Alibaba Cloud opens a new Hangzhou campus the size of Google’s Silicon Valley headquarters

Alibaba Cloud’s new 10-building campus covers 2.1 million sq ft in Hangzhou, with 450,000 sq ft of office space
The campus highlights the increasing importance of cloud computing for the tech giant as its e-commerce business slows along with the broader economy

Alibaba

Tracy Quin Shanghai

Published: 10:00pm, 10 Oct, 2022

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Alibaba Cloud, the cloud computing unit of Alibaba Group Holding, has opened a new campus covering an area of 198,200 square metres (2.1 million sq ft) in its home city of Hangzhou, in the latest sign of the Chinese tech giant’s commitment to its booming cloud business.

The new 10-building campus, with a total floor area of 450,000 square metres, is located in the western part of the city, where its futurist landscape spans an area as large as Hong Kong’s Victoria Park. It is also roughly the size of the campus for Google’s Silicon Valley headquarters, referred to as the Googleplex, which covers about 2 million sq ft in Mountain View, California.

In a video, Alibaba Cloud highlighted eco-friendly designs used across the campus, including a photovoltaic power generation system, flowerpots made from recycled plastic and high-efficiency, low-energy devices in the on-site coffee shop.

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The campus is another reminder of the important role that Alibaba plays in Hangzhou, the provincial capital of eastern Zhejiang province. Entrepreneur Jack Ma started the e-commerce giant there in 1999 in a residential flat, and its local presence has since grown to multiple campuses in different parts of the city.

Alibaba owns the South China Morning Post.

The new facilities for its cloud business come as Alibaba pins its hope for future growth on cloud computing. E-commerce services, which have been the company’s bread and butter, have been facing slowing growth as China’s economy also slows and amid fierce competition from rivals and newer market entrants.

Alibaba’s net income fell 50 per cent year-on-year in the second quarter to 22.74 billion yuan (US$3.4 billion), while sales of 205.56 billion yuan were roughly unchanged from the same period the previous year.

This has helped put a spotlight on Alibaba Cloud, which remains a stand-out performer at the company. It had the fastest growth among all of Alibaba’s business segments in the second quarter, making up 9 per cent of total revenue.

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Still, growth for the cloud business was slower than the preceding two quarters. Growth fell from 20 per cent in the fourth quarter to 12 per cent in the first.

Alibaba CEO Daniel Zhang Yong attributed this to multiple factors, “including slowing macroeconomic activities, a decline in revenue from the top internet customers, softening demand from China’s internet customers, and a delay in parts of our hybrid cloud projects due to the impact of Covid”.

With a slowing domestic economy, Alibaba Cloud has also been seeking new growth opportunities overseas. Last month, the unit said it had committed US$1 billion in upgrading its global partner ecosystem.