ALIBABA Group Holding is cutting prices for cloud customers outside of China by as much as 59 per cent, mirroring deep discounts at home as the once high-flying division struggles to fend off rivals and revive growth.
The move comes as Alibaba’s cloud division undergoes a far-reaching overhaul under the guidance of chief executive officer Eddie Wu, who oversees it directly, alongside the firm’s other key pillar of ecommerce.
Alibaba cancelled plans for a public offering of the cloud business in November and has been cutting prices at home to ward off rising competition from Tencent Holdings and Baidu.
The Hangzhou-based firm is China’s biggest cloud service provider, but a relatively small player compared to global leaders Amazon.com and Microsoft. It has struggled to gain any foreign ground in recent years as a crackdown on Internet firms in China and US trade curbs hampered its ability to invest in aggressive expansion.
Stockpiled chip inventories can still be used to train large language models for the next few months, however limited access to Nvidia’s best-in-class AI chips will impact Chinese companies in the short to medium term before strong domestic chip alternatives are developed.
Alibaba slashed prices on Monday (Apr 8) by an average of 23 per cent for a slew of cloud products across most of its international markets. Those discounts are now available to customers in Singapore, Japan, Indonesia, the United Arab Emirates, Germany and the US, among others. BLOOMBERG
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