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Alibaba Cloud expands footprint in APAC

Chinese cloud service provider Alibaba is opening datacentres in India and Indonesia as part of ongoing efforts to ramp up its presence in the region

The cloud computing arm of Chinese e-commerce giant Alibaba is opening datacentres in India and Indonesia in a bid to carve a slice of the Asia-Pacific (APAC) cloud market.

The two facilities will expand Alibaba Cloud’s current crop of datacentres in Australia, Germany, Japan, Hong Kong, Singapore, the United Arab Emirates (UAE) and the US. The company expects to open two more datacentres by the end of March 2018.

Alibaba Cloud said its datacentres in APAC, including one in Malaysia slated to open by the end of 2017, will increase its computing resources in the region, enabling small and medium-sized enterprises (SMEs) to take advantage of cloud capabilities.

Speaking at the recent launch of the 99% SME campaign led by Singtel and DBS in Singapore, Daniel Zhang, CEO of Alibaba Group, said SMEs have always been a key focus for the company.

“Our mission from day one is to make it easier for SMEs to do business everywhere,” he said, adding that Alibaba Cloud had also been working with Singtel to help Singapore SMEs move to the cloud since 2015.

Simon Hu, senior vice-president of Alibaba Group, said it was uniquely positioned with “cultural and contextual advantages” to provide data intelligence and computing capabilities to APAC customers.

“Among global cloud top players, we are the only company originating from the east,” a company spokesperson told Computer Weekly. “By working extensively with China or Asia-based clients, we have a better understanding of their needs and more insightful knowledge of the China and Asia market.”

During the 2017 fiscal year, the number of Alibaba Cloud’s paying customers grew to 874,000, an increase of 70% from the previous year. Apart from startups and SMEs, the company also counts large customers in the energy, financial, healthcare, manufacturing, media and retail industries as clients.

Hong Kong-based travel retailer DFS, for instance, has migrated critical applications such as SAP to Alibaba Cloud’s Hong Kong datacentre using a hybrid cloud model, according to analyst firm Ovum.

Industry experts have pointed out that while Alibaba Cloud, which commands about 40% of China’s cloud market, may lack the experience of its global rival Amazon Web Services (AWS), it could learn from AWS’s success in international markets.

For one, Clement Teo, principal analyst at Ovum, noted that Alibaba Cloud does not use an open cloud platform, and neither can it orchestrate workloads across the likes of AWS, Microsoft Azure and Google Cloud Platform.

“This could be a weakness if it wants to tap into an international enterprise space that’s already using these other clouds, be they in the public or hybrid mode. It is a multi-cloud world and Alibaba needs to cater for this,” he said in a recent research note.

Alibaba Cloud, however, disagreed, noting that it offers an open cloud, and is committed to providing customers and partners with an ecosystem to leverage technology and business resources the most.

“Further to adopting cloud, we are seeing more companies consider a multi-cloud strategy, to improve overall enterprise performance by avoiding supplier lock-in and using different infrastructures to meet the needs of diverse partners and customers,” it told Computer Weekly.

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The company said its recent partnerships with Megaport and Equinix, which deliver more connectivity options, would also make it easier for companies to embark on hybrid cloud deployments.

“At the same time, a number of open source DevOps tools such as Ansible, Terraform and Cloud Foundry can be easily integrated with Alibaba cloud platform,” it said.

Ovum’s Teo said Alibaba Cloud also needed to bring more global systems integrators into its fold, beyond its current pool of largely Chinese partners such as Yong You, Digital China and GDS.

“While it has formed collaborations with Accenture, AMD, Docker, Intel, Nvidia, PCCW, SAP and SK Holding C&C to accelerate regional and global business opportunities, its main customer and partner base is still heavily weighted in China,” he added.

According to Ovum’s ICT Enterprise Insights cloud survey for 2016/17, the public cloud market in Asia is expanding faster than in other regions, with 70% of respondents stating that they would be using public cloud by 2018. 

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