Another blow to Alibaba’s table, this time claiming its position as one of the main cloud providers in the market. At the beginning of 2020, the Asian giant already announced that it intended to turn its cloud infrastructure into a direct competitor of Microsoft, Azure cloud services, and Amazon, which has Amazon Web Services. for which he announced an investment of 26 million dollars over a period of three years. Now it has just announced yet another boost, with a billion dollars to strengthen its market share outside of China.
Although the bulk of the company is still an incredible e-commerce empire where it hardly has a rival -especially in its country of origin-, its cloud service has not stopped growing in recent years. Helped, as in the case of Amazon, by an increase in the digitization of companies and the challenge caused by the pandemic a little over two years ago.
According to Alibaba, this extra investment represents an “upgrade of the global ecosystem of partners”. In other words, it will be a billion dollars for Alibaba Cloud, already the third largest public cloud provider in the world, to help its local partners spread all over the world to boost their position as a cloud service provider and continue to gain ground in the market.
Alibaba Cloud seeks local partners around the world
Currently, the company is in a phase of recruiting and attracting local partners who can support tasks such as technical support, sales and customer services of Alibaba Cloud. An initiative with which the company has stated intends to “support partners’ technological innovation and their market expansion with Alibaba Cloud in the next three years.” Those billion will materialize in financial and non-financial incentivesincluding financing, rebates, and product launch initiatives
Alibaba Cloud is a cloud service based in the Hangzhou region of China. An option that has already become the reference cloud solution for many companies from their country of origin that decide to expand abroad. However, this is where the company is encountering more stumbling blocks than it would like. And it is that the current tensions in terms of national security between China and the West -with the US at the head-, have made it possible to expand abroad, Many Chinese companies have stopped using Alibaba Cloud.
The objective of these is none other than to gain the trust of the increasingly strict US regulators. An example is found in the popular TikTok social network that would have left the Alibaba Cloud and moved its US data to Oracle servers.
Alibaba Cloud has also suffered another major setback by losing one of its main cloud clients, ByteDance. Add to this how many Chinese startups are starting from scratch to already store all user data overseas just to avoid regulatory scrutiny, it has caused the Alibaba Cloud’s growth has suffered. These alliances with local partners are expected to be vital for the expansion of this division of the Asian giant.
However, it is not all bad news for Alibaba Cloud. According to its June report, its cloud revenues had risen in three key sectors: financial services, public services and telecommunications sector.
Notably Western tech companies are also under the same pressure in China. The country’s data law prohibits user data from leaving its borders, so companies like Apple and Tesla have long been storing Chinese user data in domestic cloud centers.
