Amazon and Alibaba Go Head to Head in Cloud Services

Photo of author

By Jacob Maslow

cloud computing conceptIt looks like Alibaba (NYSE:BABA) is trying to copy That is kind of an impolite way of describing Alibaba’s strategy. One can’t help but come to that conclusion based on the fact that Alibaba is planning to open a Silicon Valley data center. This is a page straight out of’s playbook. It appears that Alibaba also wants to be a big cloud services provider in the United States.

It is easy to see why it was inspired by Amazon (NASDAQ:AMZN) to make this move. Several years back, Amazon had a lot of data center capacity. It had to have this huge hardware footprint so that its online commerce platform could perform smoothly. It noticed, however, that for a large chunk of the month, its hardware infrastructure was operating well below capacity. Amazon decided to rent out this computing firepower as well as its distributed content hosting and distribution system. Amazon Web Services was born.

Fast forward to today and Amazon is now one of the biggest players in the commercial cloud services market. It appears that Alibaba wants to do the same thing. The big difference is that its data center is probably not going to do much. It has to have data centers all over the world for it to step up to the scale and the infrastructure firepower Amazon has at its disposal. Still, given Alibaba’s market valuation and its huge sales volume from China, it is definitely a company that is up to the job. If there is any one e-commerce player that might be able to steal Amazon’s glory, it might be Alibaba.

Images Courtesy of DepositPhotos

Comments are closed.