China's Alibaba to launch Asia-Pacific cloud services operation in Singapore, heating up rivalry with Amazon

PUBLISHED : Wednesday, 19 August, 2015, 5:22pm
UPDATED : Thursday, 21 June, 2018, 3:17pm

Alibaba Group, the world's biggest e-commerce services provider, is opening a new data centre in Singapore next month as it sees the island state as a hub for expanding its cloud-computing business across the Asia-Pacific market.

That launch would signal a strong challenge to Amazon, which was first to establish a regional cloud operation in Singapore for subsidiary Amazon Web Services in 2010.

The new Singapore data centre for Aliyun, the company's cloud-computing arm, follows its recent initiatives in California's Silicon Valley and Dubai, the most populous city in the United Arab Emirates. The news was announced Wednesday.

Ethan Yu Sicheng, a vice-president at Aliyun, said there was healthy demand for cloud-related data management services in Singapore "because of the ease of doing business there, the comprehensive transport and telecommunications connections, and robust intellectual property regime".

"The city-state is a natural springboard into the Asia-Pacific region, not only for us, but for our target audience," Yu said.

READ MORE: China’s Alibaba targets data centres in bid to replace Amazon as cloud computing king by 2018

The initial focus for Aliyun will be to serve the cloud-computing needs of Chinese companies which are expanding their businesses into Southeast Asia.

Aliyun, which had 1.8 million customers as of June 30, is the leading provider of cloud-computing services in mainland China.

Cloud services enable companies to buy, lease, sell or distribute software and other digital resources online, just like electricity from a power grid. Data centres host and manage cloud services and applications. 

In July, New York-listed Alibaba revealed plans to invest as much as US$1 billion to build up Aliyun's network of data centres around the world.

Alicia Yap, the head of China internet research at Barclays, said in a report that Alibaba management was keen to invest in technology upgrades and new staff for Aliyun.

A survey by private equity firm North Bridge said the global cloud computing market is predicted to be worth more than US$150 billion this year.

Founded in September 2009, Aliyun has existing data centres in Hangzhou, Qingdao, Beijing, Shenzhen and Hong Kong.