Alibaba Cloud services revenues are nearing a $4 billion annual run rate. The figure and associated growth rates suggests the China-based technology giant may eventually leapfrog Google Cloud Platform (GCP) revenues while pursuing Amazon Web Services (AWS) and Microsoft Azure for global public cloud dominance.
Alibaba cloud revenues were US$962 million for the quarter ended December 31, 2018 -- up a robust 84 percent compared to the corresponding quarter in 2017, the company disclosed this morning. At that growth rate, Alibaba could be positioned to leapfrog Google Cloud Platform (GCP) annual revenues sometime between 2019 and 2021, ChannelE2E suspects.
(Note: ChannelE2E will update actual cloud revenue figures/estimates from AWS, Azure and GCP as each company discloses quarterly financial results in the days ahead. We'll potentially mix IBM into the conversation as well. Stay tuned.)
Alibaba Cloud: What's Driving Growth?
The company is gaining momentum with enterprise customers, Alibaba indicated. Moreover, the company launched 678 new cloud-related features during the quarter -- addressing such areas as data intelligence, AI applications, security and enterprise solutions.
Alibaba has also aligned its cloud services executive team with the company's overall technology organization. Jeff Zhang is leading the overall effort as president of Alibaba Cloud and CTO of the China-based technology giant.
Despite the momentum, I don't believe Alibaba Cloud is profitable. We'll be checking the earnings call to learn if such data points are disclosed.
Alibaba Cloud: Expanding Beyond China
Well-known in Asia, Alibaba has been expanding its cloud services into Europe while also contemplating next potential steps in North America.
Recent moves include high-level discussions with the IT consulting wing of BT (formerly British Telecom). BT could help the cloud firm compete against AWS, in particular, in Europe. The cloud company’s future looks less promising in the U.S. Rather than buck the Trump administration’s “America First” policy, Alibaba has instead pared its U.S. operations, Bloomberg says.
The U.S. and western world governments are increasingly pushing back against some China-based technology companies -- alleging that some companies could be spying for China's government and/or competing illegally on the intellectual property front. Companies generating concern include Huawei and ZTE.
We'll be watching to see whether Alibaba Cloud manages to avoid similar controversies.
Worldwide Public Cloud Services Market Share, Partner Programs
Both Amazon and Microsoft are expected to announce their latest quarterly results in the days ahead. We'll analyze updated cloud market share figures at that time.
AWS was a first-mover with MSP-centric partner programs. Microsoft launched its own Azure Experts MSP Program in mid-2018. Google Cloud Platform (GCP) also has been embracing MSPs as partners. (Related: ChannelE2E's Top 100 Public Cloud MSPs list is here.)
Alibaba, meanwhile, is laying the foundation for a global partner program.
