Alibaba Group Holding Ltd To Help Foreign Firms Do Business In China

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Alibaba Group is offering a helping hand to tech companies such as SAP SE that are keen on having operations in China, a massive market that is strictly against foreign technology. China’s largest e-commerce company is looking for new areas of growth with the intent of combating a slowing economy at home.

Helping foreign firms penetrate China

Alibaba is looking to offer its help to tech companies to help them comply with local regulations and sell their products. The company will use its cloud computing platform for its new AliLaunch program, which can help clients with joint ventures and marketing. Germany’s SAP is the biggest customer so far, and it will sell its Hana data-software and services on Alibaba’s cloud.

Alibaba Vice President Yu Sicheng said at a conference in Beijing, “Alibaba Cloud is able to help its overseas technology partners comply with data security laws in the country.”

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Signing up 50 partners over the next 12 months is what the company is aiming at.

The key to success in the domestic market is securing an influential Chinese partner. Last year, China said it will block software, servers and computing equipment, and since then, it has championed homegrown services over foreign technology. The ability of U.S. companies to benefit from China’s $465 billion information products market has been threatened due to tightening regulations on everything from data to content.

Alibaba betting big on cloud

Alibaba’s fastest-growing business is its cloud division, though it contributed just 4.7% of revenue in the March quarter. But it is a primary driver of growth over the longer term. The “global technology partners marketplace” is yet another program the company launched to allow tech companies to get their services integrated with and hosted in its cloud.

Sicheng Yu, general manager of Alibaba Cloud Global, said, “The AliLaunch program and Global Technology Partners Marketplace serve as the perfect platforms for making different software products accessible to businesses and organizations in China.”

It can be said that Alibaba is hoping that foreign firms will use its expertise in negotiating the local market, both in terms of what it calls “technology compatibility” and Chinese compliance regulations. Alibaba Cloud boasts more than 2.3 million customers, of which more than 500,000 are paying customers.

To boost its next-decade growth, Alibaba is betting on Internet-based computing and big data. Providing real-time comments for basketball games and public sentiment and predicting traffic are what the company intends to do, for which it is exploring artificial intelligence.

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Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at [email protected]
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