Alibaba Cloud, the cloud computing service arm of Chinese e-commerce giant Alibaba Group, plans to launch its first data centre in Thailand next year to capture surging demand for cloud usage in the country.
The move is expected to fire up competition in the segment in Thailand where Chinese tech powerhouses Tencent and Huawei have two and three data centres, respectively.
Thailand's spending on public cloud service is expected to surge 31.7% year-on-year to 26.8 billion baht in 2021 and grow 28.2% to 34.4 billion baht in 2022, according to Gartner, a global research firm.
"To support Thailand's growing spending on cloud services and demand for data centres, driven by the Covid-19 pandemic, Alibaba Cloud plans to launch its first data centre in Thailand by 2022," Tyler Qiu, country manager of Alibaba Cloud Thailand, said at a virtual news conference.
The company declined to reveal the investment budget or the location of the data centre.
Thailand has experienced rapid digital adoption in the past two years while the number of digital users has surpassed 57 million, he said.
Business demand for digital transformation using cloud services is also increasing.
Alibaba Cloud has provided solutions that support Alibaba Group's business, such as e-commerce, logistics and e-payment.
It has been operating in Thailand for two years with more than 30 business partners and thousands of customers.
"We don't think we are late in establishing a local data centre here because we focus on building an ecosystem and working with partners is more important," Mr Qiu said, adding there is still a huge opportunity for digital transformation among businesses.
"In order to have a local data centre, we can co-develop solutions with partners and comply with local regulation," he said.
"We aim to become Thailand's top digital transformation provider in some focused industries in the long run," Mr Qiu said.
The focused industries include retail, logistics, fintech, media and entertainment.