Foreign investors finally realized that Ali cloud threat to the Amazon cloud.
Today, Business Insider citing Goldman Sachs research report released Tuesday pointed out, AWS is not a real competitor in the United States, but from China's Alibaba.
Goldman Sachs pointed out that Alibaba's cloud computing services, namely, Ali cloud, 2019 revenue will reach $ 5 billion, then the enterprise value will reach 42 billion US dollars, while the enterprise value for AWS then $ 178 billion. In contrast, Ali cloud remains small. However, this was enough to bring Ali cloud cloud computing infrastructure sector (IaaS market) has become the second largest company. Research report said:
Such a value point of view, AWS and Ali cloud will become the world's two largest infrastructure technology companies.
Ali cloud quarter revenue year on year growth rate of 140% over the past 12 months, total revenue was approximately $ 600 million, over the same period of the computing business with Google Cloud estimated similar results. But Ali cloud still not profitable last quarter operating margin was 35%, while AWS operating margin reached 30%.
Alibaba CFO Bue in the second quarter earnings conference call revealed that Ali cloud industry is already very close to breakeven. Ali cloud currently 57.7 million users, until users reached 1 million, when will be the time Ali cloud began to profit.
Ali goes to emerge in the international arena, the two close combat
Cloud services in the international market, many analysts believe Amazon Cloud two main rivals Microsoft and Google. Even so, in the IaaS market, and they are still a considerable gap between the Amazon, as Business Insider pointed out earlier, Amazon cloud services in rolling Microsoft and Google.
Thus, Wall Street analysts did not seem to be the king of the Amazon with Na Ali cloud contrast. Only in China, more familiar with Ali cloud customers aware of its potential, GF Securities as early as October 2015, pointed out:
In many domestic companies, Alibaba's main business is similar to the Amazon before, for e-commerce, so the software and hardware technology and accumulated most similar to Amazon. Ali cloud services are currently being considered by many domestic users with the most similar to AWS. We believe that Ali cloud the future in specific market segments, such as government cloud markets, could get a place by virtue of its technical strength.
However, Ali cloud continued staggering growth rate, so that Wall Street analysts can no longer ignore the rising star. In July this year, Gartner published Magic Quadrant for global cloud services market, Ali goes on for the first time entered the list.
Goldman is not the only cloud Ali noted the enormous potential of the Wall Street investment bank. Baird Equity Research in a recent research report pointed out that Ali cloud still many investors & ldquo; & rdquo ;. underestimated However, Wall Street investment banks optimistic, it seems that Ali cloud focus on the Chinese market, not its performance in the international market.
Because of preferential government policies, regional market focus, market operators Alibaba core platform of experience, as well as Taobao and Tmall benefits in the SME market, Alibaba has a good position, will become China's cloud computing market leader.
Market research firm SunTrust is also due to the growth potential of the Chinese market cloud services, while promising Ali cloud the future of the business continue to grow.
As for the performance in the international market, Gartner analysts believe that, as a cloud service provider, Alibaba low visibility and mindshare in the enterprise customers outside of China; and its independent software vendor (ISV) and channel partners are mostly outside China there is no influence of Chinese local enterprises.
But in fact, the Amazon cloud with the official arrival China, Ali cloud the pace of international expansion to accelerate, both international and Chinese cloud services market has begun to close combat Bazhe, while cloud computing rivals also increasing, the future of cloud computing market how to go to war?
IaaS market rely on price war to expand market share
As Goldman Sachs said that the two cloud providers currently the biggest advantage in the IaaS market, as most burn segments, this is indeed to big companies like Amazon to Ali and affordable.
However, cloud services market players have been more and more, in addition to start-up companies, many of them huge capital strength of large enterprises, higher upfront investment, long payback period of the IaaS market, these companies have to catch up with the leader of the capital. Therefore, in the latest IDC report noted, IaaS provides servers, storage and network services and other services high degree of homogeneity, leading to major service providers in the fierce price war to gain market share, rather than trying to profit at the current stage.
The interface News finishing the last two years, Ali goes at least 6 times announced price cut cloud server (ECS) and cloud database (RDS) products, including ECS highest decline of 25% and 20%. Only a year Ali cloud ECS product cumulative decline of 61%. Meanwhile, more than Ali cloud, the whole market has been lower prices. Second half of 2015, Tencent Ali clouds and cloud even come free six month trial of discount policy.
GF Securities also pointed out that the team, AWS sales growth may over-reliance on the price, published from 2006 to April 2014, Amazon announced a total of 42 times the price, an average of five times a year or more. Microsoft Azure and Google Google Cloud Platform at different times along with the initiatives taken by the price. However, Amazon's cloud services, is still notoriously expensive.
The next stage will be the vertical dispute and ecological construction
If in today's IaaS market, common infrastructure services market competition little space, vertical markets are under development. Large companies will be more modular basis to provide services, a number of start-up companies in the segment is selected verticals cut.
In recent years, more and more corporate demand for cloud is also more vertical and scenes of, IDC found that, Ucloud, Yun and other start-ups in their respective areas of strength has a place, are also rising fast.
As can be seen from the latest report released by IDC, cloud services vertical market, China still has much room for development, one of which is the cloud service battlefield: the more competitive vertical field, the less market share occupied the first three giants and the initial stages of the financial, educational, and medical segments still developing, the three giants occupied most market share in the future the situation may be reversed.
Jinshan Yun business growth last year was the first Chinese market, showing confidence in the vertical field when Kingsoft CEO Chiang Chang is also an interview with Bloomberg: & ldquo; In the game, the image of cloud computing and healthcare, we are well-deserved leader. So I am very confident that we can get your place in the cloud field. & Rdquo;
IDC also reports summarize market is still the initial stage, more and more companies to join the competition in the market. IaaS providers (young cattle, Albatron) and vertical platform providers, such as video (music as), advertising analysis and instant messaging (financial cloud) will be competing to attract Chinese developers.
On the other hand, as the cloud services market, more and more capital and technology giants have joined Amazon and Ali cloud in the gap with other technology vendors will be gradually reduced to provide products with the maturity of the market will be convergence Therefore, we want to keep customers, perhaps more importantly, to provide a better ecological and create their own brands.
IDC in the report suggested that the construction of ecological systems help business development, in addition to competition in the SME market, service providers have begun to penetrate the enterprise market through the output and partner promotion. It believed that the next stage of competition in the market will be competitive ecosystem.
Internationally, the problem with the Amazon AWS ecological data expansion and loyalty of the more obvious advantages, many developers recognized user-friendliness of the Amazon; in the country, Ali has the most comprehensive ecosystem, but the user experience is generally believed. For policy reasons, even if AWS landing in China, it is difficult to provide the same with its international ecosystem, which AWS China could be a need to focus on resolving the problem.
Meanwhile, Amazon China also talk to Microsoft faces similar challenges,36 Krypton noted in previous reportsFrom basic technical terms, Microsoft may Bie Li slightly better, but Ali in marketing and promotion willing to under the original capital, but also in terms of price quite an advantage.
OF tiger sniffing the wind Xiaoxia noted that the ratio of R & D and marketing costs Silicon Valley's most cloud service is 1: 3, in everyone's products are very similar situation, the company has made cloud service brand in force.
He concluded, due to the characteristics of the B-side of the market, the market should also go through the cloud technology-driven, product-driven to drive the sales process.
Opinion, or a burn war.