Alibaba's Increasing Cloud Data Center Footprint

It would be much too much of an understatement to say that Alibaba is on a roll -- but it is.

Let's forget the company's 2014 IPO, which raised $25 billion and was the largest IPO in history, and only look at ways the company has made news this year. In April, for instance, it passed Walmart to become the world's largest retailer. In online sales, it's gross merchandise volume -- which is how e-commerce folks count revenue -- surpasses Amazon and eBay combined. And the scary thing is, since 2015 the company's online sales and profits have been greater than all US retailers combined -- a figure that includes Walmart, Amazon and eBay.

Not only that, but since 2009 it's been a public cloud provider with its subsidiary Aliyun (or AliCloud). It's no AWS -- not yet -- but it's serious about growing. According to TechCrunch, it's nearing the break-even point as it spreads its cloud operation throughout Asia -- and the world.

Needless to say, packing that much power in e-commerce and cloud requires more that a dozen or so rusty IBM XTs strung together Halt-and-Catch-Fire style to meet demand.

On Tuesday the Chinese data center company GDS (which itself went public last year) disclosed that it has inked a deal that will see Alibaba take full-capacity of its Beijing 3 data center, which is currently under construction and slated to open in the first half of 2018. When completed, the facility will offer 45,854 square feet of technical space.

"We are pleased to announce this new pre-commitment by Alibaba, one of our most important strategic partners," said William Huang, GDS Holding's chairman and chief executive officer in Tuesday's press release. "The Beijing 3 site is adjacent to our Beijing 1 data center where Alibaba already occupies a substantial part of the total area. It is an ideal expansion location for Alibaba’s growing capacity needs."

No dollar -- or Yuan -- amount has been announced yet, but it appears to be enough to put smiles on the faces of GDS's execs.

The announcement doesn't come completely out of left field. Alibaba's been talking a lot about expanding its data center footprint recently.

In May, the company announced plans to build a data center in Malaysia, the country's first large-scale public cloud platform, "to provide enterprises in Malaysia and the region with powerful, scalable and cost-effective cloud capabilities to support their global expansion." Then earlier this month, Alibaba used its Computing Conference in Shanghai to announce that it's planning on launching data centers in both India and Indonesia, both of which it plans to have online before the end of the current fiscal year, which ends on March 31, 2018.

Alibaba's cloud service currently has 14 data centers in operation, with two being in the US, in Silicon Valley and Virginia.