Alibaba Cloud cuts prices by up to 55% to boost AI growth in China

Ali Baba‘s cloud business on Thursday said it is slashing prices on a wide range of core cloud products by up to 55% in a bid to boost AI growth in China.

The move aims to make “cloud capabilities more inclusive and accessible in the age of AI,” Alibaba Cloud said. The price cuts take effect on Thursday and will apply to more than 100 product specifications.

“As the largest cloud service provider in China and the Asia-Pacific region, we see a huge growth prospect in China’s digital market,” said Liu Weiguang, president of public cloud business at Alibaba Cloud Intelligence.

“That’s why we decide to launch the price reduction campaign to lower the threshold of cloud services for more enterprises and developers to reap the technology dividends and accelerate the adoption of advanced public cloud services in various industries in China,” Liu said.

Interest and investment in generative AI has been booming since OpenAI launched ChatGPT in November 2022.

IN report published November 2023McKinsey explained that the highly touted technology offers opportunities for established companies.

“One is using the cloud to support generative AI initiatives. With its massive compute, storage and networking calls, generative AI needs a cloud to scale. Generative AI’s complexity, moreover, requires deployment through scalable enterprise cloud platforms rather than disjointed pilots and initiatives driven by separate development teams,” McKinsey analysts said.

Canalys predicts that global spending on cloud services will an increase of 20% in 2024compared to 18% in 2023, fueled by widespread adoption of AI applications.

“Hyperscalers are steadily increasing investment in generative AI, expecting that mastering its capabilities will catalyze new opportunities in cloud consumption,” Canalys said.