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China's clouds boom but they're collectively earning less than Azure alone

Alibaba in front with Huawei and Tencent on a second tier

China's clouds grew by 65 per cent in 2020's third quarter, collectively hauling in $5bn of revenue in the period.

So says analyst firm Canalys, whose best estimates suggest spending grew by $750m compared to 2020's second quarter and $2bn year-on-year.

Some of the surge was attributed to "restarting of delayed projects" that were shelved during pandemic-induced lockdowns, especially in the hospitality and transportation sectors that were hard hit by lockdowns.

The firm suggests that China emerged from the pandemic with "renewed focus on digital transformation" and rapid economic recovery.

All of which added up to lots of demand for cloud infrastructure.

Canalys chief analyst Matthew Ball said demand was driven by remote learning and working, gaming, streaming and e-commerce. "This, combined with the digitalization of processes and operations within enterprises and government organizations, will maintain demand," he said.

Alibaba Cloud

Alibaba Cloud on the cusp of turning a profit after growing 60 per cent in a year


Alibaba is the nation's leading cloud with 40.9 per cent of the market and Canalys said it has done well in finance and retail. Huawei enjoys 16.2 per cent market share, thanks to what Canalys described as "rapid growth in the finance, industrial manufacturing, Internet and government sectors."

Tencent's 15.8 per cent share was helped by rising demand for PaaS. Baidu is the fourth-placed cloud, with 7.1 per cent share but strength in the transportation, healthcare and financial sectors.

Some perspective: China is home to 18.5 per cent of the world's human population and its $5bn cloud spend is 13.7 per cent of the global total. Microsoft's Azure alone, at around $6.9bn per quarter, is bigger than all of China's clouds combined. ®

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