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The
data 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
the unit's $1 billion infrastructure investment drive.
Also known as Aliyun, the unit has flourished domestically
thanks to Beijing's strategic emphasis on building homegrown
cloud technology, while foreign firms have grappled with
stringent licensing restrictions in the country.
However, 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 $135 billion by 2020, according to research firm Canalys.
Alibaba Cloud is forecast to take 7.8 percent of that market,
while leading players Amazon.com Inc, Microsoft, International
Business Machines Corp and Alphabet Inc are expected to account
for 69.1 percent.
Yu Sicheng, general manager of Alibaba Cloud's international
business, said the unit's strength in China was a significant
advantage and a lynchpin in the company's globalization plans.
"We have the U.S., Europe plus China, which is quite difficult,"
he told Reuters in an interview.
The new additions bring Alibaba Cloud's total number of foreign
cloud facilities to eight, surpassing the six within China,
though the majority of the company's data volume remains
squarely 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
LLC.
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
business sector.
"Our focus is to keep expanding our market leadership and
presence and this is our priority for now," he said.
(Corrects title of Alibaba Cloud executive Yu Sicheng)
(Reporting by Catherine Cadell; Editing by Stephen Coates)
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