S.M. Entertainment strikes deal with Alibaba

SEOUL: One of the biggest record labels in the K-pop industry, S.M. Entertainment announced recently that it has formed a strategic partnership with Chinese e-commerce giant Alibaba.

Under the deal, Alibaba will buy 870,000 of S.M.’s newly issued stocks for 29.8 million US dollars, which means Alibaba will own 4 per cent of S.M.’s shares.

The company said that the agreement is expected to help SM expand into the mainland Chinese market, particularly in the music and marketing sectors and online music distribution. Under its Ali Music unit, Alibaba’s music apps Xiami and Tiantian may set up branded channels for some of SM’s groups.

Founded in July last year, Alibaba Music Group was as part of the Chinese group’s attempt to enter the online music industry.

China recently contributed significant growth to SM’s

The company said that the agreement is expected to help SM expand into the mainland Chinese market, particularly in the music and marketing sectors and online music distribution.

earnings, though that appeared to come from concerts and touring. The Alibaba deal could help to roll back piracy and allow SM to start earning significant revenue from streaming services. SM also has business deals with Baidu and Tencent.

S.M. Entertainment is home to a huge number of South Korean idol groups, such as EXO, f(X) and Girl’s Generation and superstar soloist BoA. It also manages actors while its Galeria label represents leading woman golfer Park In-bee.