Apr 21, 2020 16:00:00

Alibaba announces that it will invest about 3 trillion yen in the cloud computing business over the next three years

by

Marco Verch

Alibaba , the largest Chinese e-commerce company, announced on April 20, 2020 that it will invest 200 billion yuan (about 3 trillion yen) in the cloud computing sector in the next three years. Alibaba has already held the top share in the cloud computing market in China, but it is expected that it will aim to expand its share in the global market where Amazon and Microsoft are among the top names.

Alibaba to invest $ 28 billion in cloud as it battles Amazon, Microsoft
https://www.cnbc.com/2020/04/20/alibaba-to-invest-28-billion-in-cloud-as-it-battles-amazon-microsoft.html

Alibaba to invest $ 28b in cloud to challenge Microsoft, Amazon | Fortune
https://fortune.com/2020/04/20/alibaba-invest-28-billion-cloud-challenge-microsoft-amazon/

Alibaba to pump $ 28B into cloud computing to handle coronavirus traffic
https://thenextweb.com/hardfork/2020/04/20/alibaba-to-pump-28-billion-into-cloud-computing-to-handle-coronavirus-traffic/

Alibaba has established Alibaba Cloud , Alibaba's cloud computing division, to handle the huge amount of online shopping transactions. We have been aggressively investing so far, but the additional investment of 200 billion yuan announced this time is large enough to account for about half of the sales in 2019. According to Alibaba, this additional investment will be made for OS, servers, chips, etc., improvement of networks built in 21 regions around the world, and construction of new data centers.

This additional investment will be impacted by the new coronavirus infection (COVID-19). Alibaba pointed out that as of mid-February 2020, COVID-19 could be devastating to the global economy. According to the British financial magazine Financial Times, sales of major brands such as Estee Lauder and UNIQLO sold on Alibaba's e-commerce site from January to February 2020 compared to January to February 2019 It has been reduced by 40-80%.

by Simple FX

Meanwhile, Alibaba Cloud is experiencing rapid growth, with Alibaba Cloud revenue surpassing 10.7 billion yuan (about 160 billion yen) in the fourth quarter of 2019, recording a 62% increase from the same period last year. It is being done.
`` COVID-19's pandemic is putting more stress on the overall market economy while urging it to focus more on the digital economy, '' said Jeff Chang, Alibaba's cloud intelligence president, Alibaba's earnings recovery. Said he hopes to speed up.

In addition, at the time of writing the article, only 7% of Alibaba's total revenue is from the cloud computing department. 'We think cloud computing will be Alibaba's key business in the future,' said Alibaba Group Chairman Daniel Chan in a 2018 interview . CNBC, an overseas economic news media company, evaluated that Alibaba is trying to follow its peers, which have a large share in the global cloud computing market, such as Microsoft that provides Azure and Amazon that provides Amazon Web Services .