March 24, 2023

Alibaba is best known for its sprawling e-commerce empire, but like Amazon, cloud services have been a big driver of its revenue in recent years.

The Chinese cloud giant is poised to double down on its overseas presence Announce Invest $1 billion today in “Global Partner Ecosystem Upgrade.”Alibaba Cloud is now The third largest public cloud provider in the worldthis achievement is inseparable from its vast network of local allies formed around the world.

The company keeps Recruit local partners Responsible for sales, technical support and customer service. The company said the $1 billion program is designed to “support partners in technological innovation and market expansion through Alibaba Cloud over the next three fiscal years.” Funding will come from financial and non-financial incentives, including funding, rebates and listing programs.

Alibaba Cloud currently has about 11,000 partners worldwide, including Salesforce, VMware, Fortinet, IBM and Neo4j.

According to the market research firm, Alibaba Cloud will have a market share of 9.5% in 2021, behind Microsoft (21%) and Amazon (39%) Gartner.

Based in Hangzhou, the cloud service has a global footprint and has become the preferred cloud solution for many Chinese enterprises to go overseas. But rising national security tensions between China and the West have forced some customers away from its cloud platforms. TikTok reportedly wants to win over U.S. regulators leave Alibaba Cloud and move all its US data to Oracle servers.

Even early Chinese companies have joined the technology diversion. In the past few months, several consumer-facing internet startups, including social networking and productivity tools, have told me that they store all of their offshore user data on foreign cloud services just to avoid future regulatory scrutiny.

Alibaba Cloud has recently suffered from slowing growth and the loss of a key cloud client that industry watchers speculate is ByteDance.As the company in its June earnings report:

The year-over-year revenue growth in our cloud business reflected a return to growth in the overall non-internet sector driven by the financial services, public services and telecommunications industries, partially offset by lower revenue from our top internet customers who phased out due to non-product-related demand , online education customers, and other customers in China’s internet industry, which provided overseas cloud services for its international business, were weak in demand.

Western tech companies are facing the same decoupling pressure in China. The country’s data laws prevent user data from leaving the country, so companies such as Apple and Tesla have long stored Chinese user data in domestic cloud centers.

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