Alibaba Joins Hand with SoftBank to Establish a Cloud Services Venture

The online retailer has collaborated with SoftBank to establish a cloud venture for getting access to a large number of Japanese customers

The Japanese telecommunications service provider and Chinese E-commerce company Alibaba Group Holding Limited have established a joint-venture cloud service provider known as SB Cloud to offer Alibaba Cloud’s solutions and technology to Japan based businesses. SB cloud will have its headquarters in Minato-ku, Tokyo, and will set up a datacenter to provide the online retailer’s data storage, middleware offerings, processing solutions and cloud security facilities.

In return, the Hangzhou based organization will attain access to the current Japanese customer base of SoftBank. According to CEO of SB Cloud Eric Gan, who also offers services as SoftBank’s EVP—Alibaba’s major shareholder—the organizations working on the joint project for many months before the announcement was done on 13^th May 2016.

"I believe the JV team can develop the most advanced cloud platform for Japanese customers, as well as for multinational customers who want to use the resources we have available in Japan," stated Gan. The 2 organizations have earlier cooperated on robotics, with the online marketplace operator investing $118 million in SoftBank Robotics in June 2015.

In April 2015,Jack Ma’s organization also introduced its cloud startup program in Singapore, paying a credit of $10,000 for specific startups and help from engineers of the web retailer to develop cloud-enabled applications; dedicated information technology support; and access to the associated incubators of the E-commerce organziation, industry partnerships, funding and working spaces like Hong Kong Science Park as well as Silicon Valley Association of Chinese Entrepreneurs.

In Singapore, Alibaba runs a cloud datacenter, which is also the global head office for its cloud operations. In recent times, it announced sales revenue of $3.7 trillion( $24 trillion yuan) for the 3 months ending at  31^st March next year, a growth by 39% on an annual basis. Its cloud computation business grew its sales revenue by 175% on an yearly basis to over $153 million, recording half a million paying consumers.

"Our focus on long-term strategic priorities -- globalisation, rural expansion, building a world-class cloud computing business, and creating a comprehensive media and entertainment platform -- has laid a strong foundation for future growth,"  stated CEO of Alibaba Group Daniel Zhang.

In April 2016, the company purchased a controlling stake worth a billion dollars in the Lazada Group, which is a Singaporean E-commerce operator, in order to boost its global presence: in Feb 2016 purchased shares worth $101,224,000 in Groupon and shares of Weibo worth $1.1 million, and has paid a total of $455 million on the Singaporean postal and telecommunication service provider SingPost

In March 2015, SoftBank announced it would be dividing its company into 2 distinct entities for global operations and local operations by late 2016. As per reports by Bloomberg, Japan’s third biggest phone business owner SoftBank, will have a 60% share in the newly established project while the online retailer will keep the rest.

The online trading organization previously collaborated with American management service provider Accenture Plc to aim at clients in Southeast Asia, and stated in April it would collaborate with the German organization SAP Se.