Alibaba’s Ambitious US Cloud Plans Just Got Serious

Chinese e-commerce giant Alibaba is a firm that can easily draw comparisons with its US counterpart Amazon, but not only because the two are winning the race in the burgeoning online shopping space, but because both companies are competing to become the world’s largest cloud computing providers.

Amazon has its Amazon Web Services (AWS) public cloud, a global behemoth which is expected to haul in $6 billion (£3.8bn) of revenues in 2015. Alibaba came to cloud computing a little later than AWS with its Aliyun platform in 2009. Whilst much smaller, Aliyun is the primary cloud service in China, so already has a tremendous customer base.

Alibaba has more than 1.4 million customers for its cloud services over five data centres (four in mainland China and one in Hong Kong), and is the largest IaaS providers in China with a 22.8 percent market share in the first half of 2014, according to IDC.

But Aliyun just unveiled its next move in the globally expanding cloud race, one that could easily steal prized customers from AWS, and also from rivals Microsoft Azure and Google Cloud.

Data Protection Pact

Alibaba has effectively announced that it plans to wholly protect customer data on Aliyun, and has revealed a “Data Protection Pact” that promises customers complete ownership of their own data.

Alibaba said today: “Customers…have absolute ownership over any and all data generated on the Alibaba Cloud Computing (Aliyun) platform, including the rights to freely and safely access, share, exchange, transfer or delete their data at any time.”

The move is likely to pique the interest of potential customers in the United States that are worried about the protection and ownership of their data on national cloud platforms. Ever since the Snowden revelations of large-scale data surveillance by the NSA and US Government, users have increasingly become concerned with the state of their data privacy in the cloud, and Alibaba’s oath, whilst somewhat vague (Aliyun didn’t mention how it would deal with US government data requests), could go a long way in calming the fears of privacy-conscious cloud customers.

One of the methods Aliyun is using to protect user data was outlined at the announcement in Beijing today. The company, which claims to have built the first ever analytics-driven cloud-computing security system in China, said it will analyse more than 100TB of information each day to detect security threats such as weaknesses in software programs, malware and unsafe IP addresses.

“We aim to make cloud computing the engine of the Data Technology economy, and Big Data a driving force of economic development,” said Simon Hu, Aliyun’s president. “Aliyun will continuously be committed to building a cloud-computing ecosystem to efficiently and securely serve global clients.”

At the event, Hu promised to strictly abide by this pledge to protect user data. Hu encouraged the entire industry to collectively exercise the self-regulation that is “vital in promoting the sustainable development of the Data Technology economy”.

But will customers buy it? With US-Sino cyber relations still cold, customer privacy anxiety could be forgiven, but many could be willing to give Aliyun a chance when so many others tech firms have turned their back on user privacy.

Global developments

Alibaba in March opened its first ever cloud computing data centre in the US, located in Silicon Valley. This will be Aliyun’s US expansion headquarters, and from where the firm will run its “Data Protection Pact”.

The firm further accelerated its efforts to attract global customers in June with the launch of a partner program that will offer businesses access to its full suite of cloud services.

Aliyun’s Marketplace Alliance Program (MAP) will allow the cloud division to target businesses around the world with localised cloud computing offerings as the firm looks to partner with enterprises in different regions.

“The new Aliyun program is designed to bring our customers the best cloud computing solutions by partnering with some of the most respected technology brands in the world. We will continue to bring more partners online to grow our cloud computing ecosystem,” said Sicheng YU, vice president, Aliyun.

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