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Alibaba Cloud, the biggest Chinese cloud-service provider, announced the largest price cuts in its history at 2023 Alibaba Cloud Partners Summit, effective on May 7, 2023. This is the second round of price reduction in half a month for the Alibaba unit founded in 2009. The latest adjustment affects all the core product lines, with the cuts ranging from 15% to 50%. Among them, the monthly fee of the Cold Archive storage class OSS (Object Storage Service) was lowered by 50% to RMB0.0075 per GB, while peers from Tencent Cloud and Huawei cost RMB0.01 per GB and RMB0.014 per GB respectively. Prices of RDS (Relational Database Services) with ARM architecture empowered by Yitian 710 chips, the Web Application Firewall (WAF), the Content Delivery Network (CDN) and Nat gateway were cut by up to 40%, 30%, 20% and 15% respectively, and the cloud storage services for video, the 7th Gen ECS (Elastic Compute Service) Instances and Yitan cloud instances each were trimmed as much as 20%.

"Alibaba Cloud is committed to making computing power more inclusive. This large-scale price reduction is to further give back to customers and partners with our technologies, continue to reduce the cost of cloud usage, and expand the cloud market," Daniel Zhang, Alibaba Group CEO as well as the lead of Alibaba’s cloud computing unit, commented.

Alibaba disclosed it has slashed computing costs by 80% and storage costs by nearly 90% in the past decade. "Scale effect and continuous investment in in-house technology make us confident on continued price cuts," according to the company.

At the summit on Wednesday, Daniel Zhang made it clear that Alibaba Cloud is positioned as a company to offer cloud computing products, that’s why ecology is the foundation of the company, and it has to firmly move towards "integrated products."

Earlier this month, Alibaba released its generative large language model (LLM) Tongyi Qianwen , which can possess both English and Chinese capabilities and empower the application just like Microsoft-backed OpenAI's ChatGPT. It said at Wednesday’s summit that more than 200,000 businesses have requested beta testing for Tongyi Qianwen, and Alibaba Cloud unveiled a partnership program for the model. Ten companies, including Kunlun Digital Technology, LongShine Technology, Moomoo Technologies, CICC Wealth Management, Shiji Group, Yongyou and AsiaInfo Technologies, became the first group of partners to promote intelligence application at sectors of oil and gas, power, transportation, finance, hospitality, travel, business service and telecommunications with Alibaba Cloud.

The cloud market in mainland China grew 10% to US$30.3 billion, a significant crop compared with the over 30% annual growth in the previous three years, according to Canalys, citing the impact of the Covid pandemic and its restrictions. Canalys data showed Alibaba Cloud remained the top cloud vendor in China in 2022, with 36% of total customer spending in cloud infrastructure services after growing 7% year-on-year. The market analyst firm expects Chinese cloud infrastructure services spending to increase 12% for the year 2023.

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