Alibaba Cloud sets foot in the Philippines

Alibaba Cloud is set to launch its first datacentre in the Philippines by the end of this year as part of an aggressive plan to expand its presence across Southeast Asia.

The Chinese cloud supplier will be bringing its suite of cloud services to the country, including Elastic Compute Service, databases, content delivery network and storage services. It plans to target businesses in the financial, retail and healthcare industries.

According to the Asia Cloud Computing Association’s Cloud readiness index 2020, cloud adoption in the Philippines has yet to mature due to factors such as international connectivity, datacentre risk and cyber security, among others. Its ranking in the index fell from ninth in 2018 to 11th in 2020.

This was despite efforts by the government to encourage cloud adoption through its cloud-first policy since 2017, including procurement support to help government agencies access and compare the offerings of different cloud suppliers.

In the private sector, however, some enterprises have started deploying cloud services more widely. Globe Telecom, the largest telco in the Philippines, has moved most of its technology infrastructure to the public cloud.

It has also undertaken lift-and-shift migrations for legacy systems and is looking to develop more cloud-native applications, according to Globe Telecom’s CIO and senior vice-president, Carlo Malana.

Alibaba Cloud’s first datacentre in the Philippines will likely give it a headstart over its global rivals – which have yet to set up cloud regions in the country – as cloud adoption among Filipino firms matures.

With companies like Globe Telecom using public cloud services mostly hosted out of Singapore, a local Alibaba Cloud datacentre would help to decrease latency for applications while complying with local data protection regulations.

Elsewhere in Southeast Asia, a third Alibaba Cloud datacentre is being planned for Indonesia, providing local firms with access to database, security, network, machine learning and data analytics services.

The company said the additional facility will enable it to better support local businesses interested in adopting cloud technology and advance Indonesia’s push for a digital society.

According to Achim Granzen, principal analyst at Forrester, 45% of Indonesian firms are using public cloud to build new apps and services. Only a quarter cited the lower cost of infrastructure as the main reason for using public cloud, with time to market and access to innovation being the key drivers of cloud adoption.

Selina Yuan, general manager of international business unit at Alibaba Cloud Intelligence, said the company’s new investments were timely, “given the impact of the pandemic and the sharp rise in demand for digital business tools”.

“Equally important is our focus on talent development and nurturing a digitally-competent workforce, which we see as a key challenge for many businesses to overcome going forward,” she added.

The company has committed $1bn in a new initiative to build the region’s digital talent pool over the next three years through skills training and connecting startups with promising ideas to venture capital firms.