• Alibaba Cloud’s partnership with Sena on Smart City initiative strengthens the provider partner ecosystem, especially with the domestic players.
• However, Alibaba Cloud’s City Brain still has limited customer references compared to other hyperscalers such as AWS and Azure. The cloud stack such as AWS Outpost and Azure Stack would enable cloud providers to address the data residency and edge compute requirements without having local facilities.
On May 23, 2019, Alibaba Cloud announced a collaboration with Sena Traffic System (Sena), Malaysia’s leading smart traffic controller, to build a smart traffic management in the country. In the partnership, Alibaba Cloud will provide its City Brain solution, cloud computing resources, and talent development programs while Sena will be responsible for the overall design and development of the traffic light systems as well as the deployment.
Alibaba Cloud City Brain
City Brain leverages data analytics and artificial intelligence to continuously self-learn and adapt to the changing environment such as events, traffic. and public transportation. It is successfully implemented in Hangzhou (Alibaba’s hometown / headquarters) increasing the average travel speed by 15% and reducing the travel time by three minutes. In another city in China, Suzhou, the passenger volume on pilot public bus routes has increased by 17%.
Alibaba Cloud’s partnership with Sena shows that its investment to build domestic data centers is beginning to pay off. A smart city deployment often requires the data to be hosted within close proximity locally due to the high privacy and security requirements of the local authorities information. Edge compute is also a crucial part of the deployment to ensure low latency communications between the platform and devices such as traffic lights. Alibaba Cloud is leveraging its local facility to gain the advantage over other hyperscale providers to capture the growing demand. While some countries such as South Korea, Singapore, and India have started their smart city initiatives many years ago, many other countries, especially in the emerging markets like Malaysia and Indonesia are still in the very early stage of deployment (e.g., trial or pilot).
With successful references such as City Brain in Kuala Lumpur and local facilities, Alibaba Cloud could use the same advantage in the other Southeast Asia markets such as Indonesia. In Indonesia, other hyperscale players (e.g., AWS, Google) are still building their data centers and strengthening the local presence. With existing facilities there, Alibaba Cloud could use its first-mover advantage to address the data residency and edge compute requirements in smart city use cases and hence grab the growing opportunity in the country. With a population of 264 million, Indonesia has several metropolises with populations exceeding 5 million, that suffer serious traffic congestion issues. Alibaba Cloud could highlight its smart city reference in Hongzhou which has a population of around 7 million to address the similar size cities in Indonesia such as Surabaya, Bandung, and Semarang.
However, the smart city market landscape is getting more competitive. Between hyperscale providers, Alibaba Cloud’s customer references are still way behind competitors like AWS and Microsoft Azure. There are also other providers such as system integrators and carriers who are building up their smart city portfolio and have stronger propositions in professional services and connectivity respectively. Apart from tougher competition, there is a growing trend on hybrid cloud, where hyperscale providers are offering cloud stack for private environments such as Azure Stack, AWS Outpost including Alibaba Cloud’s own Aspara Stack. This would enable the solution to be deployed on-premises or in private cloud environment without the need for public cloud hosted within the country.