Apsara Conference 2019: Alibaba Cloud Deepens Engagement with Big Data and AI and Extends International Footprint

C. Drake

Summary Bullets:

  • In addition to consolidating domestic market primacy, Alibaba Cloud is intent on establishing leadership in other Asia-Pacific cloud and IT markets, including Indonesia.
  • Accompanying Alibaba Cloud’s geographical expansion is a commitment to delivering higher-value solutions that leverage AI and big data, to help customers with their digital transformation objectives.

Alibaba’s cloud and IT business, Alibaba Cloud, kicked off its annual conference in Hangzhou, China with a commitment to working with customers to drive innovation, while also extending the success of its China strategy to other geographical markets. This year’s Apsara Conference, which brought together around 6,000 clients, partners, and developers, was a milestone event for Alibaba Cloud, which celebrates its tenth anniversary this month and whose rapid expansion has propelled it into the ranks of the world’s top five cloud service providers.

Alibaba’s Apsara-branded cloud stack was originally built to support the needs of the company’s massive e-commerce business; it was subsequently developed into a commercial offering for Alibaba’s business, government, and other institutional customers, providing them with access to flexible, scalable cloud compute and storage resources. Alibaba is sometimes compared with Amazon, another major online retailer whose cloud business, Amazon Web Services (AWS), is the largest provider of public infrastructure-as-a-service (IaaS) resources globally. However, whereas AWS accounts for around 18% of Amazon’s total revenue, Alibaba Cloud currently represents a much smaller 7% of Alibaba’s total business.

Nevertheless, for its 2019 fiscal year (ending March 31), Alibaba Cloud generated $3.68 billion in revenue, which represented an 84% increase compared with the previous year. With a deepening engagement with industry partners like SAP, Salesforce, and VMware; a commitment to innovation with emerging technologies like AI, IoT, and blockchain; and a growing focus on international expansion, Alibaba’s cloud business looks set to continue challenging public cloud competitors AWS, Microsoft Azure, and Google Cloud.

In addition to cementing and expanding its strong position in its domestic cloud and IT market, Alibaba is intent on establishing its leadership in other markets in the Asia-Pacific region, including Indonesia, the world’s third most populous country. At the start of September, Alibaba announced the launch of a second data center in Indonesia, doubling the capacity of its cloud business in that country. This was in response to strong customer demand and followed just ten months after the launch of Alibaba’s first data center in Indonesia.

Alibaba’s global cloud footprint now consists of 61 Availability Zones in 21 global regions that include Australia, India, Japan, Malaysia, Germany, the United Kingdom, and the United States. The company plans to launch in other regions in the coming months.

Accompanying this geographical expansion is a focus on delivering higher-value solutions that can help customers with their digital transformation objectives. Notably, Alibaba is developing existing and new offerings that support AI product development, hybrid cloud enablement, IoT, and the application of data intelligence to scenarios ranging from smart cities to urban planning. Together, these investments will help Alibaba continue on its current disruptive path, capturing a growing share of the international market for public, private, and hybrid cloud services and consolidating a dominant position in markets where AWS and Microsoft currently lack presence.

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