The Chinese tech giant Alibaba has said that it will invest USD 28 billion in cloud services over the next three years. The announcement came amidst the increased demand for cloud services due to coronavirus outbreak. This will help company expand its cloud business to more countries. The company will spend the allocated amount over the next three years on semiconductor and operating system development as well as on building data centre infrastructure. The company is planning to build more data centres so as to complement an existing data centre network that covers 21 regions around the world.

“The pandemic has posed additional stress on the overall economy across sectors, but it also steers us to put more focus on the digital economy. By increasing our investment on cloud infrastructure and fundamental technologies, we hope to continue providing world-class, trusted computing resources to help businesses speed up the recovery process, and offer cloud-based intelligent solutions to support their digital transformation in the post-pandemic world,” said Jeff Zhang, president of the Alibaba Cloud Intelligence division in a statement.      

As most of the white collar employees in China are working from home for the last few months, Alibaba saw huge usage surge for its software services, particularly DingTalk, a workplace chat app that is used by both businesses and schools. Many users also complained of lags on the chat app due to the high traffic on the application.

Cloud computing is now Alibaba’s fastest-growing business segment beyond the traditional e-commerce business. Although  Alibaba is behind AWS and Azure as the third-largest public cloud provider globally, its growth is much higher than its competitors. Alibaba Cloud’s growth rate for the quarter that ended December 31, 2019 is 62 percent. Currently, Alibaba  is the leading cloud provider in Asia. The quarterly revenue of Alibaba Group’s Alibaba Cloud has reached USD1.5 billion.