July 20 (NBD) -- Alibaba Group announced Tursday astartegic investment in Suning Sports, the sports unit of Suning Holdings Group, a move seen as accordant with the e-commerce giant's ambitions in sports industry.

NBD noticed that Suning Sports has raised around 600 million U.S. dollars in its Series A financing round led by Alibaba Group and Goldman Sachs, and the sports firm is now valued at more than 10 billion yuan (1.5 billion U.S. dollars).

Other investors in the financing round include Chinese property developer Evergrande Group, Yunfeng Capital, Chinese AI company Sensetime, Sports Industrial Fund of Zhejiang Province and Sports Industrial Investment Fund of Jiangsu Province. 

The new collaboration between the two parties will combine Suning's complete sports industry ecosystem with Alibaba's consumer base in the pan-entertainment field.

According to Mi Xin, vice president of Suning Sports, the company's business will include 4 parts, sports media business, over-the-top (OTT) business, sports retail business, and sports training. Suning Sports now owns Jiangsu Suning Football Club and Football Club Internazionale Milano.

PPTV, Suning Sports's new media unit, provides live stream for over 800 sports games every year, including European top leagues, Chinese Super League, AFC Champions League, UFC, WWE, China Volleyball League, the sports media company said.

As part of the agreement, Youku, the flagship video streaming platform owned by Alibaba, will team up with PPTV. While PPTV will provide sports contents, Youku will focus more on producing pan-entertainment contents related to sports. Besides, the two platforms plan to establish a connected membership system. 

In May this year, Youku announced partnership with China Central Television to streaming 2018 FIFA World Cup, which makes it the first Chinese online video platform to do so.

From June 15 to July 15, more than 180 million users watched the World Cup via Youku, 24 million of which watched the final, revealed Yang Weidong, president of Youku and Ali Music.

Data shows that the number of Youku app's daily active users has surged 22 percent during the World Cup period compared to the metrics during June 1-13. 

However, the profit model for sports streaming remains unclear in China. The World Cup made contributions to the increase of users, but Youku didn't gain profits in the World Cup, Yang Weidong noted.

But both Youku and Suning Sports seemed bullish on enormous potential in Chinese sports industry. Mi Xin held that China's sports market still has much space for development. 

According to a report on Chinese sports industry released by the General Administration of Sports of China, the number of pan-sports fans in the country has reached 600 million, including 300 million football fans, 200 million audience of sports games and news, 100 million users watching online sports videos and 37 million football lovers.

By 2020, the market size of Chinese sports industry will surpass 3 trillion yuan (443.3 billion U.S. dollars), and industry practitioners will total over 6 million.

In an effort to explore the market, the two firms are expected to deepen cooperation in domains such as sports marketing, advertisement service, sports community and sports training.

Email: zhanglingxiao@nbd.com.cn