Strategic soccer partnership links Le Sports, Ti’ao Dongli

2016-02-24 00:47:26 GMT2016-02-24 08:47:26(Beijing Time)  Global Times
Le Sports announced the establishment of a comprehensive strategic partnership with Ti'ao Dongli at the press conference held in Beijing on Tuesday. Photo: CFPLe Sports announced the establishment of a comprehensive strategic partnership with Ti'ao Dongli at the press conference held in Beijing on Tuesday. Photo: CFP

Le Sports, the sports arm of China's leading online video provider Le Holdings, announced on Tuesday the establishment of a comprehensive strategic partnership with Ti'ao Dongli, an arrangement that will see it explore a pay-to-watch model for the nation's top soccer league.

The agreement emphasizes cooperation in three major areas, Lei Zhenjian, CEO of Le Sports, said at a press conference in Beijing on Tuesday: cross-shareholdings in each other's company, exclusive online media rights to the Chinese Super League (CSL) and the exploration of a pay-to-watch model for the CSL.

"Together, the two of us will explore the broadcast globalization and innovative commercialization of the CSL based on the new mobile Internet platform, which will be an exemplary revolution for China's sports industry," said Lei.

Le Sports will obtain the exclusive new-media rights to the CSL for seasons 2016 and 2017 in the Chinese mainland, Hong Kong, Macao, Taiwan, the US, India, Singapore, Thailand, Canada and several Southeast Asian countries and regions. From season 2018 to season 2020, Le Sports and Ti'ao Dongli will jointly hold the CSL copyrights with the goal of launching a pay-to-watch model for the soccer league, according to a statement Le Sports sent to the Global Times Tuesday.

"The sports industry itself doesn't have many profitable models, but with the maturing steaming-video content, live broadcast platforms now have the possibility to make money," Chen Wei, an analyst with Beijing-based investment consulting firm ChinaVenture, told the Global Times, noting that Le Holdings has a relatively big base of paying customers.

The pay-to-watch model is the only way for China's sports industry to develop, Yu Hang, vice president of Le Sports, told the press conference, and professional sports should be supported by the high fees that broadcasters pay to stream games.

In October 2015, Ti'ao Dongli, a Beijing-based company specializing in sports events broadcasting, signed a deal involving the purchase of 5-year TV rights for the CSL at a record price of 8 billion yuan ($1.23 billion), the Xinhua News Agency reported. Xinhua noted that the TV rights for the 2015 season fetched only 60 million yuan.

A report by Beijing Business Today said Tuesday that the video company spent 2.7 billion yuan for two seasons of online broadcasting rights for the CSL.

Since the beginning of 2015, Le Sports has been actively engaged in financing and investing in media rights for sports events. Just last week, Chinese technology news portal sina.com.cn reported that the company just raised $1 billion in its series B financing round following its 800 million yuan series A financing in May 2015.

On January 25, the company announced plans to pay 39.2 million yuan for 56 percent of Sodasoccer, a Beijing-based soccer-oriented data company. And on January 28, it acquired sports broadcasting platform zhangyu.tv for 300 million yuan. In the same month, Le Sports renamed Beijing Guoan Football Club, a professional soccer club, as Beijing Guoan LeEco Team under a strategic partnership.

Other Internet companies have been betting big on sports. In late December 2015, Suning Commerce Group Co, an online and off-line appliance retailer, acquired Jiangsu Guoxin-Sanity Football Club.

In September 2015, Alibaba Group Holding set up a new sports business, Alibaba Sports Group, which is expected to integrate e-commerce, media, marketing, video, home entertainment and cloud computing to form a sports platform that will participate in different aspects of the professional sports industry. In June 2014, Alibaba purchased a 50 percent stake in Guangzhou Evergrande Football Club, another famed professional soccer club in China.

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Editor: Zhao Wei
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