Alibaba Cloud Cut Product Prices To 55%

JAKARTA - Alibaba Cloud, part of China's e-commerce leader, Alibaba Group Holding, announced on Thursday 29 February, cutting product prices by 55%. This is the biggest price cut they have ever done, in response to increasingly fierce competition in attracting users, especially artificial intelligence software developers (AI).

This is the second time in a year that Alibaba Cloud has cut prices, having previously cut 50% in April 2023. More than 100 products will experience an average price reduction of 20%.

The move is part of Alibaba's strategy to attract developers to build AI models and data-based apps using their cloud services. Tencent Holdings and Huawei Technologies have also cut cloud prices last year, offering promotions to drive AI development in their ecosystem.

Alibaba Cloud, as one of the early participants in China's cloud computing market, now serves about a third of local markets. Analysts estimate that Alibaba's discount campaign could encourage competitors to lower prices as well.

However, Alibaba's price cutting exercise this time is considered more aggressive than ever, with prices even applicable to orders that have not been processed for existing customers, which are considered a violation of market norms. Alibaba also offers cheaper new rates for customers who renew their contracts with Alibaba for another year.

In addition, Alibaba not only cuts prices for old products, but also for some new products, marking a more aggressive strategy change in finding customers.