However, Amazon Web Services, an e-commerce store, is larger than its Chinese counterpart. AVS sold $ 6.68 billion in sales in the third quarter.
Amazon's success can be good for Alibaba: "Currently cloud services in Alibaba are in investment mode and are not profitable. As their cloud services work at the company level, they have the potential to become a profitable company for the company, just like AVS to Amazon, "Garner said.
Alibaba seeks cloud computing as a way to diversify its retail business – just like Amazon radio more than ten years ago. In the meantime, Alibaba also pushes a strategy called "New Retail", where it tries to combine its online properties with brick and mortar stores. This includes the delivery of food and your own logistics network.
The company also announced plans earlier this year to design its own smart artificial intelligence chips. They should go to servers that deal with huge amounts of data and could help Alibaba, as it tries to boost its division in the cloud.
"The chip is the core of computer power, so if you want to integrate AI into the work … everything is in the computer field … so I think we have to spend time on chips," Zhang told CNBC.