Can Alibaba Put the Hurt on AWS and Microsoft Azure?

Chinese web giant Alibaba is pushing its web services worldwide, aiming to displace industry leaders.

Frank J. Ohlhorst, IT Consultant, Editor-at-Large

June 1, 2018

3 Min Read
Business Arm Wrestling

In the land of the MSP, it takes more than building a better mousetrap to grow business; more often it is the mantra of “better, faster, cheaper” that brings forth new opportunities.

Chinese internet giant Alibaba hopes to take that to heart and become the player of choice for MSPs seeking alternatives to industry leaders such as Amazon Web Services, Microsoft Azure and Google Cloud. It’s a strategy that’s already in play in Europe as the company has added data centers across the continent in hopes of engaging more customers.

“We are talking a lot with local clients about digital transformation including retail, logistics, finance,” adding: “Everyone is talking about digital transformation,” said Yeming Wang, general manager of Alibaba Cloud Europe, in an interview with CNBC earlier this year.

Alibaba Cloud is among the world’s top three IaaS providers, according to Gartner, and the largest provider of public-cloud services in China, according to IDC. It’s now the is the official cloud-services partner of the International Olympic Committee. According to The Motley Fool, over the past four fiscal years, Alibaba Cloud’s revenue has grown by 64 percent, 138 percent, 121 percent and 101 percent, respectively. For the year ended in March, Alibaba Cloud’s revenue hit $2.1 billion; yet, even with such impressive revenues and its status as the No. 3 worldwide IaaS provider, Alibaba pales in comparison to other industry leaders, with just 3 percent of the market, compared to AWS’s 44 percent and Azure’s 7 percent, according to Gartner estimates.

While the company is on a growth trajectory and is garnering market share in Europe, MSPs must wonder how that bodes for the U.S. and if there are any opportunities to be had there. The answer to that might lie in how Alibaba Cloud is looking to take on the American market. The company already has data centers in Silicon Valley and Virginia, and is partnering with U.S. companies including Nvidia and Cisco on cloud data-center technology.

Alibaba made its intentions to compete globally with AWS and other major cloud providers with a $1 billion investment back in 2015, and it’s still clear today that the company is eyeing a larger slice of the cloud-services pie. That leaves many wondering whether Alibaba Cloud computing can offer better value than AWS. But quickly determining value can be complicated, if not impossible. Alibaba Cloud ECS and AWS EC2 comparison pricing is impossible, simply because pricing varies between different instance types, and no instances from the two companies are identical.

Perhaps value will be determined by Alibaba’s growing channel programs, which highlight several major channel partners, all of which are looking to grow their market penetration. The company’s MAP program offers opportunities to those looking to become Alibaba cloud resellers or web application development partners, outlining a clear path for MSPs looking for new opportunities. The question remains, will MSPs be enticed by Alibaba’s claims of competitiveness or will they stick with the current industry leaders Microsoft and Amazon?

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About the Author(s)

Frank J. Ohlhorst

IT Consultant, Editor-at-Large

Frank J. Ohlhorst is an award-winning technology journalist and technology analyst, with extensive experience as an IT business consultant, editor, author, presenter and blogger. He frequently advises and mentors technology startups and established technology ventures, helping them to create channel programs, launch products, validate product quality, design support systems, build marketing materials, as well as create case studies and white papers.

Mr. Ohlhorst also has extensive experience assisting businesses looking to launch analytics projects, such as big data, business intelligence and resource management. He also has taken on contract roles as a temporary CIO, CTO and data scientist for startups and new ventures. Mr. Ohlhorst also provides forensic services for data security and assist with compliance audits, as well as researching the implications of compliance on a given business model.

Mr. Ohlhorst also has held the roles of CRN Test Center director, eWeek’s executive editor, technology editor for Channel Insider, and is also a frequent contributor to leading B2B publications.

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