Alibaba Cloud's 4 new data sites

BEIJING • Alibaba Cloud plans to open four new data facilities outside China, the cloud unit of Alibaba Holdings said yesterday, as it seeks to grab global market share from leading players Amazon.com and Microsoft.

The facilities in Dubai, Germany, Japan and Australia will extend the reach of China's leading cloud computing service provider to every major continent, and marks the latest step in its US$1 billion (S$1.4 billion) infrastructure investment drive.

Also known as Aliyun, the unit has flourished domestically, thanks to Beijing's strategic emphasis on building home-grown cloud technology, while foreign firms have grappled with stringent licensing restrictions in the country.

But it accounts for a much smaller slice of the global market for cloud computing, defined as the storage of data on remote networks rather than local servers, which is expected to reach US$135 billion by 2020, says research firm Canalys.

Alibaba Cloud is forecast to take 7.8 per cent of that market, while leading players Amazon.com, Microsoft, IBM and Alphabet are expected to account for 69.1 per cent.

Mr Yu Sicheng, head of Alibaba Cloud, said the unit's strength in China was a significant advantage and a linchpin in the company's globalisation plans. "We have the US, Europe plus China, which is quite difficult," he told Reuters in an interview.

The new additions will bring Alibaba Cloud's total number of foreign cloud facilities to eight, surpassing the six within China, though the majority of the firm's data volume remains within China.

It will launch the data facilities through partnerships with Vodafone in Europe, Softbank Group Corp in Japan and YVOLV in Dubai, a joint venture between Alibaba Cloud and Meraas Holdings.

Mr Yu, however, declined to comment on when the unit will likely post a profit, even as it has seen six quarters of consecutive triple-digit growth, to become Alibaba's fastest growing sector.

REUTERS

A version of this article appeared in the print edition of The Straits Times on November 22, 2016, with the headline 'Alibaba Cloud's 4 new data sites'. Print Edition | Subscribe