When one think of the biggest E-commerce websites, he/she must not forget to mention “Alibaba”, the most visited Chinese website. According to 2004 survey report, it has held $25 at NASDAQ.
Entry in cloud computing:-
In 2006, Amazon launched cloud computing, following them Alibaba entered the business in 2009. Its cloud computing efforts are one of the best developments in the business.
Different markets:-
It is difficult to compare E-commerce giants “Amazon” and “Alibaba”. The first one is popular in America while the later one in China. Both the markets are different.
NASDAQ listings:-
NASDAQ listed both companies’ shares as Amazon taking the lead by $400 billion, while Alibaba’s market capital exceeds $250 billion. Both companies are trying hard to dominate other in offering cloud services to users.
In 2015, Alibaba decided to expand its business outside China with billion dollar investment. While talking to the media, Alibaba Cloud’s president Simon Hu predicted that their company will take over Amazon in few years in all forms of technology.
Emerging website:-
Alibaba has emerged as biggest website outside Asia particularly China. Alibaba Company is emerging as a global leader in cloud computing business.
Increasing number of users:-
Alibaba is increasing its customer’s circle from the marketplace and branded mall to digital banking that counts approximately 500 million customers. They will face many hurdles if they desire to establish their business outside China.
Alibaba’s cloud unit is on the annual rise for its last seven quarters including 115% in its December report. In the recent quarter, the company has reached $1 billion run rate mark courtesy of $254 million revenue.
As compared to Amazon, that grows at 47% rate mark courtesy of $3.53 billion total income for a run rate over $14 billion.
Alibaba Company revealed its future plans. While talking to the conference they emphasized greatly on the user data protection at a computing conference held in Hangzhou, China on Oct 14, 2015. They promised their users to provide them better services than Amazon and is planning to emerge internally.
Amazon and Alibaba have no competition so far, it has to go a long way to beat the Amazon.
Synergy Research Group has published a report which says that Alibaba is currently in the sixth position after Amazon, Microsoft, Google, IBM, and Sales force. The statistics are made on the following basis:-
- Cloud services
- Infrastructure
Alibaba has gained the sixth position in the world in terms of revenues in the fourth quarter of a calendar year. IT giants like Microsoft and Amazon are among the top five list, Alibaba is leading the list beating China Telecom Company. Synergy chief analyst said in an interview that Alibaba market share is running at 40% increase.
According to Alibaba, the cloud unit counts approximately 765,000 paying customers of the last quarter. There is a probability of an increase of 114,000 customers in the previous quarter.
Establishing outside China:-
Many experts are agreeing with the Synergy report as the number one cloud computing in China. Company’s global GM Ethan Yu is optimistic about the company’s global growth, at the same time he also accepts Amazon as a global leader.
Ethan Yu said in an interview that their market is getting bigger in China as they are leaders in cloud computing. They need to work more on the service. He believes 2015 was the much greater year for the company.
He also added: “I think 2015 is a year of revolution in the cloud computing business, where most Chinese firms are compelling to use this service. The company is focusing on establishing its business outside China. China is the world’s biggest market. Cloud computing has just started now, which is a good sign. We believe our company van do much better outside China. We have 14 global data centers, out of them 8 are established outside China”.
The major factor- US market:-
Alibaba has started his business with few customers like his business rival. The company is optimistic of handling large customers based on its efficiency to handle big businesses and e-commerce setups.
The company is facing another challenge as the elected president Donald Trump has set some restrictions on the trade with China. But Yu is optimistic; he believes that the company’s position is secure. Only friendly relationships will be beneficial for both the nations.
The company is hopeful to gain a better position in U.S. Jack Ma, Executive Chairman announced to create one million new jobs in the states.
The details are not provided by the Chairman on how to achieve that target. According to media reports, Money Gram is acquired by Alibaba's Ant Financial for $880 Million.
Company’s objectives:-
The Ant Financial and cloud unit that are close to raising $3 billion in debt funding are in consideration for future projects. The company is doing a great job. The company’s major plan is to become a global leader in cloud computing, not depending upon the China’s market. Those services accounted for 87% of the RMB 53.25 million.
The cloud computing technology contributed $215 million to the figure with a loss of $49 million. The company’s revenue was 50% in the previous quarter alone and 115% on the previous year.
This growth is likely to be impressive. It would require years to reach $1 Billion per quarter. The company is planning to expand its business activities in countries like Australia, Japan, Europe and the Middle East. It has also increased its capacity in Hong Kong.
Not relying solely on the Cloud services:-
The company is not focusing on the cloud but is exploring new revenue methods. The company has made a deal with Paytm, India’s top wallet company, which was previously associated with famous E-commerce website Snapdeal. The Chairman is interested in expanding his business in India.
Last year, Alibaba signed a contract with Lazada, the largest E-commerce site in Southeast Asia, having a population of 600 million users. According to 2006 Google report, e-commerce business in Southeast Asia will rise to $88 billion by 2025. Alibaba has already captured the Asian market, leaving behind Lazada, the biggest e-commerce site in Malaysia.
It is not impossible for Alibaba to expand its global reach and take over the Amazon.
