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China’s cloud spend soared by 67 percent in Q1, but COVID-19 didn't exactly help matters

Country total of $3.9bn is about 40 percent of AWS revenue, but Amazon sells to the world

China’s spend on cloud infrastructure services in Q1 2020 jumped 67 percent year-year, says analyst firm Canalys.

That great leap cloudward saw US$3.9bn change hands, with the lion’s share (well 44.5 percent) going to Alibaba, followed by Huawei (14.1 percent), Tencent (13.9 percent), Baidu (8.6 percent) and the ever-present “Other” with 19 percent of the market.

Canalys chief analyst Matthew Ball said that plenty of the increased spend was attributable to the COVID-19 pandemic making off-premises infrastructure mighty useful. But he also observed “some large, complex and consulting-led projects were disrupted due to workplace shutdowns, which also affected negotiations and bidding processes.”

Ball also described how China’s big clouds are developing their own personalities:

  • Alibaba Cloud benefited from the surge in users collaborating on its DingTalk platform during lockdown, which peaked at 155 million daily average users. That’s fallen back to 100 million since re-opening commenced;
  • Huawei Cloud “built its strength on establishing DevOps and industry-focused platforms as well as winning large government contracts”, and did well with internet and video content providers;
  • Tencent’s video meeting platforms boomed during lockdown and it’s now growing AI, blockchain and security capabilities with a US$70bn war chest to make it happen;
  • Baidu “maintained its momentum in Q1 2020 and continued to outpace the market, winning deals incorporating facial recognition and its recently launched AI PaaS.”

All of which is very impressive … although a quick look at the scoreboard offers some perspective because AWS Q1 revenue was $10.2bn.

Canalys thinks there are more nice numbers in the pipeline for China's clouds, thanks in part to Chinaa's stimulus measures and policies that call for cloud adoption to accelerate uptake of 5G, AI, electric vehicles, IoT and robotics. ®

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