Amazon prepares to battle with Alibaba in Asia’s cloud

Amazon is betting it can expand its cloud computing operations in China, despite announcing just last month that it will shutter its online retail operations there.

The U.S. company announced on April 25 that its cloud computing arm, Amazon Web Services, had entered its eighth Asia-Pacific market with the opening of a cluster of data centers in Hong Kong.


“The business in China is going really well and we continue to see strong growth there,” Amazon CFO Brian Olsavsky said in an earnings call on the same day. “Launching the Hong Kong region gets us to a footprint of 19 cities in China. So it continues to be a really good story for us.”

But while Amazon is upbeat about demand for cloud services in the region, it faces a familiar rival: Alibaba Group Holding, whose grip on China’s e-commerce market Amazon was unable to challenge.

The American e-commerce giant hopes the new operation in Hong Kong will give the company a leg up in the battle for the region’s cloud services market. It is also eyeing expansion elsewhere in Asia and is confident it has a head start on rivals.

“At AWS, we keep a close eye on our competitors, but we are obsessed with our customers,” Alex Yung, managing director of AWS Greater China, said in an email to the Nikkei Asian Review. “Many large technology vendors are now trying to build a replica of what AWS has been building for the last decade.”



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