HTC and Alibaba Group have signed a cooperation agreement under which HTC's newly established virtual reality unit will use Alibaba's cloud computing services.

According to reports in Chinese local media, HTC has been vigorously promoting its head-mounted VR device HTC Vive, aiming to gain new success after the decline of its smartphone business. To stimulate consumers' interest in VR and increase product sales, the Taiwanese company has launched many major measures. In April 2016, HTC set up USD100 million investment fund targeting VR start-ups. In July 2016, the company announced plans to open over 10,000 HTC Vive experience sites in mainland China to provide convenient VR experience to consumers across the country.

HTC said that with the cooperation of Alibaba, the two parties will jointly improve data center infrastructure which is needed to offer streaming and reliable VR contents to consumers.

Ge Jin, Aliyun's business architecture director, said that cloud computing continues to break the limit of imagination and accelerate innovation. The cooperation ties two technology leaders together and will bring more value to VR and cloud computing. Ge also said that the cooperation between the two parties will accelerate the development of VR technologies in Chinese mainland and promote VR penetration across the world. As a part of the transaction, HTC recently launched a VR app store for Aliyun, Alibaba's cloud computing service.

Financial terms of the HTC and Alibaba alliance were not disclosed.