HANGZHOU, China -- The Alibaba Group and the government-affiliated Chinese Academy of Sciences said Wednesday they will work together on research and development of practical applications of quantum cryptography for secure data transmission.

The academy and Alibaba's cloud computing subsidiary, Aliyun, co-founded a quantum computing laboratory in Shanghai in July. With Wednesday's announcement, the partners have embarked on R&D and plan to start large-scale verification experiments by the end of the year.

The announcement did not include any definite timeline, but the technologies the two develop will be leveraged to improve the reliability of the Alibaba Group's cloud services.

Countries around the world are rushing to develop quantum cryptography, an ultimate form of encryption. This collaboration in China will only intensify the race with nations such as Japan and the U.S.

Also Wednesday, Alibaba announced the start of a business to support entrepreneurs using the cloud in a tie-up with Foxconn, the Chinese subsidiary of Taiwan's Hon Hai Precision Industry. Alibaba will offer its technologies for big data analysis, and Foxconn will contribute its knowledge of product design, patenting, and parts supply networks.