Alibaba cloud services business poised for record growth as global market expands
Alibaba Cloud, a subsidiary of e-commerce titan Alibaba Group, has become the largest cloud infrastructure services provider in Asia-Pacific on the back of its massive market in China and strategic international expansion, analysts said.
The Hangzhou-based business is forecast to record more than US$1 billion in revenue next year, while strengthening its position as the world’s No 4 “massive-scale” cloud infrastructure services provider behind industry leader Amazon Web Services, Microsoft Azure and Google Compute Engine.
“We are projecting substantial growth for Alibaba Cloud that would already be right at historical record highs for the cloud industry,” Philbert Shih, the managing director at Canadian firm Structure Research, told the South China Morning Post.
Alibaba is making huge investments [in its cloud business] and could beat our projections
Founded in 2009, Alibaba Cloud operates the network that powers parent Alibaba’s online and mobile e-commerce businesses, and supports the merchants on those platforms.
It has since become mainland China’s largest cloud infrastructure services provider, with more than 2.3 million domestic clients as of March 31.
Cloud computing enables companies to buy, sell, lease or distribute online a range of software and other digital resources as an on-demand service, just like electricity from a power grid.
These resources are kept and managed inside data centres. “Cloud” refers to the internet as depicted in computer network diagrams.
According to Structure Research, Alibaba Cloud is predicted to generate US$1.45 billion in sales by 2017, up from an estimated US$761 million this year.
