Alibaba is investing $ 28 billion in cloud services Alibaba Group Holding Ltd said it will invest 200 billion yuan ($ 28 billion) in its cloud infrastructure over three years – a plan that follows a boom in business software […]
Alibaba is investing $ 28 billion in cloud services
Alibaba Group Holding Ltd said it will invest 200 billion yuan ($ 28 billion) in its cloud infrastructure over three years – a plan that follows a boom in business software demand as the outbreak of the coronavirus outbreak in China peaked.
The company said it will spend funds on developing semiconductors and operating systems, as well as building infrastructure for its data center..
While most Chinese employees worked from home during February, the country’s dominant cloud service faced increased use of its software, especially DingTalk, a workplace chat application used by both businesses and schools..
At some point, users complained about lags in the application due to the large volume of activity. The company acknowledged the problems by posting a comment on Weibo, a Chinese social network..
President of Alibaba Cloud Intelligence Jeff Zhang stated that the COVID-19 pandemic «created additional stress for the economy as a whole by sectors», and the company hopes that the investment will help businesses «speed up the recovery process».
Alibaba’s cloud division is one of the fastest growing businesses. Revenue in the fourth quarter increased by 62% to 10.7 billion yuan, for the first time in one quarter it exceeded 10 billion yuan.
The tech giant took 46.4% of China’s cloud market in the fourth quarter, according to research firm Canalys. Tencent Cloud and Baidu Cloud, which also faced increased demand for their products, occupied 18% and 8.8% of the market, respectively.
During the first quarter, Alibaba’s cloud arm also helped the Hangzhou government build and deploy a digital health monitoring system that assesses the impact of the virus using red, yellow and green codes. The system was later deployed throughout the country..