China’s leading smartphone maker, Xiaomi said that it would acquire a stake in the country’s largest video streaming company, Youku Tudou. However, no detail has been provided about how large the smartphone maker’s stake would be.
Xiaomi said last week, that it would invest $1 billion to expand its internet TV content as it seeks to draw attention of country’s more than 600 million Internet users. Earlier this year, Alibaba Group Holding Ltd. also took a 16.5% stake in Youku Tudou. Youku Tudou and Xiaomi will also jointly invest in the production and distribution of online video content and films, while Xiaomi will license Youku Tudou’s video content. Xiaomi will invest in Youku by acquiring its stock on the open market, Youku said.
Youku Tudou stated-
Youku Tudou’s ability in producing original content will provide strong support to the Xiaomi family of hardware by making the user experience more compelling, and will help to boost average revenue per user.
Xiaomi entered the smart TV market last year and this move clearly depicts its intentions to put down its roots in the department more firmly. However, regulators recently cracked down on widespread unlicensed Internet TV content, thinning offerings for smart TVs and set-top boxes.
Forrester Research technology analyst Xiaofeng Wang says that though Xiaomi is doing well in the Smart TV business due to their competitive pricing, they still do not have content for their TVs.
The Tech-Portal had earlier reported that Xiaomi is in plans to raise fresh funding worth $1.5 Billion. Apart from using these new funds in expansion plans, Xiaomi is also looking to further expand into Smart TV business.