Amazon Raises Its Game Against Alibaba, Will Expand AWS Cloud Services To China In 2014
Another step ahead for Amazon in its bid to become the world's biggest cloud computing platform for businesses, and to specifically take aim at a big regional competitor in Asia, Alibaba.
Context & Ripple Effects
Amazon's announcement that it will bring AWS to China in 2014 via a new Beijing region turns a US-centric cloud platform into a direct competitor on Alibaba's home turf. The relationships on record confirm both the expansion and the framing: Amazon explicitly positioning the region to take aim at Alibaba in Asia's cloud market.
The story traveled unusually wide for a regional cloud launch — pickups at the Wall Street Journal, The Register, Gigaom, ZDNet, GeekWire, Gigaom's peers and the official AWS blog all landed the same day — signaling that analysts read it as an opening salvo in a cross-Pacific infrastructure rivalry rather than routine capacity building. It came a day after AWS shipped its Kinesis streaming service, part of a rapid cadence of platform additions heading into 2014.
First-order effects
- Multinationals running operations in China gain the option to keep workloads on AWS inside a Beijing region instead of splitting vendors, while Alibaba now faces the world's largest cloud operator selling directly into its domestic market.
- AWS's China entry forces compliance with local hosting and licensing structures from day one, making the Beijing region a test of whether Amazon's global playbook translates under Chinese regulatory conditions.
Second-order effects
- Alibaba is pushed into a defensive investment posture for its Aliyun arm — defending share against a rival with deeper global reach rather than competing mainly against local providers.
- Other Western cloud vendors face pressure to decide whether to follow Amazon into China through their own regions or concede the multinational-in-China segment to AWS.
Third-order effects
- If the pattern holds, cloud computing splits along national regulatory lines: providers win enterprise customers not just on price and features but on which jurisdictions they can legally operate data centers in, making sovereign-market access a core competitive asset.
- A two-sided dynamic takes shape where each platform's home-market strength funds expansion into the other's territory — a structure that invites both competitive escalation and eventual political friction over foreign cloud operators.
The trend: Cloud infrastructure is becoming a bilateral contest between US and Chinese platforms, with each side's home-market dominance bankrolling pushes into the other's region.