Alibaba Puts $1 Billion Towards Cloud-Building

ALIAlibaba ?BABA -1.03% , the Chinese e-commerce giant that is beefing up its Aliyun cloud business in the U.S., says it is investing another $1 billion in that effort.

The money will help Aliyun expand its international presence, beef up alliances like the one it has with data center provider Equinix ?EQIX 0.93% ?and finance the build-tout of new cloud and big data solutions, the company said in a statement.

?Aliyun has become a world-class cloud computing service platform that is the market leader in China, bearing the fruits of our investment over the past six years. As the physical and digital are becoming increasingly integrated, Aliyun will serve as an essential engine in this new economy,? Alibaba Group chief executive officer Daniel Zhang said in a statement.

Aliyun now runs five data centers in China and in Hong Kong, and it?s new Silicon Valley-based data center. The new funding will fire up new data centers in the Middle East, Singapore, Japan and Europe, according to the company.

The news comes a week after Aliyun announced a raft of cloud-based services. Alibaba?s goal in the U.S. is to help multinational companies as well as small businesses to sell to Chinese consumers.

All of this shows that Alibaba, the e-commerce leader in China aims to compete with Amazon not only in retail, but in cloud computing where Amazon Web Services leads the pack. But to put this into perspective, a billion dollars is not all that much investment in the greater scheme of things where that amount of money might fund a single data center.

In its most-recent quarter, AWS logged profit of $377 million on $1.8 billion in cloud-related sales. Google ?GOOG 0.12% ?Cloud Platform and Microsoft ?MSFT 0.31% ?Azure are two other major contenders in the public cloud infrastructure space.

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