Alibaba has signed a deal to sponsor the next six Olympic Games, in a move expected to deliver at least $600m into the coffers of the body that runs the world’s biggest sporting event.
The Chinese ecommerce group joins an elite corporate list that includes McDonald’s, Coca-Cola and Visa as part of the International Olympic Committee’s worldwide sponsorship programme.
Under the terms of the deal unveiled yesterday, Alibaba will also provide technology services to the games organisers and establish the Olympic Channel, a digital television service intended to promote the games to younger sports fans. Alibaba said it would help tailor the channel for Chinese audiences.
Founder Jack Ma said that Alibaba would use its technology to help “evolve the Olympic Games for the digital era”. The top tier of Olympic sponsors has long been dominated by western groups and has only once included a Chinese company - PC maker Lenovo, during the 2008 Beijing games.
But the IOC, the games’ governing body, has been seeking to build ties with Asian sponsors to help promote its events worldwide. Asian cities Pyeongchang, in South Korea, Beijing and Tokyo will host the next three Olympic Games - two winter events and one summer.
Details of Alibaba’s agreement, which runs until 2028, were not disclosed. But a person familiar with the negotiations said the deal was worth $600m, a figure in keeping with existing arrangements.
According to forecasts from the IOC, its top 12 sponsors provided revenues of just over $1bn for the 2014 winter games in Sochi and this year’s summer games in Rio de Janeiro. Overall revenues from broadcasting rights and other commercial deals, which the IOC splits with host cities, netted $5.6bn over the same period.
Alibaba’s Olympic deal echoes moves by other Chinese groups, which have invested billions in sports companies, European football clubs and media rights agencies over the past two years. The spending spree was sparked by President Xi Jinping’s call to transform China into a “great sports nation”.
The deal with Alibaba may also help ease the pressure on Thomas Bach, IOC president, who has tried to make hosting the games more affordable. A number of would-be hosts, including Oslo, Rome and Boston, have withdrawn their bids for future games, citing the prohibitive cost.
