Alibaba will sell Salesforce's cloud-based products to its customers in Asia, as US-based company hopes to double revenue by 2023 According to IDC, China will be world’s largest cloud market by 2023. Salesforce, a leading US cloud services company, has partnered with Chinese eCommerce company Alibaba to expand its footprint in the Asian software market, amid US-China trade war. Alibaba will exclusively sell Salesforce’s cloud-based software to its customers in mainland China, Hong Kong, Macau and Taiwan, said Salesforce in a blog post. According to Salesforce, the deal has been motivated by its multinational customers who are increasingly asking for support “wherever they do business around the world.” There’s another motivation. Salesforce has big ambitions for growth, the company wants to more than double its annual fiscal revenue to as much as $28bn by 2023; because its recently seen slowing growth, successful expansion into the Chinese market will be very helpful. AI/machine learning needs lots of data. Is China at an advantage in the AI race because of GDPR? Will the UK and Europe be left behind? According to IDC, China will be the world’s largest cloud market by 2023. Growth of China’s public and private cloud markets is also about twice that of the global growth rate. By 2023, the country is expected to represent 25% of the global market, passing the US to become the world’s largest cloud market. Roughly 10% of Salesforce’s revenues in the three months ended 30 April 2019 came from Asia, compared to 20% from Europe and 70% from the Americas. In China, Alibaba’s cloud business dominates more than half the market, which is estimated to grow 55% to $331.2bn in three years, according to Gartner. The partnership comes after a number of Salesforce’s competitors stated that US-China trade tensions were problematic for business. In May 2019, Oracle, the American software company, fired 900 staff from its China team, making up 60% of its research and development effort there, according to some employees, tensions between the US and China partly caused the cuts. While SAP, the European software firm, blamed US-China trade tensions for disappointing second-quarter results that sent its shares sliding. According to O’Reilly Media, Europe is at significant risk of falling further behind its global counterparts when it comes to cloud adoption
Salesforce has partnered with Alibaba to expand into the Asian software market in a bid to double revenue within four years to offset a recent slowdown in growth. Alibaba will sell Salesforce software in mainland China , Hong Kong , Hong Kong and Taiwan . With a growth rate that is double that of global growth, China is forecast to overtake the US and become the largest cloud market in the world by four years , accounting for more than half of the global market, according to Oracle . Meanwhile, the US - China trade war has been blamed for staff cuts at Oracle and disappointing Q2 results from Alibaba .