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Alibaba is spending $15 billion on researching quantum computing, AI, and more

Alibaba is spending $15 billion on researching quantum computing, AI, and more


The e-commerce giant looks overseas for R&D to move beyond its roots

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Jack Ma Awards Rural Schoolmasters In Western China
Alibaba founder and CEO Jack Ma
Photo by Wang He/Getty Images

Chinese e-commerce giant Alibaba has unveiled plans to invest $15 billion in R&D projects. According to a report from Quartz, the money was announced at the company’s annual cloud computing conference in Hangzhou. The initiative is part of Alibaba’s so-called DAMO Academy (or “Discovery, Adventure, Momentum, and Outlook”) and will include the opening of seven new labs: two in China, with others in Singapore, Moscow, near Seattle, and in Silicon Valley.

The scope of research to be conducted in these facilities is broad, focusing on both “foundational and disruptive technology,” says Alibaba. This will include areas like the internet of things and data analysis, as well as artificial intelligence and even quantum computing.

Alibaba CTO Jeff Zhang outlined the project’s scope on-stage in Hangzhou. “We aim to discover breakthrough technologies that will enable greater efficiency, network security and ecosystem synergy for end users and businesses everywhere,” said Zhang, reports the Financial Times. The research will be key for Alibaba to reach its goal of serving two billion customers and creating 100 million jobs by 2036.

More to the point, it could help the company move beyond its roots as an e-commerce firm. Fellow retailer Amazon turned its cloud services into an extremely profitable multi-billion-dollar business in just over a decade, and Alibaba has been expressing a desire to do the same. Investment in big data and machine learning could give an edge over rivals and allow it to offer off-the-shelf AI services to attract customers.

Currently, Alibaba’s cloud business makes just over $250 million a quarter (which is pretty small compared to Amazon Web Services, which makes $4.1 billion in the same amount of time) but the Chinese market is growing fast —  more than double the rate of the US. Alibaba already has a bigger market share than rivals like Tencent and China Telecom, and new R&D funding should help it sharpen that edge.