Aliyun, Alibaba Group Holding Ltd (NYSE:BABA)’s cloud computing business has announced it will launch a cloud computing hub in silicon Valley. The new data center marks the company’s latest measured expansion to American soil and will be facing a very solid competition according to Fortune.
Aliyun has data centers in Hangzhou, Qingdao, Beijing, Hong Kong and Shenzhen. The Silicon Valley data center will provide a variety of cloud computing services that the company expects will attract overseas Chinese businessman as they develop different kinds of applications.
“Aliyun offers users top-notch cloud computing products and services at competitive prices. Now Aliyun hopes to meet the needs of Chinese enterprises in the United States, and the ultimate objective of Aliyun is to bring cost-efficient and cutting-edge cloud computing services to benefit more clients outside China to boost their business development,” said Ethan Sicheng Yu, Vice President of Aliyun.
Aliyun, Alibaba Group Holding Ltd (NYSE:BABA) dominates e-commerce in China, but Aliyun, also known as Alibaba Cloud Computing, has about 23% of the market share in its home market. Some of its competitors are China Telecom, Amazon.com, Inc (NASDAQ:AMZN) and Microsoft Corporation (NASDAQ:MSFT).
“This is a very strategic move for us,” Yu said, declining to say how much Alibaba invested in the data center or disclose its location for security reasons. “International expansion is actually a company strategy in the coming few years.”
Aliyun, which has been linked to a promising version of Amazon Web Services, began its journey as a part of the Alibaba Group Holding Ltd (NYSE:BABA)’s technical infrastructure but now it has expanded to rent processing and storage space for small and medium businesses in China.
“Gradually we will start to attract international customers,” Yu said. “There are actually lots of U.S. customers, U.S. enterprises who look forward to setting up lots of data centers in China to serve their Chinese-based customers. I do see there is big demand for U.S. customers who look for balanced presence of their IT infrastructure across the world, including China.”
In recent months, Alibaba had made headway in emerging markets from Russia to Brazil but the company has taken a calculated approach to the U.S market. The Californian data node will initially serve for Alibaba’s internal business like AliExpress as well as external cloud clients. The company’s Vice President chose not to disclose any details about any potential clients. But startups generally rely profoundly in cloud service providers to power their services. And it’s a known fact that Alibaba has invested in different U.S. firms such as Tango and some online retailers like Shoprunner.
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