Advertisement
China technology
TechBig Tech

Demand for cloud services in China increases to quarterly record high of US$4.3 billion

  • The market is being driven by government stimulus measures, investment by service providers, digital transformation projects and increased demand for online services
  • Second-quarter cloud spending in China accounted for 12.4 per cent of the US$34.6 billion total global investment during that period

Reading Time:2 minutes
Why you can trust SCMP
0
Alibaba Cloud, China’s biggest cloud infrastructure services provider, is investing US$29.2 billion on new next-generation data centres. The company is the digital technology and intelligence backbone unit of e-commerce giant Alibaba Group Holding. Photo: Handout
Iris Deng
China maintained its position as the world’s second-largest cloud services market amid record spending of US$4.3 billion in the second quarter, fuelled by increased demand for online services during the Covid-19 pandemic and government stimulus measures, according to a report.
That marked a 70 per cent increase from a year ago, led by domestic cloud infrastructure services spending on Alibaba Cloud, according to research firm Canalys in a report on Wednesday.
Alibaba Cloud, the digital technology and intelligence backbone unit of e-commerce giant Alibaba Group Holding, had a 40.1 per cent market share in the second quarter. Alibaba is the parent company of the South China Morning Post.

“Momentum in China’s cloud infrastructure services market is set to accelerate,” Canalys analyst Blake Murray said in the report. “An already growing market is being propelled by government initiatives, commitment by cloud service providers to invest, as well as increasing demand for digital transformation and online services in the post-Covid-19 economy.”

Second-quarter spending on cloud services in China accounted for 12.4 per cent of the US$34.6 billion total global investment during that period, data from Canalys showed. The US, home to industry leaders Amazon Web Services (AWS), Microsoft Azure and Google Cloud, was still the world’s top market for cloud infrastructure services.

Cloud computing services enable companies to buy, sell, lease or distribute a range of software and other digital resources as an on-demand service over the internet, just like electricity from a power grid. These resources are managed inside data centres.

Advertisement