Alibaba teams up with Nvidia

ALIBABA Group Holding will work with Nvidia on cloud computing and artificial intelligence, and plans to enlist about 1 000 developers to work on its big-data platform during the next three years.

The arm of China’s biggest e-commerce operator, known as AliCloud, would boost investment in data analysis and machine learning, it said in a statement yesterday.

AliCloud is staking $1 billion (R16.7bn) on the belief that demand for processing and storage from governments and companies would boost growth during the next decade as its tried to compete with Amazon.com in computing services.

The investment also reflects Alibaba’s own appetite for information processing as China’s online-retail market grows to 10 trillion yuan (about R25trln) by 2020, according to Bain.

The push into cloud computing, where software and services are provided to customers via remote data centres the size of American football fields, prompted Alibaba to open its second data centre in Silicon Valley in October and prepare its first in Europe.

Fastest growth

“AliCloud’s rate of growth is one of the fastest among global peers,” Simon Hu, the division’s president, said in Shanghai. “Apart from being fastexpanding in Asia, we will also maintain our growth in Europe and the Middle East.”

AliCloud is extending its scope beyond basic cloud-computing services. It co-founded a quantum computing laboratory with the Chinese Academy of Sciences to help secure its data centres and develop machines capable of faster calculations.

The company would team up with Nvidia to provide customer support in the areas of deeplearning and high-performance computing, AliCloud said.

AliCloud generates revenue mostly by charging clients a fee for using its computing infrastructure. For now, it contributes a mere sliver of total revenue, with computing and internet infrastructure accounting for 3.1 percent of sales in the June quarter, according to data compiled by Bloomberg.

The business could account for more than $1bn of Alibaba’s revenue by 2018 and the public cloud presents a $120bn global market opportunity, according to SunTrust Robinson Humphrey.

By comparison, Amazon Web Services’ revenue rose a better-than-expected 78 percent to $2.1bn in the third quarter. – Bloomberg