Alibaba Pens $590m Partnership To Launch Into Smartphone Market


Chinese ecommerce giant looks to boost the reach of Aliyun mobile OS with Meizu tie-up

Alibaba has signed a landmark deal to extend its business into the smartphone market.

The e-commerce giant has announced it will be investing $590m into Chinese manufacturer Meizu as it looks to further its reach into the mobile market.

Under the terms of the deal, Alibaba will buy an unspecified minority stake in Meizu, which currently controls around two percent of the Chinese mobile market, shipping a company record 1.5 million smartphones in January 2015.

The company will then use Meizu devices to help push its struggling own-brand Aliyun operating system, which provides easy access to Alibaba’s range of successful retail operations.

Meizu MX4Expansion

“The investment in Meizu represents a significant expansion of the Alibaba Group ecosystem and an important step in our overall mobile strategy as we strive to bring users a wider array of mobile offerings and experiences,” said Jian Wang, Alibaba’s CTO, in a statement.

Meizu is one of only two manufacturers to manufacture device that run on the open-source Ubuntu platform, alongside BQ, which released the Aquaris E4.5, the first smartphone running on Ubuntu Mobile, last week.

Positioned as an alternative to the ‘status quo’ of Android and iOS for both consumers and developers, the launch was hailed as an “amazing milestone” for Ubuntu Mobile and  Canonical claims the platform will offer a more “Richer, faster, unfragmented experience” than alternatives.

“Alibaba Group will provide Meizu with resources and support in the fields of e-commerce, mobile Internet, mobile operating system and data analysis with the aim of developing Meizu’s smartphone ecosystem,” the company said in an announcement, which also stated that Meizu phones (such as the MX4, pictured above) will now be sold via Alibaba’s range of online retail sites.

China is the world’s largest market for the devices, with shipments last year hitting 389 million phones in 2014, down from 423 million the previous year, according to China’s Ministry of Industry and Information Technology.

Alibaba is well set to take advantage of this growth, having broken all previous financial records with an IPO of over $22bn last September. It has made several investments in the mobile space already, including leading a $280m round for messaging app Tango, a $120m deal for U.S.-based mobile games startup Kabam, and a recent $10m investment in Android games console maker Ouya.

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