More than a year ago, Alibaba CFO Wu Wei told investors about the company’s cloud business. “China will become the largest economy in 10 years, and enterprises and millions of businesses will migrate to the cloud.” She predicted Alibaba Cloud’s annual growth rate can reach 50%. But this forecast is clearly too optimistic. Alibaba Cloud’s annual growth rate was 12% in the first quarter of this year , while arch rival Tencent’s cloud business contracted. Public cloud accounts for 60% of China’s cloud market and private cloud accounts for 40%. The public cloud market is dominated by Alibaba and Tencent, while the private cloud market such as Huawei dominates. In the public cloud market, Alibaba and Tencent’s cloud businesses face structural problems and increasingly fierce competition, making it difficult for them to continue growing rapidly.
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