Alibaba Group Holding Ltd., a multinational firm from China, has reportedly said that it will be investing about 200 billion yuan (USD 28 billion) in cloud infrastructure over the span of three years. This plan has emerged after the boost in demand for cloud from software business with the peak of the coronavirus outbreak in China. Alibaba is expected to spend all its funds on the semiconductor as well as operating system development along with building out an infrastructure.
With the majority of the white-collar employees of China working from home all through February, the cloud player, which is quite dominant in the country, had experienced a major surge for the software. The jump was majorly for DingTalk which is an app for workplace chat usually used for both schools and businesses.
The users had made several complaints regarding the lag on the app at one point on account of high activities and engagement. The company later acknowledged the problem on Weibo which is a social networking site in China.
Jeff Zhang, the Cloud Intelligence President of Alibaba stated that the coronavirus pandemic scare has resulted in extra stress on the economy across different sectors overall. The company has been hoping that the investment made will greatly help businesses in speeding up their process of recovery.
According to reliable sources, the cloud division of Alibaba has come to be known as among the fastest-growing businesses. The revenue of the fourth-quarter had climbed by nearly 62% which would amount up to 10.7 billion yuan. This has been the first time it has topped about 10 billion yuan within a single quarter.
Alibaba held a 46.4% of the overall cloud market of China within the fourth quarter. Baidu Cloud and Tencent have also witnessed a surge in the demand for their products as they had held about 8.8% and 18% of the industry share respectively.