Asia’s post-virus economic revival to be built on the back of Chinese cloud services

Cloud services are set to boom as e-commerce props up SMEs amid post-COVID-19 economic recovery.

May 5th, 2020 – The COVID-19 pandemic has caused many traditional businesses to completely rethink their strategies for the future. As disruptions to production and consumption have left many firms strapped for cash, companies are now more than ever trying to optimize their efficiency and reduce costs, and many are opting for cloud-based services as the main alternative to do so.

China’s preeminent names in cloud computing, Alibaba (NYSE: BABA) and Tencent (HKG: 0700), are now at the forefront of this shift in strategy across sectors including e-commerce and gaming.

Alibaba, already China’s leader in cloud services, is doubling down on this transformation, announcing a USD 28 billion investment over three years in its cloud infrastructure last week.

Already occupying a strong 46.6% of the Chinese cloud market, Alibaba has also successfully expanded its cloud services to the Asia Pacific (APAC) region, outperforming the likes of international providers including Microsoft and Amazon in the region with a 19.6% share of the market. Alibaba Cloud generated over RMB 10 billion in revenue during the fourth quarter of 2019, marking an impressive annual growth of 62.7%.

Overall, the Chinese market for cloud services shows enormous potential. According to research firm Canalys, China’s cloud market grew 66.9% year-on-year in the fourth quarter of 2019. Domestically, Alibaba’s closest competitors are Tencent Cloud and Baidu Cloud, with 18.0% and 8.8% of the Chinese market respectively.

Written by KrAsia
https://kr-asia.com/asias-post-virus-economic-revival-to-be-built-on-the-back-of-chinese-cloud-services