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Alibaba’s First Foot On U.S. Soil Is A Data Center In Silicon Valley

The new data hub will support Alibaba’s cloud services for businesses–at least at first.

Alibaba’s First Foot On U.S. Soil Is A Data Center In Silicon Valley
[Photo: Christopher Penler via Shutterstock]

As promised, the biggest Internet company in China, is making its way to the U.S. But rather than go after U.S. consumers and businesses with its various wares, Alibaba is entering the U.S. data-first.

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Alibaba is planning to build a data center in Silicon Valley–its first outside of China, according to the New York Times. Details about the size and opening date of the data center have not been released.

The U.S. data center will reportedly function to support its B2B cloud services offerings–essentially, the company’s answer to Amazon Web Services. Initially, it will be used to extend support to its China-based customers, but will eventually serve as a launchpad for the tech giant to expand globally, including in the U.S. On the eve of its record-breaking initial public offering last September, the company vowed to make such an expansion, in addition to moving into European markets.

Alibaba, the so-called Amazon of China and No. 3 on our most innovative companies of 2015 list, is focused primarily on e-commerce and–like its unofficial American counterpart–has its hands in a number of other, seemingly unrelated businesses, including cloud services.

Huge as Alibaba may be in China, its ability to capture marketshare overseas is by no means guaranteed. Explains the Times:

Though Alibaba has a significant share of the market selling computing services to businesses in China, it’s an open question whether the company can win over more foreign clients. A Chinese company first, it will have to put into place English-speaking staff members to support and sell to the businesses, while also making its software easy to use in other languages.

Still, with a labor force primarily in China, the company may be able to compete on cost. It will also no doubt get a boost from the growing number of Chinese companies that are seeking to invest and advertise in the United States.

Last June, Alibaba launched its first foray into U.S.-focused e-commerce in the form of 11 Main, an online marketplace for American goods. It’s a modest (and initially invite-only) endeavor, but as Forbes put it, the site is “meant to provide as close to an online representation of Main Street, U.S.A. as possible.” If nothing else, 11 Main can serve as information-gathering tool as Alibaba considers a more deliberate leap into an already competitive marketplace in the U.S.

About the author

John Paul Titlow is a writer at Fast Company focused on music and technology, among other things.

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