Alibaba's cloud-computing unit opens data center in Silicon Valley

Associated Press

The cloud-computing unit of Chinese e-commerce powerhouse Alibaba is making its first foray into the U.S. by opening a data center in Silicon Valley.

Aliyun, Alibaba's cloud-computing subsidiary, is opening the center to try to sell its data storage and other services to U.S. companies. It will be competing against Amazon Web Services, Microsoft's Azure and Google's cloud platform services.

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In China, Aliyun has been offering commercial cloud services to government agencies and merchants on Alibaba's Tmall.com and Taobao Marketplace online shopping platforms since 2009.

Sicheng Yu, Aliyun vice president and head of its international business, said the company was "testing the water" in the U.S.

"We know well what Chinese clients need, and now it's time for us to learn what U.S. clients need," he said in a blog posting on Alibaba's website.

By the end of the year Aliyun plans to expand to Southeast Asia and Europe as well.

Shares of Alibaba Group rose $3.91, or 4.8 percent, to close at $85.49 on Wednesday. The stock is closer to the low end of its trading range since it went public in September and is off 29 percent since its trading high of $120.