will “transform the global Olympic movement” and “open for us the door to big data analytics.”

But “we don’t want to [just] be another sponsor to IOC,” said Daniel Zhang, Alibaba’s CEO. “We want to be a true partner to be a game-changer.”

It’s all part of Alibaba’s goal to “focus on happiness and health,” Ma said. “We believe we should make more young people join sports, and make the world happier. Olympic spirit is about teamwork, about working together, about a peaceful, fair, and nice competition. This is why Alibaba wants to join forces with the Olympics.”

In terms of technology, Ma added, “Of course we want to enable IOC, but also IOC is enabling us in our global dream.”

The press conference was extremely secretive; attendees at Davos knew ahead of time that Alibaba would be holding the conference, but not its purpose. “We’ve kept you in the dark for a while,” acknowledged an event organizer who introduced the panel.

This is the longest sponsorship deal any Chinese company has signed with the Olympics. “We are making sure this thing will work,” Ma said, adding that the deal is a “historic moment for Alibaba.”

In a later interview with Yahoo Finance, Timo Lumme, head of the IOC’s TV and marketing division, said that Alibaba will create for the Olympics, “a globally accessible e-commerce platform, which means that somebody in San Francisco can buy Tokyo merchandise, or somebody in Shanghai can buy Team USA merchandise. Alibaba’s going to help us reach those 700 million-plus online consumers in China who are wanting to be able to experience Olympic content on a day-in, day-out fashion.”

That’s part of why this is such a big deal for Alibaba: it’s the first time the Chinese giant will be offering e-commerce to Americans.

Thomas Bach of the IOC called the deal a “wedding.” As is Chinese custom, Ma and Bach exchanged gifts after announcing their news.

Disclaimer: Yahoo Finance is part of Yahoo, which owns a stake in Alibaba.

Daniel Roberts is a writer at Yahoo Finance, covering sports business and technology. Follow him on Twitter at @readDanwrite.

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