Alibaba Cloud Enters Europe

Wednesday, February 19, 2020

You will have probably heard of the internet giant Alibaba before. But for those who have not, the e-commerce company is one of the biggest in the world, located firmly in the top tier alongside Amazon, Google, Microsoft and Facebook.

Founded back in 1999, the company has come a long way since then. The exponential growth it has shown looks to not be slowing down anytime soon, with the announcement that the Alibaba Cloud was moving into European markets.

This article today will go into a bit more depth about Alibaba Cloud’s entrance into the European market and the activity this has created.

Specifically, Alibaba Cloud opened two datacenters in the UK’s capital London, with the goal of serving business clients in the area. These facilities coincide with bases in Frankfurt and Dubai and look to be a move to position themselves around a certain unknown in the market now that the UK has left the EU.

The importance of the UK market for the Alibaba Cloud was pivotal in the decision to build these data centers in London. It was one of the fastest growing European markets for the business with clients across key sectors. The services to be rolled out from these data centers includes elastic computing, which will help to mitigate times of heavy usage within the network, as well as application services, big data analytics, and storage - alongside others.

But before we go any further, just what is Alibaba Cloud?

The Alibaba Cloud offers a range of cloud computing services around the world, it has a two-fold purpose. This first is empowering customers with online businesses from around the world, as well as driving the Alibaba Group’s ecommerce solutions. They are the second biggest hosting company in the world, meaning they bring some serious weight to their operations and can compete fiercely with all market leaders.

What does the Alibaba Cloud entrance mean for European markets?

There are a couple interesting points to pay attention to here. The first is that Alibaba is a genuine global competitor for the biggest brands - and a direct competitor of Amazon and Microsoft. Time will tell how this will play out between these three, they already compete fiercely across Asian markets, and this move looks like Alibaba would like to push the markets across the globe.

One of the reasons Alibaba has become so successful is the way it operates. As opposed to other internet giants, it clearly has an approach that puts business metrics at the forefront of priorities. This is compared to the technology-first approach we see in a lot of providers such as Microsoft and Google.

This becomes interesting on a couple fronts, not only for Small Medium Enterprises (SMEs) but for larger business operations that always have economics and their bottom line in mind. The Alibaba Cloud is one of six offerings of the Alibaba Group. Essentially, the cloud is an information management system between the other sections which focus on: Sell, Buy, Pay, Deliver, and Fun. Between all of them they try to offer a complete services package for clients.

By being a part of this ecosystem, markets within China and Asia are opened up much easier to businesses. So while Alibaba is moving into Europe, it is hoping to make the markets it has direct access to easier for European clients to enter as well. This quite possibly will cover UK businesses that already have affiliations with China, as well as ones looking to establish them.

This is an interesting occurrence, which could lead to competition having to establish their position within the market very firmly. What could this mean for consumers and businesses? Quite possibly, cheaper prices that come from more providers in the industry.

Considering the size and influence of all the players within the IaaS European market, there could be a long time before we really see the impact of the Alibaba Group’s move into Europe. Their competitiveness on pricing, business focused approach, and access to wider markets will undoubtedly be an appealing offer to many people, businesses and enterprises alike. How other rivals such as Amazon, Microsoft, and Google respond, will be fascinating to watch and will likely drive innovations for years to come, which is a great bonus for the consumer.