SPURRED BY INCREASED DEMANDS AMIDST COVID-19

Alibaba announced today (Monday) that it plans to invest 200 billion yuan ($28.26 billion) in its cloud computing arm over the next three years.

According to the tech giant, this cloud expansion plan was partly spurred by the coronavirus pandemic which results in an increased demand for digital services. The company is setting this fund to invest in cloud infrastructures and technologies within the sphere of data centers, operating systems, servers, chips and networks.

“The Covid-19 pandemic has posed additional stress on the overall economy across sectors, but it also steers us to put more focus on the digital economy,” said Jeff Zhang, president of Alibaba Cloud Intelligence.

“By increasing our investment on cloud infrastructure and fundamental technologies, we hope to continue providing world-class, trusted computing resources to help businesses speed up the recovery process, and offer cloud-based intelligent solutions to support their digital transformation in the post-pandemic world.”

Alibaba cloud arm currently have 63 availability zones which spread across 21 data center regions located in Asia, Australia, the Middle East, Europe and the United States. The company has the largest cloud market share in Asia and competes with giants such as Amazon and Microsoft on the global market.

“Over the past decade, [Alibaba Cloud] has developed its proprietary technologies across the board including the Apsara Distributed Operating System, AI-inference chip Hanguang 800, X-dragon Architecture, RDMA (Remote Direct Memory Access) high-speed network, Super Computing Cluster and leading network devices such as VSwitch,” Zhang added.

The amount budgeted for this expansion project represents about 50% of the revenues Alibaba Group reported in 2019 which totaled 376.8 billion yuan (US$56.152 billion). This is currently the biggest expansion project ever planned in the global cloud industry.

In February, Alibaba cloud supported its customers whose business have been impacted by the Coronavirus pandemic with the offering of up to $1,000 of free credits to purchase its cloud service.