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Can an NFL Deal Take Alibaba’s Youku to the Top?

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Dec. 20 2018, Updated 4:00 p.m. ET

Youku signs up for NFL content programming in China

Alibaba (BABA) has partnered with the NFL on digital sports content programming in China. Under the deal, Alibaba’s Youku service will carry weekly programming of NFL content, such as game highlights and behind-the-scenes stories. Documentary content will also be included.

The NFL deal sees Alibaba stepping up the competition with its rivals Tencent (TCEHY) and iQiyi (IQ) in terms of popular sports programming in China. Tencent currently has the exclusive rights to show live NFL games on the Internet in China. On its part, iQiyi is the PGA Tour’s official digital streaming partner in the country.

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Youku trails the competition

China’s video streaming market is booming, with data from eMarketer showing that close to 229 million people will use an online video subscription service in the country in 2018. The number is expected to exceed 700 million people by 2020. China’s population is 1.4 billion, and eMarketer expects half of the country to be using subscription video services by that time.

But Alibaba’s Youku is currently trailing Tencent and iQiyi in terms of reach. According to eMarketer, Tencent Video will capture 24% of digital video viewers in China in 2018 compared to 23% for iQiyi and 22% for Youku. This raises the need for Youku to find new ways to drive the uptake of its service.

Using sports to grow a video audience

Sports programming is becoming a popular way for digital video providers to drive audience growth. Amazon (AMZN) and Twitter (TWTR) have the rights to show certain NFL content, while Facebook (FB) has acquired the exclusive rights to broadcast Spain’s La Liga soccer matches in India and other places for three years, according to Reuters.

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